Boker Cutlery & Hardware Co. v. Commissioner

Board of Tax Appeals

Boker Cutlery & Hardware Co. v. Commissioner

12 B.T.A. 1405, 1928 BTA LEXIS 3341

CourtUnited States Board of Tax Appeals

DecidedJuly 19, 1928

DocketDocket No. 13267.

StatusPublished

Cited by1 cases

This text of 12 B.T.A. 1405 (Boker Cutlery & Hardware 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

Boker Cutlery & Hardware Co. v. Commissioner, 12 B.T.A. 1405, 1928 BTA LEXIS 3341 (bta 1928).

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Opinion

[1406]*1406OPINION.

Arundell:

The petitioner seeks affiliation only with H. Boker & Co., Inc. Evidence as to the other two companies was introduced to show the unity of management and close business relationship existing between all four.

As to the ownership of petitioner’s stock, H. Boker & Co., Inc., owned 122 shares of a total of 162 shares outstanding, or 75.3 per cent. The remaining 24.7 per cent of the stock was owned by Grafmueller, who was vice president and a director of the parent company. Prior to the creation of che petitioner Grafmueller had been in charge of the cutlery department of the parent company and its predecessor and the petitioner company was created largely for the purpose of giving him an interest in the business. Grafmueller was in reality an employee, and the petitioner a department of the parent; the profitable existence of the petitioner, and hence the value of Grafmueller’s stock, depended upon sales of products made by two concerns, in one [1407]*1407of which the parent company owned all the stock and in the other it owned 83½ per cent. From all the facts and circumstances we are satisfied that the parent company controlled all of the stock of the petitioner that it did not directly own. Hamilton & Chambers Co., Inc., 1 B. T. A. 694; John Robinson Shows Co., 12 B. T. A. 806.

Judgment will be entered, under Rule 50.

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[1406]*1406OPINION.

Arundell:

The petitioner seeks affiliation only with H. Boker & Co., Inc. Evidence as to the other two companies was introduced to show the unity of management and close business relationship existing between all four.

As to the ownership of petitioner’s stock, H. Boker & Co., Inc., owned 122 shares of a total of 162 shares outstanding, or 75.3 per cent. The remaining 24.7 per cent of the stock was owned by Grafmueller, who was vice president and a director of the parent company. Prior to the creation of che petitioner Grafmueller had been in charge of the cutlery department of the parent company and its predecessor and the petitioner company was created largely for the purpose of giving him an interest in the business. Grafmueller was in reality an employee, and the petitioner a department of the parent; the profitable existence of the petitioner, and hence the value of Grafmueller’s stock, depended upon sales of products made by two concerns, in one [1407]*1407of which the parent company owned all the stock and in the other it owned 83½ per cent. From all the facts and circumstances we are satisfied that the parent company controlled all of the stock of the petitioner that it did not directly own. Hamilton & Chambers Co., Inc., 1 B. T. A. 694; John Robinson Shows Co., 12 B. T. A. 806.

Judgment will be entered, under Rule 50.

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12 B.T.A. 1405, 1928 BTA LEXIS 3341, Counsel Stack Legal Research, https://law.counselstack.com/opinion/boker-cutlery-hardware-co-v-commissioner-bta-1928.

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