Brantman

This is a suit for the refund of taxes, alleged to have been erroneously and illegally assessed and collected. Jurisdiction is vested in this Court pursuant to- 28 U.S.C. § 1346 (a) (1) (Supp. V).

The taxpayers, who are citizens of the United States, are shareholders of corporations which are resident in the Crown Colony of Singapore. In the years 1951, 1952, and 1953 these corporations declared dividends in favor of plaintiffs aggregating $18,855.15. Before paying these dividends to the plaintiffs, the corporations deducted sums aggregating $5,614.52 as taxes due the government of Singapore, pursuant to Crown Colony of Singapore, The Income Tax Ordinance, 1947 § 40, 1 and paid this amount to the Colony. Thus, the net proceeds received by the taxpayers during the three years totalled $13,240.63.

Plaintiffs reported the gross dividends declared as dividends received on their United States income tax returns for the years in question and claimed a credit against the United States tax due in the amounts deducted by the corporations for Singapore taxes. This credit was claimed as a foreign tax paid pursuant to Int.Rev.Code, § 131 (1939), 26 U.S.C. § 131 . 2

*887 On April 1, 1955…