concurring: Section 104 (a) of the Revenue Act of 1936 contains and prescribes a standard by which the classification of a type of corporation as a “bank” shall and may be made. The purpose of the classification is to include or exclude institutions from the surtax prescribed by section 14 and for the purpose of normal tax, as is made clear in section 104 (b).
*1206The standard set forth in section 104 (a) is found in the words: “a substantial part of the business of which consists of receiving deposits and making loans and discounts”, etc. In short, the definition of a “bank” contained in section 104 (a) is a definition in a Federal statute, and for purposes of Federal taxation that definition is controlling, not a definition applied by a statute of a state to institutions. Conceivably a state statute may contain a definition of a “bank” which is at variance with the definition of a “bank” in the revenue acts. But in administering a Federal statute, the definition in the Federal statute is the one to be applied. Where the Federal statute does not contain language indicating that the classifications or definitions of local statutes are to be referred to for purposes of administering the Federal statute and the Federal statute itself sets forth a definition and a standard, there can be little doubt that the Federal statute’s standard is determinative. From then on it is a matter of fact whether an institution is or is not the type of institution defined in the Federal statute. Cf. Fidelity Savings & Loan Co., 44 B. T. A. 471.
The above represents roughly the rationale of the Circuit Court’s view expressed in Staunton Industrial Loan Corporation v. Commissioner, 120 Fed. (2d) 912.
The dissenting opinion in this case presents a conflict in the construction to be given to the language of section 104 (a). It is not uncommon to find differences of opinion as to what the words in a statute say. But I doubt the validity of the general view of the author of the dissenting opinion as to the effect to be given the portion which is quoted of the Supreme Court’s decision in United States v. Cambridge Loan & Building Co., 278 U. S. 55, which, of course, considered another question arising under another statutory provision, namely, section 281 (4) of the Eevenue Act of 1918, and section 231 (4) of the Eevenue Act of 1921, which is the same as section 101 (4) of the Eevenue Act of 1936. From the sentences quoted there is drawn a generalization that the Federal statutes are to be read as defining bank as defined by state statutes. The generality demonstrates the dangers which attend the separation of particular language from an entire text. What the Supreme Court said, which is quoted in the dissent, was in answer to the Government’s argument that the taxpayer, the Cambridge Loan & Building Co., used the terminology descriptive of a building and loan association as a “mask” for its real character, which the Government claimed was that of a bank. The Court pointed out that “a State is not likely to be a party to a scheme to enable a private company to avoid Federal taxation by giving it a false name.” Furthermore, in the Cambridge Loan & Building Co. case, the facts showed that the company in the conduct of its business met the requirements of the Federal *1207statute and the holdings of both the trial court, the Court of Claims, and of the appellate court, the Supreme Court, recognize such to be true. See also, Cambridge Loan & Building Co. v. United States, 63 Ct. Cls. 631, where the facts are set forth at length. It should be noted that Congress, in section 231 (4) of the Revenue Act of 1918, made no prescription of a standard to apply in applying the exemption allowed by section 231 (4). The statute referred merely to “Domestic building and loan associations”, and the Court of Claims observed that “The law of the state in which they were created was the only law which described or defined a building and loan association, and Congress was chargeable with a. knowledge of that law. Until the 1921 act Congress accepted these associations as they existed and were operated in the different states; * * * ” Then in the 1921 Act Congress wrote into section 231 (4) a “standard” or a limitation, which provided a basis for classifying such associations so that they came either within or without the provisions of section 231 (4). Thereupon, state law was no longer to be looked to as controlling, and the portion of the Supreme Court’s decision quoted in the dissenting opinion here can not be so interpreted against the background of the facts in the Cambridge case, which were that under the 1921 Act Cambridge met the standard prescribed because “substantially all of its business” in 1921 and after was with “members.” The Supreme Court, over and above any dicta or the implications to be read into the dicta, recognized the Federal statute as controlling first, and found nothing in the state statutes, in addition thereto, to throw any doubt upon the matter under consideration.
I do not find in this case that the question can properly be posed as involving a conflict between state and Federal statutes, however. I think the terms of section 104 (a) are clear and that the court in the Staunton case correctly construed section 104 (a), and that the facts surrounding petitioner’s business compel the conclusion that petitioner must be classified as a “bank” upon application of the standard found in section 104 (a). Therefore, I concur, with the observation that nothing said in Cambridge Loan & Building Co., supra, is in conflict with the result reached here, and that case, anyway, is not in point. I see no error in applying section 104 (a) to find upon facts that “a particular institution falls without the definition of a ‘bank’ as drafted by a state legislature” and still “falls within the clear policy and broad definition stated by Congress.” Staunton Industrial Loan Corporation v. Commissioner, supra.