In Busey et al. v. District of Columbia, 1942, the U.S Supreme Court dealt with a case concerning taxation and property rights in Washington D.C. The appellants were owners of land that had been condemned by the District for public use as part of a highway project but was later abandoned due to changes in plans. When the District sought to return this unused land back to its original owners, it also demanded payment for taxes on these properties during the period they were held by the government under condemnation proceedings. The appellants argued against paying such taxes since they did not have possession or control over their lands during this time frame. The court ruled in favor of the District stating that despite being deprived of physical possession and control over their properties due to condemnation proceedings, ownership remained vested with them throughout this period; hence they are liable for tax payments on these lands.

In the dissenting opinion for Busey et al. v. District of Columbia, it was argued that the majority's decision to uphold a tax on gross receipts from public utilities operating in Washington D.C., including those received from federal agencies, infringed upon federal sovereignty and violated constitutional principles. The dissent maintained that this taxation constituted an indirect levy on the United States government itself as these costs would inevitably be passed onto them through increased utility rates. They contended that such a tax could potentially disrupt or influence governmental operations by making them subject to local control and financial burdens imposed by individual states or municipalities where they operate, which is contrary to established legal precedents protecting federal activities from state interference.