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Without prescribing an absolute and rigid rule
that whenever the Commissioner files a return for a
foreign corporation the taxpayer is completely and
automatically denied the benefit of deductions or
credits, we yet hold that the facts of the instant case
justify a disallowance of deductions which petitioner
might otherwise have been entitled to claim, had it
filed a timely return in compliance with the statutory
requirement. * * * [Id. at 910.]
In Georday Enters., Ltd. v. Commissioner, supra at 388, a
companion case to Blenheim, the Court of Appeals for the Fourth
Circuit stated that "our decision in the Blenheim case is
determinative" on the issue, inter alia, of "the timeliness of
Georday's federal income tax return". The court then stated:
The case for disallowance of Georday's deductions is
even stronger here because Georday failed to file a
return voluntarily not only after a return had been
filed for it by the Commissioner and after a deficiency
letter had been sent to it, but even after a petition
to the Board had been filed. * * * [Id.]
The court held that "Georday, therefore, clearly failed to file
its return within the reasonable terminal period prescribed in
the Blenheim case and is now precluded from obtaining the
benefits of any deductions it might have otherwise been entitled
to claim had it filed a timely return." Id.
In the instant cases, LTD had not filed income tax returns
for the taxable years in issue as of the date of trial of the
instant cases. We therefore uphold respondent’s disallowance of
any deductions that LTD might have otherwise been entitled to
claim had it filed a timely, true, and accurate return pursuant
to section 882(c)(2).
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