Penn Chem. Works v. Commissioner

*444OPINION.

Milliken :

In the first issue, we are concerned with the determination of the cash value of tangible property paid in for capital stock. The issue is common to both years and arises out of a chain of transactions between brothers, father and sons, and partners of many years’ association, under circumstances which lead very reasonably to belief in the contention of the petitioner that the values assigned by the parties were merely nominal and that dealings for years had been characterized by a disregard of real values and of fine distinctions as to individual interests. F. P. Harned testified that about the year 1905, he was offered $105,000 for the property and that in 1910, in his judgment, the property was worth $190,000. F. K. Wainwright testified, in his opinion, the property was worth between $150,000 and $160,000 in 1910, when turned over to the corporation. We are satisfied that the land and buildings, when paid in for capital stock of $65,000 par value, had a cash value of $150,000 and that the paid-in surplus of $40,000 thus resulting, is attributable to the value of the land.

In the second issue, the petitioner relies upon a showing of unusually large income earned without expenditures for salesmen and advertising, and that no salaries were paid officers during the taxable years. There is no evidence that invested capital can not be deter*445mined or of abnormality of capital or income, and accordingly the respondent is sustained on this issue.

Judgment will be entered on 15 days’ notice, wnder Rule 50.