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Barden also testified that his other brother, Tim, who runs
Tebarco Door and Metal Services (Tebarco Door), stored his
material in the warehouse as well.
At trial, Vicki Byers (Byers), a revenue agent, who
conducted an onsite audit of petitioner's business testified that
while touring the warehouse with Barden she and another agent
discussed the approximate value of the inventory in petitioner's
warehouse. Although Barden valued the inventory at somewhere
between $10,000 and $20,000, he at no time indicated to Byers
that some of the material belonged to his brothers. Given that
petitioner was being audited, we believe that if the materials in
the warehouse belonged to anyone other than petitioner, Barden
would have informed the agent of that fact. Barden's failure to
do so leads us to believe that the materials in the warehouse did
indeed belong to petitioner. Furthermore, Barden's brothers were
not called to testify regarding the inventory maintained in
petitioner's warehouse, nor did petitioner call anyone who worked
at either General Mechanical or Tebarco Door to corroborate the
validity of Barden's testimony. We note that the absence of
testimonial evidence may lead the finder of fact to infer that
such evidence, if presented at trial, subject to respondent's
cross-examination, would not have been favorable to petitioner.
McKay v. Commissioner, 89 T.C. 1063, 1069 (1987), affd. 886 F.2d
1237 (9th Cir. 1989); Wichita Terminal Elevator Co. v.
Commissioner, 6 T.C. 1158, 1165 (1946), affd. 162 F.2d 513 (10th
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