Inconsistent orders and disregard for Tribunal – hallmark of Income Tax department?

By Vijay Kumar

The Income Tax department was at the receiving end of the High Court’s anguish. The High Court noted that the principle of consistency must apply and on the same facts, unless there is some warrant for doing so, the Assessing Officer must follow a consistent pattern. For the first nine assessment years, the Assessing Officer assessed the income as salary income and then for the next 10 assessment years, the income was assessed as business income. The Tribunal, however, found this to be salary income. Thereafter, again for the next two assessment years, the income was assessed as salary income and then for the next two assessment years as business income and again for the next three assessment years as salary income.

See 2007-TIOL-53-HC-DEL-IT + 2007-TIOL-52-HC-DEL-IT which we are carrying today.