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constituted personal property because it satisfied the "sole
justification" test inasmuch as the boiler facility was
"designed, constructed, and operated for the essential purpose
and primary function of steam production, in order to furnish
additional air, and to provide the required temperature and
humidity requirements essential in the manufacture of the
furniture." Id. at 8. Respondent contends that Rev. Rul. 70-160
is inapposite because heating the buildings was the primary
purpose for the boilers.
We are not persuaded that the boilers in the subject
category were designed, constructed, and operated solely to
provide steam for the operation of petitioners' hospital
equipment and that heating the buildings is merely an incidental
function of the boilers. We also do not agree with respondent
that producing high-pressure steam for petitioners' equipment is
an incidental function of the boilers. Based on the record, we
conclude that the boilers were installed to, and did, serve dual
functions. There is no evidence that petitioners had any other
heating system for their building outside of the subject boilers.
Heat is essential for the operation of buildings. However, we
also are convinced that high-pressure steam is essential for the
operation of certain hospital equipment. Under the circumstances
present in the instant case, we find that both providing heat for
the buildings and providing high-pressure steam for the hospital
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