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v. Commissioner, 866 F.2d 545, 547 (2d Cir. 1989), vacating in
part T.C. Memo. 1988-211; Harness v. Commissioner, T.C. Memo.
1991-321.
In the present cases, no argument was made and no evidence
was presented to the Court to prove that disallowance and
concession of the claimed investment tax credits and other tax
benefits related to anything other than a valuation
overstatement. To the contrary, petitioners each stipulated
substantially the same facts concerning the Partnership
transactions as we found in Provizer v. Commissioner, T.C. Memo.
1992-177. In the Provizer case, we held that the taxpayers were
liable for the section 6659 addition to tax because the
underpayment of taxes was directly related to the overvaluation
of the Sentinel EPE recyclers. The overvaluation of the
recyclers, exceeding 2,325 percent, was an integral part of our
findings in Provizer that the transaction was a sham and lacked
economic substance. Similarly, the records in these cases
plainly show that the overvaluation of the recyclers is integral
to and is the core of our holding that the underlying
transactions here were shams and lacked economic substance.
Petitioners reliance on McCrary v. Commissioner, supra, is
misplaced. In that case, the taxpayers conceded disentitlement
to their claimed tax benefits and the section 6659 addition to
tax was held inapplicable. However, the taxpayers' concession of
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