Blackford Window Glass Co. v. Commissioner

Board of Tax Appeals

Blackford Window Glass Co. v. Commissioner

13 B.T.A. 1268, 1928 BTA LEXIS 3066

CourtUnited States Board of Tax Appeals

DecidedOctober 30, 1928

DocketDocket No. 3445.

StatusPublished

Cited by1 cases

This text of 13 B.T.A. 1268 (Blackford Window Glass Co. v. Commissioner) is published on Counsel Stack Legal Research, covering United States Board of Tax Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Blackford Window Glass Co. v. Commissioner, 13 B.T.A. 1268, 1928 BTA LEXIS 3066 (bta 1928).

Pincite

Opinion

[1270]*1270OPINION.

Murdoch :

The only issue in this proceeding involves the right of the petitioner to take an allowance for the years 1919 and 1920 by reason of the obsolescence of its plant. There is no question from the evidence that revolutionary changes in the window glass business to which the petitioner was exclusively devoting itself were gradually taking place over a long period of years.

It is also clear that the machinery utilized in the manufacture of hand-blown glass had been entirely abandoned and that any salvage value which it might have would be offset by the cost of removal. The petitioner, however, has not shown what the depreciated cost of the abandoned machinery was. The main building of the old plant, which contained the blowing room, had evidently not been abandoned by the petitioner, since it is shown that the roof had been kept in repair. This indicates to our minds that the building was regarded by the petitioner as having some potential value in the future although it ceased to be used when the new plant was erected. Had it been the petitioner’s intention entirely to abandon the building in question it would have been allowed to lapse into a state of complete disrepair. As we said in the case of Marigold Garden Co., et al, 6 B. T. A. 371, “ Until the investment is converted into terms of money by gale or other disposition or its worthlessness otherwise [1271]*1271demonstrated, there is neither loss nor gain and income is neither greater nor less.” See also McAvoy Company, 10 B. T. A. 1017.

In the instant case we are confronted with the impossibility of separating assets obviously abandoned from those clearly not yet abandoned. The petitioner has not separated the depreciated cost of machinery from that of the buildings and since the latter must be held to be assets upon which no obsolescence can be allowed, we are not in a position to allow obsolescence for the machinery, the depreciated cost of which is unknown to us.

Judgment will be entered under Rule 50.

Free access — add to your briefcase to read the full text and ask questions with AI

[1270]*1270OPINION.

Murdoch :

The only issue in this proceeding involves the right of the petitioner to take an allowance for the years 1919 and 1920 by reason of the obsolescence of its plant. There is no question from the evidence that revolutionary changes in the window glass business to which the petitioner was exclusively devoting itself were gradually taking place over a long period of years.

It is also clear that the machinery utilized in the manufacture of hand-blown glass had been entirely abandoned and that any salvage value which it might have would be offset by the cost of removal. The petitioner, however, has not shown what the depreciated cost of the abandoned machinery was. The main building of the old plant, which contained the blowing room, had evidently not been abandoned by the petitioner, since it is shown that the roof had been kept in repair. This indicates to our minds that the building was regarded by the petitioner as having some potential value in the future although it ceased to be used when the new plant was erected. Had it been the petitioner’s intention entirely to abandon the building in question it would have been allowed to lapse into a state of complete disrepair. As we said in the case of Marigold Garden Co., et al, 6 B. T. A. 371, “ Until the investment is converted into terms of money by gale or other disposition or its worthlessness otherwise [1271]*1271demonstrated, there is neither loss nor gain and income is neither greater nor less.” See also McAvoy Company, 10 B. T. A. 1017.

In the instant case we are confronted with the impossibility of separating assets obviously abandoned from those clearly not yet abandoned. The petitioner has not separated the depreciated cost of machinery from that of the buildings and since the latter must be held to be assets upon which no obsolescence can be allowed, we are not in a position to allow obsolescence for the machinery, the depreciated cost of which is unknown to us.

Judgment will be entered under Rule 50.

Cite This Page — Counsel Stack

Bluebook (online)

13 B.T.A. 1268, 1928 BTA LEXIS 3066, Counsel Stack Legal Research, https://law.counselstack.com/opinion/blackford-window-glass-co-v-commissioner-bta-1928.

Opinion

Related

Cite This Page — Counsel Stack