No. 588.–HIGH COURT OF JUSTICE (KING’S BENCH DIVISION).–

4TH AND 5TH NOVEMBER, 1926.

Income Tax, Schedule D – Sales of land – Whether profits from trade or from realization of assets.

  In 1876 the State of Alabama defaulted in respect of a loan and transferred certain lands to trustees for the benefit of such bondholders as surrendered their bonds within 10 years. The trustees were to sell the lands, to pay 10 per cent. of the proceeds to the State until the interest paid on the bonds prior to default had been covered, and to distribute the balance to the bondholders.