United States Supreme Court Cases & Opinions

U.S. Supreme Court

Group No. 1 Oil Corp. v. Bass, 283 U.S. 279 (1931)

Group No. 1 Oil Corp. v. Bass

No. 425

Argued February 26, 1931

Decided April 13, 1931

283 U.S. 279

Syllabus

Leases by the Texas to a private corporation granted, for a term of years with privilege of renewal, the right to enter on designated lands of the state public domain for the purpose of drilling and operating for oil and gas and to erect and maintain all necessary structures for the production, transportation and storage of those products. They required the lessee or owner of the rights conveyed to pay the state the value of one-eighth of the oil produced and of one-tenth of the gas sold. As construed by the state supreme court, such leases effect present sales to the lessee of the oil and gas in place. Held, that the profits derived by the lessee from the sale of oil and gas produced, after deducting the state's royalties, are not immune from federal taxation upon the ground that the leases are state instrumentalities. P. 283 U. S. 281.

41 F.2d 483 affirmed.

Certiorari, 282 U.S. 830, to review a judgment reversing a judgment against the Collector for money collected

Page 283 U. S. 280

by him as income taxes. For the District Court's opinion, see 38 F.2d 680.