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(a) 1983. Petitioner contends that the fact that an earlier
audit of petitioner’s and Betsy’s 1983 joint tax return revealed
that they overstated their income for that year indicates that
petitioner lacked an intent to evade tax for 1983. Respondent
contends that because petitioner did not offer any explanation of
this audit, it is impossible to draw conclusions from this audit
that are relevant to determining petitioner’s intent with respect
to the unreported income for 1983. Respondent also contends that
the lack of evidence in the record regarding the audit conducted
in 1987 should be construed against petitioner. Respondent urges
that, under the Wichita Terminal doctrine, petitioner’s failure
to offer further evidence of the earlier audit gives rise to the
inference that any such evidence would not be favorable to
petitioner. See Wichita Terminal Elevator Co. v. Commissioner, 6
T.C. 1158, 1165 (1946), affd. 162 F.2d 513 (10th Cir. 1947).
We agree with petitioner’s conclusion.
As table 13, supra, shows, petitioner and Betsy reported a
joint liability of $160,344 for 1983. In the notice of
deficiency in the instant cases, respondent determined a joint
tax liability of $138,142--$22,202 less than what petitioner and
Betsy reported. In other words, respondent’s determination in
the notice of deficiency means that petitioner and Betsy
originally overstated their 1983 tax liability by $22,202. As a
result of respondent’s concessions (supra note 2), respondent now
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