dissenting on the second point: The administration of the income taxing statutes is necessarily highly practical (Tyler v. United States, 281 U. S. 497) and, so far as reasonably possible, therefore, effect should be given to the customs and usages of busi*587ness. To one on a cash basis, these taxing acts unqualifiedly permit the deduction of certain specific items, including taxes, interest, and ordinary and necessary expenses of doing business, “ paid ” during the tax year. It would seem unquestioned that a taxpayer on such a basis, who owed taxes to A municipality, accrued interest at B bank, and ordinary and necessary expenses of his business to C, and who then borrowed funds at X bank on his promissory note, and paid these items, would be entitled to their deduction from his gross income in the determination of taxable income for the year in which they were paid. Robert B. Keenan, 20 B. T. A. 498. If the taxpayer has a loan at X bank, and, before an interest maturity date thereon, he borrows additional funds from that bank which are deposited in his account and then later, upon the maturity of the interest on the original loan, he pays that interest by a check on his own account, at that bank, certainly that amount is deductible as interest paid. I disagree with the majority conclusion that the taxpayer is denied this statutory deduction for accrued interest merely because the loan is made from the creditor to whom the interest is due. Contrary to the premise of the majority opinion, the payor and payee of interest met by the giving of a note in such instance are not in pari passu, where the obligation of such interest is satisfied by a mere promise to pay, in the form of a promissory note, and the deductions summarily denied as in the case of Hart v. Commissioner, 54 Fed. (2d) 848, affirming 21 B. T. A. 1001. (Cited in the majority opinion.) The recipient of that note admittedly receives taxable income upon the sale or other disposition of that note. But that sale or other disposition by the payee does not entitle the promissor on the note to deduct any part of it as interest paid, since he has not yet paid it.
It seems that a logical and practical test here which will not only reconcile the so-called commission cases (Blair v. First Trust & Savings Bank, 39 Fed. (2d) 462, and Helvering v. Martin-Stubblefield, Inc., 71 Fed. (2d) 944), but which will give the taxpayer the right which Congress specifically granted, without an absurd pyramiding of interest payments or unjustifiable postponement of absolute statutory deductions, and avoid a result which may well lead to the necessity of impracticable inquiry into the source of funds with which such unconditionally deductible items were paid, is that — such deductions for interest paid are allowable when made from funds arising from loans made in independent transactions from those upon which the interest paid has accrued, whether such loans be made from the same creditor to whom the interest is owed ,or another. I think the transaction disclosed in the case of John C. Hermann, 21 B. T. A. 409, was such an independent transaction. The facts in the pending *588record, presenting the second issue, are even stronger to that effect since, not only was the second loan approximately double the amount of the first, but the second loan was collaterally secured while the first was not. In my judgment, the decision of the Board in the Hermann case upon the facts there presented was right, and controls the disposition of the second issue here.
TRamMeul, AruNdell, VaN FossaN, aNd McMahon agree with this dissent.