In the 1922 case of Russell Motor Car Company v. United States, the Supreme Court ruled in favor of the U.S. government regarding a dispute over import duties on automobile parts. The Russell Motor Car Company had imported unassembled car parts from Canada and argued that they should be classified as "parts" for tariff purposes, which would result in lower duty rates than if they were considered complete automobiles. However, because these components constituted virtually all necessary elements to assemble a functioning vehicle (with only minor items like oil and gasoline needed), the court determined that they essentially represented disassembled cars rather than mere spare parts. Therefore, it upheld their classification as complete vehicles by customs officials and confirmed that higher tariffs applied accordingly.

The dissenting opinion in the case of Russell Motor Car Company v. United States disagreed with the majority's interpretation of the Revenue Act of 1918. The dissent argued that Congress intended to tax only those profits derived from property sold during the taxable year, not those realized through an increase in value over several years. They contended that interpreting otherwise would result in a retroactive taxation which is generally disfavored unless explicitly stated by law. Furthermore, they believed this interpretation was unfair as it could lead to businesses being taxed on unrealized gains or losses due to market fluctuations outside their control and unrelated to any actual transactions conducted within the taxable year.