The opinion
L. HAND, Circuit Judge
(dissenting).
In spite of the contrary ruling for nine years in the treasury and its very belated change of front, it appears to me that the intent is too plain for latitude of interpretation, though of course in view of the difference of opinion that has arisen I cannot feel as sure as T should, if tho matter had come before me first. Section 23 (n) (2), 26 US CA § 2023 (n) (2), puts a limit upon charitable gifts of “15 per centum of the taxpayer’s net income as computed without the benefit of this subsection”; so that in first computing the net income all charitable gifts must be omitted. That gives a net income, but only tentatively; all charitable gifts may be then deducted until they reach the prescribed limit, which is 15 per cent, of the net income, already provisionally computed. Thus the final taxable income is computed in two steps. If that he so> it appears to mo that section 101 (c) (7), 26 USCA § 2101 (e) (7), becomes plain. The “ordinary net income” there defined is to he “computed in accordance with the provisions of this title,” which as regards charitable gifts means that the limit must he fixed on a tentative net income. However, it is to he so computed only after excluding certain items; and “excluding” seems to me necessarily to relate to the first computation. It would be very unreal to suppose that it referred to the deduction of items not “excluded” but once included in the provisional computation; that after they had been included, and 15 per cent, of the result deducted, the same items should be reversed; the gains subtracted and the losses added. That is not “excluding-” them from the computation; “excluding” means dealing- with them oneo and for all. But if it is possible to suppose that they were to affect the computation at all, the more natural way was to use tho definitions in (c), subd. (5)- and subd. (6), 26 USCA § 2101 (e) (5, 7), which had just been made; “eapital net gain” would bo subtracted from, or “capital net loss” added to, the net income. The definition would then have read: “ ‘Ordinary net income’ means net income computed in accordance with the provisions of this title after deducting ‘capital net gain,’ or adding ‘capital net loss.’ ” I think that the Board was right.