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Here, Energy's critical act was to sign the consents without
informing respondent that the individuals signing them were not,
as they represented themselves to be, officers of New Petroleum.
Had respondent known that Lobliner and Markowitz were not
officers of New Petroleum and that the corporation did not exist,
respondent could have obtained either a correct consent from
Energy or issued a notice of deficiency before the period of
limitations expired with respect to 1985. Accordingly, we find
that respondent reasonably relied to his detriment on
petitioner's misrepresentations or silences with respect to the
merger transaction.
4. Knowledge of the Facts
To meet the fourth prong of equitable estoppel, the
Government must prove not only that respondent was "'destitute of
knowledge of the real facts as to the matter in controversy, but
should also have been without convenient or ready means of
acquiring such knowledge.'" Southwestern Inv. Co. v.
Commissioner, 19 B.T.A. 30, 47 (1930) (citing Brant v. Virginia
Coal and Iron Company, et. al, 93 U.S. 326, 337 (1876)).
Respondent contends that neither the agents nor Appeals
officers involved with the WPT audit had actual knowledge of New
Petroleum's dissolution at the time the last three Forms 872 were
signed. Moreover, respondent points to the fact that petitioners
stipulated that both Energy and New Petroleum failed to inform
the WPT agents of the true situation regarding the merger.
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