- 97 -
group. Joint Committee report, supra at 66. After considering
the Joint Committee report, the House of Representatives (House)
in its bill that Congress considered in connection with passage
of the 1928 Act decided to deny the privilege of filing consoli-
dated returns after taxable year 1928, thereby compelling all
corporations to file separate returns. See H.R. 1, 70th Cong.,
1st Sess. sec. 141 (1927); see also H. Rept. 2, 70th Cong. 1st
Sess. (1927), 1939-1 C.B. (Part 2) 384, 397.
The Senate Finance Committee was not convinced that elimina-
tion of the privilege of filing consolidated returns was an
appropriate solution to the wide range of problems and potential
abuses to which the Joint Committee report alluded that had
emerged in the administration and interpretation of the consoli-
dated return provisions. Instead, the Senate Finance Committee
recommended retention of the consolidated return provisions but
coupled such retention with provisions authorizing the Commis-
sioner, with the approval of the Secretary of the Treasury
(Secretary), to promulgate special regulations that would deal
with the types of problems and potential abuses raised by the
Joint Committee report. The Senate Finance Committee stated in
pertinent part:
Many difficult and complicated problems * * * have
arisen in the administration of the provisions permit-
ting the filing of consolidated returns. It is, obvi-
ously, of utmost importance that these questions be
answered with certainty and a definite rule be pre-
scribed. Frequently, the particular policy is compara-
tively immaterial, so long as the rule to be applied is
known. The committee believes it to be impracticable
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