¶2The first assignment of error raises the question of whether or not a fine and penalty, court costs, and attorneys’ fees incurred in connection with the indictment of petitioner for violating the anti-trust law of Ohio, to which indictment petitioner pleaded guilty, may be deducted as ordinary and necessary expenses of petitioner’s business of manufacturing and selling bread. We are/ unable to agree with petitioner’s contention on this point. To be deductible under the law the expenditure must be both an ordinary and a necessary expense of taxpayer’s business.' Petitioner has failed to prove either of these essential conditions. The ruling of the Commissioner must be affirmed. Appeal of Sarah Backer, 1 B. T. A. 214; Appeal of John Stephens, 2 B. T. A. 724.
¶3The second assignment of error presents the question of the proper rates of depreciation on the taxpayer’s depreciable assets. The Board is satisfied that the rates claimed by the taxpayer are reasonable and should be used in computing the amount of the depreciation, except the rate on buildings, which should be 2y2 per cent, and the rate on office furniture and fixtures, which should be 10 per cent.
¶4The Commissioner’s adjustment of invested capital in respect to income and profits taxes for prior years appears to have been made *1129in accordance with the regulations in force as to the year 1918, and in view of the provisions of section 1207 of the Revenue Act of 1926. such adjustment may not now be modified.
¶5Order of redetermination will be entered on 15 days' notice, under Rule 50.