In the case of United States v. Consolidated Edison Co. of New York, Inc., 1960, the U.S Supreme Court ruled on a dispute over tax deductions related to wartime excess profits taxes paid by Consolidated Edison during World War II. The company had claimed these payments as business expenses in their federal income tax returns for 1943-45 and sought refunds after they were disallowed by the Commissioner of Internal Revenue. The court held that these payments did not qualify as ordinary and necessary business expenses under section 23(a)(1)(A) of the Internal Revenue Code because they were essentially capital outlays made to protect or promote its capital structure rather than regular operating costs incurred in carrying on its trade or business. Therefore, such payments could not be deducted from gross income when calculating taxable income for those years.

In the dissenting opinion for United States v. Consolidated Edison Co. of New York, Inc., Justice Brennan argued that the majority's decision to allow a utility company to deduct from its federal income tax payments made in lieu of taxes was incorrect. He contended that this interpretation contradicted both legislative intent and previous court rulings on similar issues. According to him, such payments should not be considered as deductible because they were not actual taxes but rather voluntary contributions made by the company with an expectation of receiving benefits in return. Furthermore, he pointed out that allowing these deductions would result in significant revenue losses for the government and could potentially encourage other companies to seek similar arrangements thereby undermining public finance system.