- 11 - Initially, respondent argues that petitioner's red landscaping rock should be classified as "stone" under section 613(b)(6) because the red landscaping rock was not used for its chemical or metallurgical properties; this classification would result in a 5-percent depletion rate. Prior to the enactment of the 1954 Code, the predecessor to section 613(b) provided a 5- percent depletion rate for sand, gravel, and stone; a 10-percent rate for dolomite; and a 15-percent rate for chemical and metallurgical grade limestone. Sec. 114(b)(4)(A) of the 1939 Code, as amended by the Revenue Act of 1951, ch. 521, sec. 319(a), 65 Stat. 452, 497; G. & W. H. Corson, Inc. v. Commissioner, 54 T.C. 668, 675 (1970), affd. 453 F.2d 578 (3d Cir. 1971). However, in section 613(b) of the 1954 Code, the qualifiers "chemical grade" and "metallurgical grade" were dropped from limestone, dolomite was added to the 15 percent (now 14 percent) depletion rate category, and the "use test", i.e., "when used, or sold for use, by the mine owner or operator as rip rap, ballast, road material, rubble, concrete aggregates, or for similar purposes", was added. Thus, whether limestone is of chemical grade is no longer a factor. G. & W. H. Corson, Inc. v. Commissioner, supra; see also C. J. Langenfelder & Son, Inc. v. Commissioner, 69 T.C. 378 (1977) (chemical attributes test rejected for use of oyster shells). Accordingly, the chemical and metallurgical properties foundation of respondent's argument falls by the wayside.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Next
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