The opinion
Nims, J., concurring: Sections 302(b)(1) and 302(b)(3) focus our attention on whether there has been a complete termination of interest, whereas section 453(b) focuses on how the termination was accomplished. I think it is essential to bear this distinction in mind to rebut any imputation that we are shifting our ground in the middle of the case. A simple illustration illuminates the point: If A sells 50 percent of his X Corporation stock to B for cash, and the remaining 50 percent to C for an installment note, A has terminated his interest in X Corporation, but no one would seriously argue that the sale to B tainted the sale to C. I can visualize no policy reason why, absent the peculiarities of a case like Farha v. Commissioner, 58 T.C. 526 (1972), affd. 483 F.2d 18 (10th Cir. 1973), X Corporation’s redemption of 50 percent of the stock for cash and C’s purchase of 50 percent for an installment note should be treated any differently. This I perceive to be the essential rationale of our decision.
Kórner and Hamblen, JJ., agree with this concurring opinion.