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Effect of the Consent Judgment
Petitioner contends that the Consent Judgment was tantamount
to a ruling, opinion, or exemption issued pursuant to authority
that was delegated solely to the DOL under Reorganization Plan
section 102. As a result, petitioner argues that the IRS "cannot
come to a conclusion concerning a prohibited transaction contrary
to a ruling previously made by the DOL."
Reorganization Plan section 102 gives the DOL the authority
to issue "rulings, opinions, and exemptions". Reorganization
Plan section 105 provides that in enforcing the excise tax
provisions the IRS is bound, "to the extent applicable," by the
regulations, rulings, opinions, and exemptions issued by the DOL
as provided in Reorganization Plan sections 102 and 105.
In December 1991, the IRS notified the DOL about its intent
to disqualify the Plan. At this time, the DOL was pursuing ERISA
title I remedies against the Plan. In February 1993, petitioner
(individually and as trustee of the Plan) and the estate of Mr.
Cohen entered into the Consent Judgment with the DOL. Paragraph
10 of the Judgment specifically provides that "The obligations
imposed by this Judgment are not binding on any Government agency
other than the United States Department of Labor." In August
1994, respondent issued to petitioner a notice of deficiency
determining an excise tax.
Petitioner states that the DOL concluded that a prohibited
transaction had not occurred (a "non-violation" according to
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