- 78 -- 78 -
percent, was an integral part of our findings in Provizer v.
Commissioner, supra, that the transaction was a sham and lacked
economic substance. Similarly, the records in these cases
plainly show that the overvaluation of the recyclers is integral
to and is the core of our holding that the underlying
transactions here were shams and lacked economic substance.
Petitioners' reliance on McCrary v. Commissioner, supra, is
misplaced. In that case, the taxpayers conceded their claimed
tax benefits, and the section 6659 additions to tax were held
inapplicable. However, the concessions of the claimed tax
benefits, in and of themselves, did not preclude imposition of
the section 6659 additions to tax. In McCrary v. Commissioner,
supra, the section 6659 addition to tax was disallowed because
the agreement at issue was conceded to be a license and not a
lease. In contrast, the records in petitioners' cases plainly
show that petitioners' underpayments were attributable to
overvaluation of the Sentinel EPE recyclers. We hold that
petitioners' reliance on McCrary v. Commissioner, supra, is
inappropriate.17
We held in Provizer v. Commissioner, supra, that each
17 Petitioners' citation of Heasley v. Commissioner, supra, in
support of the concession argument is also inappropriate. That
case was not decided by the Court of Appeals for the Fifth
Circuit on the basis of a concession. Moreover, see supra note
16 to the effect that the Court of Appeals for the Second Circuit
and this Court have not followed the Heasley opinion with respect
to the application of sec. 6659.
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