- 26 -
Appeals for the Second Circuit was correct, however, it would
appear that the approach of the Court of Appeals for the Sixth
Circuit was rejected. Accordingly, the vitality of the holding
in Cleveland Allerton Hotel, Inc. v. Commissioner, supra, holding
is questionable.19 In spite of these circumstances, petitioner
strongly urges that it is entitled to rely on the Cleveland
Allerton Hotel, Inc. holding.20 Further complicating
petitioner’s situation, any appeal of our decision here would be
to the Court of Appeals for the Second Circuit--the “Millinery
Ctr. circuit”. That, of course, militates against petitioner’s
chances for success on appeal, because petitioner would have to
19 Petitioner has provided only one case with comparable
facts and squarely on point that followed Cleveland Allerton
Hotel, Inc. v. Commissioner, supra. See Troc, Inc. v. United
States, 126 F. Supp. 786 (N.D. Ohio 1954). In that regard, we
note that the Troc, Inc. case preceded the Supreme Court’s
opinion in Millinery Ctr. Bldg. Corp. v. Commissioner, 350 U.S.
456 (1956) and that it was within the Sixth Circuit Court of
Appeals’ venue.
20 Petitioner also relies on Priv. Ltr. Rul. 98-42-006
(June 22, 1998) and Field Service Advice 199918022 (May 7, 1999),
both of which were issued subsequent to the transaction in
question and, accordingly, could not have been relied upon. The
administrative discussions give petitioner some solace in their
discussions of Cleveland Allerton and the absence of any
discussion of or reliance on sec. 167(c)(2). Irrespective of the
positions or discussions contained in those administrative
documents, they are statutorily of no precedential value. See
sec. 6110(k)(3). Respondent argues that the cited ruling and
advice are distinguishable. Accordingly, whether the discussion
or positions in rulings or internal advice memoranda are
favorable or unfavorable to taxpayers, in the present situation
we give them no weight.
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