GAF Corporation and Subsidiaries - Page 3




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          dependent upon proposed adjustments to “partnership items”, which             
          may not be adjudicated in this proceeding, or to “affected                    
          items”, which may not be determined before final resolution and               
          adjustment of the partnership items to which they relate.                     
          Petitioner claims that there is no genuine issue as to any                    
          material fact and the law is clear, in its favor.  Respondent                 
          conditionally agrees that there is no genuine issue as to any                 
          material fact.2                                                               
          II.  Discussion                                                               
               A.  Respondent’s Adjustments                                             
               GAF Chemicals Corp. (GAF Chemicals) and Alkaril Chemicals,               
          Inc. (Alkaril), are two members of the affiliated group.  Rhone-              
          Poulenc Surfactants and Specialties, L.P., is a Delaware limited              
          partnership (the partnership).  Respondent’s adjustments, which               
          give rise to the deficiencies and penalty in question, relate to              
          certain transfers of property by GAF Chemicals and Alkaril (the               
          transferors).  The property in question consists of assets                    
          related to businesses carried on by the transferors.  Respondent              
          determined that the transferors realized gains with respect to                
          the property at the time of the transfer.  Petitioner avers that              
          the transfer was a contribution by the transferors to the                     

               2Petitioner has requested a hearing on the motion.  The                  
          parties’ submissions fully set forth their respective positions,              
          and we see no need for any further argument.  Therefore, we have              
          not granted petitioner’s request for a hearing.                               





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