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2022 (9) TMI 1081 - AT - Income TaxRevision u/s 263 by CIT - application of principle of consistency - Judicial discipline - assessee had made a claim to be surplus through audit trial that assessee had made a provision on account of anticipated loss that was debited to its profit and loss - assessee was following the percentage completion method from year to year for computing the income of the Assessee - As per CIT, AO failed to examine the factual aspect ignoring the provisions of Section 145(1) and (2) of the IT Act AND the loss to be contingent nature and therefore, disregarded assessee’s recognized income or loss percentage computation method (POCM) as prescribed in the accounting standard-(AS)7 - HELD THAT:- In the present case as Revenue has accepted the Accounting Method followed by the Assessee for year to year, in the middle of the completion of the project, neither the AO nor the PCIT can not disturb the method of accounting followed by the Assessee, if the accounting method is allowed to be disturb on an assessment year, which will give distort picture of the Assessee’s financial position. Thus the Order passed by the AO cannot set to be erroneous if the same view that of the earlier years has been accepted by the AO in the year under consideration, thus the Ld. A.O. has applied his mind and came to the correct conclusion. The Ld. PCIT cannot interfere in an issue which has been accepted by the Revenue for number of years. When the facts in the Assessment year are same that of the Earlier Years, then the AO cannot take contrary view to the view taken in the earlier years. As the AO has accepted the accounting method followed by the assessee from year to year, in the relevant Assessment Year, the AO cannot take contrary view. Where facts and law in a subsequent assessment year are the same, no authority whether quasi judicial or judicial can generally be permitted to take a different view. This mandate is subject only to the usual gateways of distinguishing the earlier decision or where the earlier decision is per incuriam. However, these are fetters only on a coordinate bench which, failing the possibility of availing of either of these gateways may yet differ with the view expressed and refer the matter to a bench of superior strength or in some cases to a bench of superior jurisdiction. In the absence of any material change justifying the Revenue to take a different view of the matter-and if there was no change it should be in support of the assesses-we do not think the question should have been reopened and contrary to what had been decided by the A.O in the earlier proceedings. Invoking jurisdiction u/s. 263 of the Act by the Ld. PCIT is bad in law, accordingly we quash the impugned order of the Ld. PCIT passed under section 263 of the Act. - Decided in favour of assessee.
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