- 92 -
311 U.S. 46, 49 (1940). This rule of interpretation applies
equally to transitional rules. United States v. Commonwealth
Energy Sys., 235 F.3d 11, 16 (1st Cir. 2000); see Apache Bend
Apartments, Ltd. v. United States, 987 F.2d 1174, 1175 (5th Cir.
1993); United States v. Kjellstrom, 916 F. Supp. 902, 905 (W.D.
Wis. 1996), affd. 100 F.3d 482 (7th Cir. 1996). As the Court of
Appeals for the First Circuit explained:
The transition rules were enacted to provide relief “to
a very, very few specified favored taxpayers,” * * *
and although we must extend them to all qualifying
taxpayers, * * * we need not broaden our interpretation
so that entities that did not detrimentally rely on the
old rule benefit from the transition exemption * * *
[Citations omitted.]
United States v. Commonwealth Energy Sys., supra at 16. The
taxpayer bears the burden of proving that it qualifies for the
transitional rules. Rule 142(a); Payless Cashways, Inc. v.
Commissioner, 114 T.C. 72, 80 (2000).
B. TRA Section 204(a)(3)--Supply or Service Contracts
Petitioner argues that it is entitled to ITCs for property
FPL placed in service during the years at issue because FPL
purchased and/or installed the property pursuant to binding,
written supply contracts within the meaning of TRA section
204(a)(3). According to petitioner, the following contracts
constitute binding, written supply contracts: (1) The tariff;
(2) the Southern company contracts; and (3) the documents
exchanged with respect to the DRIs. Respondent argues that
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