53 STAT.] 76TH CONG., 1ST SESS.-CH. 247-JUNE 29, 1939 District Court of the United States for the District of Columbia if the property subject to the lien is situated in the District of Columbia. "(b) (1) ExcEPrrio IN CASE OF SECURITIES.-Even though notice of a lien provided in section 3670 has been filed in the manner pre- scribed in subsection (a) of this section, or notice of a lien provided in section 3186 of the Revised Statutes, as amended, has been filed in the manner prescribed in such section or subsection (a) of this section, the lien shall not be valid with respect to a security, as defined in paragraph (2) of this subsection, as against any mort- gagee, pledgee, or purchaser, of such security, for an adequate and full consideration in money or money's worth, if at the time of such mortgage, pledge, or purchase such mortgagee, pledgee, or pur- chaser is without notice or knowledge of the existence of such lien. "(2) DEFINITION OF SECURITY.-As used in this subsection the term 'security' means any bond, debenture, note, or certificate, or other evidence of indebtedness, issued by any corporation (including one issued by a government or political subdivision thereof), with interest coupons or in registered form, share of stock, voting trust certificate, or any certificate of interest or participation in, certificate of deposit or receipt for, temporary or interim certificate for, or warrant or right to subscribe to or purchase, any of the foregoing; negotiable instrument; or money. "(3) APPLICABILITY OF sUBSECTION.- Except where the lien has been enforced by a proceeding, suit, or civil action which has become final before the date of enactment of the Revenue Act of 1939, this subsection shall apply regardless of the time when the mortgage, pledge, or purchase was made or the lien arose." SEC. 402. TAX ON TRANSFERS OF WORTHLESS SECURITIES BY EXEC- UTOR, ETC. Section 1802 (b) of the Internal Revenue Code (relating to the tax on transfers of capital stock and similar interests) is amended by inserting at the end thereof the following new paragraph: "The tax imposed by this subsection shall not be imposed upon any delivery or transfer by an executor or administrator to a legatee, heir, or distributee of shares or certificates of stock if it is shown to the satisfaction of the Commissioner that the value of such shares or certificates is not greater than the amount of the tax that would otherwise be imposed on such delivery or transfer." SEC. 403. CREDITS AGAINST ESTATE TAX OF TAX PAID TO POSSES- SIONS. (a) Section 813 (b) of the Internal Revenue Code (relating to the 80 per centum credit for estate, legacy, succession, and inheritance taxes paid) is amended by inserting after "District of Columbia," the following: "or any possession of the United States,". (b) The amendment made by subsection (a) shall be applicable only with respect to estates of decedents dying after the date of the enactment of this Act. SEC. 404. RETURNS BY ATTORNEYS AS TO FOREIGN CORPORATIONS. Effective as of the date of the enactment of the Internal Revenue Code, section 3604 of such Code is amended by striking out "Nothing in this section shall be construed to require the divulging of privileged communications between attorney and client." and inserting in lieu thereof "Nothing in this section shall be construed to require the 883 Exception in case of securities. Ante, p. 448. I.R. C. §3670. R.S. §3186. Ante, pp. 448 -450 . I. R . C. §§3670-3677. "Security" defined. Applicability of sub- section. Transfers of worth- less securities by ex- ecutor, etc. Ante, p. 196. I. It. C . §1802 (b). Credit against es- tate tax of tax paid to possessions. Ante, p. 125. I.R . C. 813(b). Applicability. Returns by attor- neys as to foreign cor- porations. Ante, p. 436 . I.R.C.§3604.
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