OPINION.
Harlan, Judge:
Petitioner contends that 60 per cent of the net profits from the operation of El Fenómeno mine is excludible by him in computing his taxable income for the taxable years.
Subsequent to the trial in this proceeding, the Supreme Court of the United States, on April 22, 1946, rendered its decision in Burton-Sutton Oil Co. v. Commissioner 328 U. S. 25, which case, in its essential facts, is on all fours with the instant proceeding. The Court held that payments by a lessee to a lessor of a proportion of the profits from mining operations constituted rents or royalties and not capital investments, and were excludible by the lessee from gross receipts for income tax purposes. Following this decision, we reach the same conclusion in this proceeding and hold that payments of 60 per cent of the net profits from the operation of the El Fenómeno mine, made by petitioner to Lee during the taxable years, are excludible from his gross income for those years.
Reviewed by the Court.
Decision will be entered wnder Rule 60.