Palmer v. Bender, 287 U.S. 551 (1933)
U.S. Supreme CourtPalmer v. Bender, 287 U.S. 551 (1933)
Palmer v. Bender
Argued December 14, 15, 1932
Decided January 9, 1933
287 U.S. 551
Section 214 of the Revenue Act of 1921 directs that a reasonable allowance for depletion be made as a deduction in computing net taxable income, "in the case of oil and gas wells . . . according to the peculiar conditions of each case:"
1. That the interests to which the allowance applies are determined by the statute itself, as construed, and not by their formal characterization in the local law. P. 287 U. S. 555.
2. A lessee of oil wells who transfers them to another, stipulating for a royalty or bonus from oil to be produced, thereby retains an economic interest in the oil in place, which is depleted by production and which comes within the meaning and purpose of the statute, whether his conveyance be deemed by the law of the state a sublease or an assignment. P. 287 U. S. 558.
57 F.2d 32 reversed.
Certiorari to review the affirmance of a judgment, 49 F.2d 316, denying in part the petitioner's claim in an action to recover money paid as income taxes. The action was begun against the Collector, and the administratrix was substituted upon his death.