- 127 - result because reached by following a devious path. * * * The controlling principle will be found in Gregory v. Helvering”. Respondent also relies on another “reorganization” case, West Coast Mktg. Corp. v. Commissioner, 46 T.C. 32 (1966), in which the sole stockholder and president of the taxpayer corporation desired to dispose of certain land. In order to qualify the disposition as a tax-free reorganization under sections 354(a)(1) and 368(a)(1)(B), a corporation, Manatee, was formed, and the subject land was transferred to Manatee in exchange for stock. The stock of Manatee was then transferred to the acquiring corporation in exchange for its stock. Thereafter, Manatee was liquidated. Citing Minn. Tea Co. v. Helvering, supra, and Gregory v. Helvering, supra, this Court acknowledged that the transaction fell literally within the reorganization provisions but held that “the tax consequences must turn upon the substance of the transaction rather than the form in which it was cast.” West Coast Mktg. Corp. v. Commissioner, supra at 40. Respondent argues that MB Parent in the instant case is comparable to the intermediary corporation in West Coast Mktg. Corp. in that it had no business, no offices, and no employees, and it served no purpose other than to create the form necessary to support a claim for tax-free reorganization treatment. In addition to cases cited above, respondent relies on the legislative history of the reorganization provisions, variousPage: Previous 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 133 134 135 Next
Last modified: May 25, 2011