The opinion
Murdock,
dissenting: The evidence shows that the petitioner was never entitled to inventory his securities for income tax purposes. The statute fixes but one basis for determining his gain or loss upon the sale of securities. That basis is cost. Sec. 113 (a), Revenue Act of 1928. Cost means the amount which he paid for the securities. It is a distortion of the term “cost” to interpret it as meaning the original cost adjusted for such changes, resulting from the unauthorized use in prior years of inventories, as will bring the petitioner and the Commissioner into balance in regard to income tax. If he had been entitled to inventory these securities in 1930, then his closing inventory figures would be a proper basis. See section 113 (a) (1) of the Revenue Act of 1928. But, since he was not entitled to use inventories in 1930, the closing inventory which he erroneously used is not his basis. The function of the Board is to decide correctly the petitioner’s income tax liability for the year before it. It should not distort the law in order to correct mutual errors which *489 the taxpayer and the Commissioner have made in prior years; to attempt to do so will lead to hopeless confusion. I think the prevailing opinion is in error in permitting the use of a figure other than cost as a basis for computing the petitioner’s losses from sales of securities. ■
Leech agrees with this dissent.