Charles Baloian Co. v. Commissioner

Simpson, J.,

dissenting: I regret to see that a majority of my colleagues still have not been convinced by the views which I set forth in the Fairfax Auto Parts case (65 T.C. at 807-813), nor by the fact that such views were found persuasive by the Court of Appeals for the Fourth Circuit (548 F.2d 501 (1977), revg. per curiam 65 T.C. 798 (1976)). Here, I merely reiterate that a careful reading of the statute and legislative history reveals no genuine ambiguity in the legislative purpose— Congress meant to require common ownership only for purposes of the 50-percent test and not for purposes of the 80-percent test. A proper appreciation of section 1561 requires a consideration of previous attempts to limit the surtax exemptions in the case of multiple corporations, and when so considered, one can easily recognize that Congress turned to a mechanical test after its dissatisfaction with the results achieved by the subjective tests of sections 269 and 1551. It is not our province to pass upon the wisdom of such an approach. So long as the legislative purpose is manifested, and the regulations are not arbitrary, it is our responsibility to accept and apply them.

Raum, Tannenwald, Quealy, and Wilbur, JJ., agree with this dissent.