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the taxable year); Rev. Rul. 90-65, 1990-2 C.B. 41 (the cost of
unrecovered platinum from prills used in refining petroleum is a
material or supply expense allowed under section 1.162-3, Income
Tax Regs.). Accordingly, in Galedrige Constr., Inc. v.
Commissioner, supra, we held that in the hands of the
taxpayer/paving contractor, the emulsified asphalt was a supply,
not merchandise.
Similarly, in this case the only form of the concrete that
provides utility to petitioner is the liquid or wet form. Also,
similar to the emulsified asphalt in Galedrige Constr., Inc. v.
Commissioner, supra, the physical state of the concrete changes
very quickly from one that provides utility to petitioner, to one
that has no value at all.
The ready-mix concrete in this case is practically
indistinguishable from the emulsified asphalt material in
Galedrige Constr., Inc. Considering the facts of this case (and
Galedrige) and the ephemeral quality of the material at issue,
only a strained and unconventional interpretation of the word
"merchandise" would include liquid concrete (or emulsified
asphalt) within its definition.8
These materials with their severely limited periods of
utility that were ordered specifically for, delivered to, and
8We here are dealing with the physical laws of the Universe,
against which the laws of mere mortals cannot stand.
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