Blair

.This is an appeal from a judgment of the Board of Tax Appeals, sustaining a disallowance by the Commissioner of a claim of deductible loss arising out of the destruction by fire of a unit of the appellant’s lumbering plant at Klamath Ealls. Touching the material facts there is no controversy. In 1915, or at least subsequently to March 1, 1913, appellant constructed this unit at a cost of $124,641.25. It was destroyed in September, 1919, at which time its depreciated cost was $98,202.83. Insurance was collected in the amount of $164,-832.64 and there was a salvage of $1,267.68. Electing to rebuild, appellant began construction immediately after the loss was adjusted, and completed the new unit, which was substantially a duplication of the old, in April, 1920, at a total cost of $315,816.95. In its tax return for 1920 it deducted from gross income $123,278.81, which it computed as a loss by deducting from the total cost of the new unit the sum of the accrued depreciation on the old plant, $26,418.42, salvage, $1,267.68, and insurance received, $164,832.-64- — a total of $192,538.14. Holding that there was no deductible loss, the Commissioner disposed of the matter by directing a…