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Helvering v. Stockholms Enskilda Bank, 293 U.S. 84 (1934)

Helvering v. Stockholms Enskilda Bank

No. 10

Argued October 10, 11, 1934

Decided November 5, 1934

293 U.S. 84


1. Interest received by a foreign corporation from the United States with a refund of income taxes is interest on an "interest-bearing obligation" of a "resident," within the meaning of § 217(a) of the Revenue Act of 1926. P. 293 U. S. 86

2. An obligation to refund taxes erroneously or illegally collected, upon which, by express statutory direction, interest must be paid, is an interest-bearing obligation. P. 293 U. S. 86.

3. The presumption that identical words used in different parts of the same Act are intended to have the same meaning yields where words susceptible of different shades of meaning are found in such dissimilar connections as to show that they were employed in different senses. P. 293 U. S. 87.

4. Section 213(b)(4) of the Revenue Act of 1926, providing that the term gross income shall not include interest upon "obligations of the United States," was designed to aid the borrowing power of the Government by making its interest-bearing bonds attractive to investors, and the scope of the term must there be narrowed accordingly; but § 217(a) is for the different purpose of producing revenue, and must be construed from that standpoint. P. 293 U. S. 91.

5. The United States is a "resident" within the meaning of the phrase "residents, corporate or otherwise," in § 217(a) of the Revenue Act of 1926. P. 293 U. S. 91.

6. The rule that taxing acts are to be construed strictly in favor of the taxpayer cannot be allowed to defeat the obvious legislative intent when ascertained from the context and purpose of the statute and other appropriate tests. P. 293 U. S. 93.

62 App.D.C. 360, 68 F.2d 407, reversed.

Certiorari, 292 U.S. 618, to review the affirmance by the Court of Appeals of an order of the Board of Tax Appeals avoiding a deficiency assessment of income taxes.

Page 293 U. S. 85

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