Helvering

Petitioners seek a review of the decision of the Board of Tax Appeals sustaining deficiency tax assessed upon the incomes of the petitioners for their taxable year ending April 30, 1921. A consolidated return was filed by the Zellerbach Paper Company and its affiliated corporations, the National Paper Company, and the A. S. Hopkins Company, on July 16, 1921, while the Revenue Act of 1918 ( 40 Stat. 1057 ) was in force and before the enactment of the Revenue Act of 1921 ( 42 Stat. 227 ), which was made retroactively effective to January 1, 1921. Tax was fixed against each of the corporations on the consolidated return. This consolidated return showed a gross income of $5,826,652.14, credits and deductions claimed of $5,067,846.02, net income of $758,546.17. The original return is before us and we summarize its contents in the language of the petitioners’ brief:

The Commissioner’s audit of the return attached to the deficiency letter covers 29 pages of the transcript and shows net income for the Zellerbaeh Paper Company of $774,-423.89, an increase of not income of $242,-185.60, and an increase of tax of $64,024.37; a net income of $355,297.11, an increase of tax of $31,141.52, for…