- 27 - With respect to each vendor receiving petitioner-delivered currency, the delivery was of either, or both of, promotional- allowance currency or vendor-check currency. A vendor retained control of its promotional allowance account,7 and only upon its specific instruction was petitioner authorized to charge the account and deliver a specified amount of currency to the vendor at the food show. Petitioner had no discretion in the matter. Petitioner likewise lacked discretion with respect to the proceeds of a vendor’s check that it delivered to the vendor at the food show. In N. Am. Oil Consol. v. Burnet, 286 U.S. 417, 424 (1932), the Supreme Court announced what has been termed the “claim-of-right” doctrine: If a taxpayer receives earnings under a claim of right and without restriction as to its disposition, he has received income which he is required to return, even though it may still be claimed that he is not entitled to retain the money, and even though he may still be adjudged liable to restore its equivalent. * * * The doctrine does not apply to amounts a taxpayer receives as a mere conduit or agent for transmittal to another. E.g., Apothaker v. Commissioner, T.C. Memo. 1985-445. Indeed, in a case predating subchapter T and upholding the payer corporation’s exclusion from gross income of patronage based refunds, the Court of Appeals for the Fifth Circuit grounded its analysis in part on the following proposition: “‘[I]n order for receipts to 7 See supra note 5.Page: Previous 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 NextLast modified: November 10, 2007