The opinion
Whitaker, Judge,
dissenting:
I am unable to agree with the majority opinion in this case. What the act requires to entitle a taxpayer to a deduction for a bad debt is (1) ascertainment of worthlessness, and (2) affirmative evidence in its books or records, if it kept any, that it had ascertained in the taxable year that the debts were worthless. The act does not require that the debt be charged off on the taxpayer’s boohs of accoum>t; it merely requires that they “be charged off”.
Here we have a minute o.f the taxpayer’s supreme governing body resolving that the debts “be' charged off.” This minute appears in the taxpayer’s permanent records. This is the highest evidence of the fact that the taxpayer had ascertained the debts to be worthless in the taxable year. It is evidence at least equally cogent with that of an account book entry. We have previously so held. First State Bank of Stafford, Kansas, v. United States, 67 C. Cls. 332 . Cf. Cammack v. United States, 113 Fed. (2d) 547.
The fact that a charge-off was not made on the books of account is not.evidence that the taxpayer had changed its. mind about the worthlessness of the debts, since it failed to take this action only for the reason that the bank examiner had so directed. And he so directed not because he had changed his mind about the worthlessness of the debts but only because he thought it inadvisable for the bank’s then condition to be reflected in its statement.
I think the plaintiff is entitled to recover.