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U.S. 56, 66-67 (1942); Silverman v. Commissioner, 538 F.2d 927, 933
(2d Cir. 1976), affg. T.C. Memo. 1974-285.
Our task is made all the more difficult by the lack of any direct
evidence in the record of the market value of the SIC stock. However,
we may approximate the value of the SIC stock by determining the fair
market value of Arnold’s previously held stock in MIC, inasmuch as the
taxable event at issue is the distribution by MIC of SIC stock in
redemption of Arnold’s stock in MIC. See United States v. Davis, 370
U.S. 65, 72 (1962); Philadelphia Park Amusement Co. v. United States,
130 Ct. Cl. 166, 126 F. Supp. 184, 189 (1954); Spruance v.
Commissioner, 60 T.C. 141, 157 (1973), affd. without published opinion
505 F.2d 731 (3d Cir. 1974); Williams v. Commissioner, T.C. Memo.
1997-326.
Respondent did not submit an expert’s report valuing the SIC
stock, arguing that this is not a valuation case. In respondent’s
view, the intervening transfer of property by MIC to SIC and exchange
of SIC stock for Arnold’s MIC stock are to be disregarded, and
petitioner held, under the Court Holding theory, to be the
constructive seller of all property sold to H�agen-Dazs, having a fair
market value of $1,430,340, as established by the price paid by
H�agen-Dazs for assets purchased less than 6 weeks later. Similarly,
respondent argues, even if respondent loses on the Court Holding
theory, that the price paid in the H�agen-Dazs sale is the best
evidence of the value of the assets transferred from MIC to SIC and of
the value of Arnold’s MIC stock that was redeemed. For reasons
previously discussed, we have rejected respondent’s overall position
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