In Principal Commissioner of Income Tax v. M/s Quest Investment Advisors Pvt. Ltd, under Income Tax Appeal No. 280 OF 2016 – High Court of Bombay dealt with “Res Judicata” and “Principle of Consistency” as held as under:
1.Whether the Tribunal was justified in deleting the disallowance made under Section 37(1) of the Income Tax Act, 1961 without paying heed to the facts of the case and the legal matrix as highlighted by the Assessing officer and the CITA?
2.Whether the Tribunal was justified in following the ‘Principle of Consistency’ without paying heed to the facts and the circumstances of the case?
The Honourable High Court of Mumbai held as below::
1.“Principle of res judicata” does not apply in matters pertaining to tax for different assessment years.
2.The duty of the Revenue is to adhere to a consistent practice which has been accepted and followed.
3.“Principle of Consistency” can be changed only if there is a change in law or facts – not otherwise.
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