In the case of Corn Products Refining Co. v. Commissioner of Internal Revenue, 1955, the U.S Supreme Court ruled on whether profits from corn futures contracts should be considered as capital gains or ordinary income for tax purposes. The company had been buying these contracts to protect against price fluctuations in its primary raw material - corn. The IRS argued that these were capital assets and any profit made from them should be taxed as a capital gain at a lower rate than ordinary income. However, Corn Products contended that they were part of their regular business operations and thus should be treated as ordinary income which is subject to higher taxes but can also offset losses more effectively. The court sided with the IRS ruling that since these futures contracts weren't directly related to the company's manufacturing process nor sold to customers, they are indeed capital assets under tax law definitions at that time (Section 117(a) of Internal Revenue Code). This decision set an important precedent regarding how derivative financial instruments like futures contracts are classified for taxation purposes.

In the dissenting opinion for Corn Products Refining Co. v. Commissioner of Internal Revenue, it was argued that the majority's decision to treat futures contracts as capital assets rather than ordinary business expenses contradicted established tax law principles and previous court rulings. The dissent emphasized that these contracts were a regular part of the company's operations, used to protect against price fluctuations in corn - their primary raw material. Therefore, they should be considered an ordinary and necessary business expense deductible from gross income under section 23(a) of the Revenue Act instead of being treated as capital gains or losses subject to different tax rules under section 117(j). This interpretation would align with Congress' intent when drafting these provisions: promoting economic stability by allowing businesses to deduct all reasonable costs incurred in carrying out their trade or profession.