Rev. Rul. 54-353

Advice is requested whether a rectifier may use Spanish type blending sherry, produced under the provisions of section 178.174 of Regulations 7, in brandy and wine blends.

Section 178.174(c) of Regulations 7 provides in part that Spanish type blending sherry may be sold only to rectifiers for use in whisky blending. The reference to the use by rectifiers of Spanish type blending sherry in whisky blending, is considered to be illustrative only and does not preclude the use by rectifiers of this material in other rectified products, such as brandy and wine blends, subject to the rectification tax. Accordingly, it is held that rectifiers may use Spanish type blending sherry in brandy and wine blends which are subject to the rectification tax.