J.J. Zand - Page 97

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          Amelia Corporation.  The record contains a 1976 memo to the file            
          in which it is stated that there was a $50,000 payment to Amelia            
          Corporation, which petitioner stated was for "expenses".                    
          However, the record does not reveal when this payment was made,             
          if at all, or for what.  Therefore, the payment has not been                
          proven to be a deductible expense.                                          
                               D.  SEDCO, IMICO, IMISS                                
               Although the joint venture and dealership agreements at                
          issue were between Diesel Power and Stewart & Stevenson, SEDCO,             
          and IMICO, the record shows that there was virtually no                     
          involvement in these arrangements by Diesel Power; rather, they             
          were agreements with Diesel Power in name only.  Petitioner and             
          his CTC employees made all the arrangements to create and                   
          implement these ventures; Diesel Power was simply informed about            
          them after the fact.  While petitioner's testimony attempts to              
          convince us that CTC merely assisted with some of the paperwork             
          involved, the contemporaneous documents indicate otherwise; i.e.,           
          they show that petitioner was actively involved in this venture             
          and that Diesel Power was not.  Therefore, petitioner's income              
          includes all commissions received from SEDCO, SEDIRAN, IMICO, and           
          Stewart & Stevenson during 1973, 1974, 1975, and 1976 which are             
          recorded on the CTC receipts journal as Diesel Power commissions.           
               With regard to the allegation in the 1973 notice of                    
          deficiency of $1,000 in unreported income from Stewart &                    





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