Mahlon Pitney

“ It is more reasonable to say that Congress deemed that where the indebtedness does exceed the capital it should no longer be treated as an incident, but that the carrying of the indebtedness should be considered as a principal object of the corporate activities, that the operations of such a corporation are conducted more for the benefit of the creditors than of the stockholders, and that the contribution of the corporation to the expenses of the government should be admeasured with this fact in view. ”

“ It is not necessary to attribute to Congress a purpose to discourage or impose an extra burden upon corporations carrying on their operations with a nominal capital stock, or with an indebtedness largely exceeding the amount of the capital. ”

“ And it is very clear, from a reading of § 38, that the phrase 'entire net income,' as used in its first paragraph, has no other meaning than that which is particularly set forth in the second paragraph, which declares, in terms, how 'such net income shall be ascertained.' It may well be that mortgage interest may, under special circumstances, be treated as among the 'ordinary and necessary expenses,' or as included among the charges 'required to be made as a condition to the continued use or possession of property.' See 28 Ops. ”