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Many years of experience with the use of informal discovery
in a variety of circumstances have demonstrated to our
satisfaction the efficacy of that procedure. We see no reason to
modify that procedure because here respondent proposes to develop
a test case. Respondent’s correspondence contemplates that the
instant case will involve a "designated issue" under Internal
Revenue Manual sec. 35.3.14., "Designation for Litigation
Procedures." That section provides:
In order to resolve recurring significant issues,
establish judicial precedent, conserve resources, or
reduce litigation costs for the Service and taxpayers,
it is appropriate to designate that an issue in a case
be litigated rather than settled. In a case in which
an issue has been designated for litigation, it is the
position of the Office of Chief Counsel that the
designated issue is not to be settled without a full
concession by the taxpayer * * *. [Id. at sec.
35.3.14.2.]
As a general proposition, we agree that the Commissioner is
entitled to all relevant information regarding the matters in
issue before this Court, and we agree that the Commissioner is
entitled to that information without undue delay. The purpose of
our discovery rules, however, is not to assist respondent in
developing a test case. As we have explained: "The purpose of
discovery in the Tax Court is to ascertain facts which have a
direct bearing on the issues before the Court." To that end, "we
have the power to uphold the integrity of the Court’s process by
enforcing the limited discovery that, by rule, we have adopted."
Ash v. Commissioner, supra at 463, 470-471.
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