Frank

This appeal involves federal income taxes of two corporations. From which is the government entitled to collect? One has, by law, a preferential income tax basis over the other.

Plaintiff-appellee International Canadian Corporation (hereinafter referred to as "International”) paid $84,692.91 in taxes as reported on its timely return for its fiscal year ending April 30, 1953; defendant-appellant Frank (hereinafter referred to as “Commissioner”) then assessed a deficiency of $97,462.18 for the same taxable year and International paid the deficiency on October 3, 1956. On October 29, 1956, plaintiff-appellee Penn-salt Chemicals Corporation (hereinafter ref erred to as “Pennsalt”) paid a deficiency of $147,943.81 assessed by the Commissioner on Pennsalt’s taxable year ending December 31, 1952. Both eorpo-i'ations filed claims for refund on March 20, 1957; on May 20, 1957, International filed an amended claim for refund. The claims were not formally rejected by the Commissioner, but a six-month period had elapsed before these actions were begun. The timely actions in the district court for recovery of the taxes paid were consolidated for trial. The district court had jurisdiction…