dissenting: I agree with Judge Tannenwald in his concurring opinion that considerations of “detached and disinterested generosity,” “legal duty,” and “control” are immaterial, and that the majority analysis of these phrases may lead to future misinterpretation and misapplication of its holding in other situations. However, I cannot agree with Judge Tannenwald that the decision of the majority is correct because of a statutory mandate, nor can I agree with the majority that the legislative history of sections 511 to 515, inclusive, justifies the result reached by the majority.
I find nothing in the statute which I can interpret as a mandate to disallow the deduction claimed here. In fact, the statutory language, per se, appears to be just to the contrary.
Section 511 imposes a tax on the unrelated business taxable income of certain charitable organizations; and section 512 defines unrelated business taxable income as the gross income derived by any organization from any unrelated trade or business regularly carried on by it, less the deductions allowed by this chapter which are directly connected with the carrying on of such trade or business, both computed with the exceptions, additions, and limitations provided in subsection (b). Subsection (b) (10) specifically provides that in the case of any organization described in section 511(a) the deduction allowed by section 170 (relating to charitable contributions) shall be allowed (whether or not directly connected with the carrying on of the trade or business), but not to exceed 5 percent of the unrelated business taxable income. This would appear to be a deliberate effort to allow a deduction against the unrelated taxable business income of a charitable organization for contributions to charities to the same extent that the deduction is allowed against the taxable business income of any other corporation. There is nothing in the language of the statute itself which specifically prohibits the deduction for a contribution even to the charitable organization itself, except .the fact that it is difficult to contribute to one’s self. But the taxpayer involved here is not the charitable organization itself and as long as the contribution is used for charitable purposes, I see no reason that it should be denied to this taxpayer simply because the charitable organization using the fund for charitable purposes happens to be the owner of the stock of the taxpayer. The 5-percent limitation provides a safeguard against abuse. I can find nothing in the statute itself or in the statutory scheme to justify disallowing the deduction which would seem to be clearly available to the taxpayer here simply because of the language appearing in committee reports which seem to me to be inapposite to the issue we have here.
I would allow the deduction.
FoRResteR, /., agrees with this dissent.