
    FORD v. COMMISSIONER OF INTERNAL REVENUE.
    No. 5100.
    Circuit Court of Appeals, Third Circuit.
    Sept. 15, 1933.
    John Hemphill, of Philadelphia, Pa., for petitioner.
    Sewall Key, J. Louis Monarch, and F. Edward Mitchell, Sp. Assts. to Atty. Gen. (C. M. Charest, Gen. Counsel, Bureau of Internal Revenue, and C. C. Holmes, Sp. Atty., Bureau of Internal Revenue, both of Washington, D. C., of counsel), for respondent.
    Before BUFFINGTON, DAVIS, and THOMPSON, Circuit Judges.
   THOMPSON, Circuit Judge.

This is a petition for review of a decision of the Board of Tax Appeals. The estate of Albert E. Ford, deceased, held 2,128 shares of common stock of the Franklin Trust Company. That company authorized an issue of additional shares of common stock, and gave its stockholders the right to subscribe to such new shares at $400 each at the rate of one-half a share of new stock for each one share of stock held. The administrators, pendente lite, therefore had the right to subscribe to 1,064 new shares, but were unable to exercise these rights because of lack of available funds with which to purchase the now shares. They petitioned and obtained leave of the orphans’ court of Philadelphia county to subscribe to as many new shares of common stock of the Franklin Trust Company as could be taken up with funds realized from the sale of the balance of the rights to which the estate was entitled. The administrators thereupon sold 1,548 half rights for $116,046. Wi4h the proceeds of this sale, they purchased 290 new shares at $400 each, using the- unsold 580 half rights.

The Commissioner of Internal Revenue asserted that the sale of the rights to subscribe resulted in taxable gain and assessed a deficiency. The Board of Tax Appeals found that a profit was realized on the sale of the rights, and affirmed the ruling of the Commissioner. We find no error in the reasons and conclusion of the Board of Tax Appeals.

The decision is sustained, and the petition for review is dismissed.  