
    The People of the State of New York ex rel. Frederick W. Bass et al., Appellants, v. M. Frank Loughman et al., Constituting the State Tax Commission, Respondents.
    
      Tax — income tax ■— partnership — income received by surviving partners and paid to estate of deceased partner pursuant to terms of partnership agreement — assessment of income tax thereon proper.
    
    
      People ex rel. Bass v. Loughman, 218 App. Div. 795, affirmed.
    (Argued November 16, 1926;
    decided November 30, 1926.)
    Appeal, by permission, from an order of the Appellate Division of the Supreme Court in the third judicial department, entered November 12,1926, which confirmed, on certiorari, a determination of the State Tax Commission assessing an additional income tax against the relators. The question was whether partnership income received by surviving partners and paid over to the estate of a deceased partner, pursuant to the terms of the partnership agreement, should be taxed as income to the surviving partners or as income to the estate of the deceased partner. The Appellate Division held that the payment was one of principal for the deceased partner’s interest in good will and that an income tax was properly assessed against the surviving partners for the amount thereof.
    
      Harold R. Medina and Rufus Cole Van Ahen for appellants.
    
      Albert Ottinger, Attorney-General (Henry S. Manley of counsel), for respondents.
   Order affirmed, with costs; no opinion.

Concur: His cock, Ch. J., Pound, Crane, Andrews and" Lehman, JJ. Dissenting: Cardozo and McLaughlin, JJ.  