¶1dissenting: Essentially the same issue as is before us here was considered and decided in City Bank Farmers’ Trust Co. v. Bowers, 68 F. 2d 909, affirming 2 F. Supp. 883, and Rodiek v. Helvering, 87 F. 2d 328, affirming 33 B. T. A. 1020. Thus, it would appear that these cases are controlling here unless there has been a change in the governing statutory provisions.
¶2The applicable law in the City Bank Farmers’ Trust Co. case was the Revenue Act of 1918. The applicable law in the Rodiek case was the Revenue Act of 1926, as amended by the Revenue Acts of 1928 and 1932. In both these cases it was determined, after a consideration of the statutory language of the applicable revenue acts, that the full value of a nonresident decedent’s property, undiminished by the amount of any mortgage or pledge thereon, should be included in the gross estate. After an examination of sections 811, 812, and 861 (a) of the Internal Revenue Code, as well as all amendments and changes that have been made in the applicable statutory revenue law since the earlier revenue acts, I am convinced that there never has been any change in the statutory provisions with which we are concerned; furthermore, the only amendment thereto which was of any substance was a change in the provision allowing a deduction for unpaid mortgages appearing in the 1932 Revenue Act. However, this amendment was intended merely to clarify the existing law as is evidenced by the following comment appearing at page 48 of the House Ways and Means Committee Report on the 1932 Act:
This amendment, with one exception, merely clarifies the existing law so far as it relates to an important group of deductions allowable in computing the net estate subject to estate tax. The principal changes made are:
(1) A more definite statement that, in order for a mortgage to be deducted, the full value of the mortgaged property must be included in the gross estate This change is merely for clarification.
¶3The conclusion must necessarily follow that the City Bank Farmers’ Trust Co. and Rodiek cases control the issue before us.
¶4It appears that the majority opinion’s refusal to follow the two cases cited above is based almost exclusively on the fact that a change has been made in a Treasury regulation since the Rodiek case was decided. Suffice it to say, I do not agree that the purpose of that regulation, as the majority opinion states, was to create a tax benefit for the estate of a nonresident alien to which benefit the estate would not be entitled under what I deem the correct interpretation placed on the statutory law in the City Bank Farmers' Trust Co. and Rodiek cases, supra. If, however, the majority opinion correctly interprets the intent of the regulation, the latter is, in my opinion, invalid as being contrary to the statutory provisions. I, therefore, dissent.