Raymond E. Roth - Page 3

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               The issues for decision are (1) whether there are any                  
          genuine issues as to material facts and, if there are no such               
          issues, then (2) whether respondent is entitled to judgment as a            
          matter of law on the deficiencies and additions to tax.                     
          Background--Procedure                                                       
               Petitioner invoked this Court’s jurisdiction by filing a               
          timely petition from the two notices of deficiency that embodied            
          respondent’s determinations described supra.  Respondent filed an           
          answer to the petition, including specific allegations with                 
          regard to the fraud determinations.  Petitioner did not file a              
          reply to this answer.  Respondent filed a motion pursuant to Rule           
          37(c) that undenied allegations in the answer be deemed admitted.           
          The Court issued an order to petitioner, advising him of the                
          filing of respondent’s motion under Rule 37(c) and directing                
          petitioner to file a reply to respondent’s answer within 20 days            
          of the order.  Petitioner failed to file a reply to respondent’s            
          answer or otherwise respond to the Court’s order.  Consequently,            
          we granted respondent’s Rule 37(c) motion, and the undenied                 
          allegations set forth in respondent’s answer were deemed to be              
          admitted.  Gilday v. Commissioner, 62 T.C. 260, 261-262 (1974);             
          see Gordon v. Commissioner, 73 T.C. 736, 739-740 (1980).                    
               On May 20, 1997, the Court served the parties with notice of           
          trial in St. Louis, Mo., the location designated by petitioner.             





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