At the time of the purchase by the taxpayer of a control block of the shares of a public company (Foresbec), it and Foresbec "granted" to the vendor corporation a contract for the services of a former executive of Foresbec who was associated with the vendor.
Foresbec, by making payments to the vendor under that contract, conferred a benefit on the taxpayer. It was never contemplated that the consulting contract would be implemented and all that it provided for was an obligation to make the payments irrespective of the provision of any services.