Earlier year decision is not binding on assessee or department in subsequent year

S.P. Chips Potato Pvt. Ltd Vs DCIT (ITAT Ahmedabad)

Held that principle of res judicata is not applicable to decision of revenue authorities and, therefore, decisions given in an assessment for an earlier year are not binding either on assessee or on department in a subsequent year.

Facts-

The case of the assessee was selected for scrutiny and the assessee claimed depreciation @30% on opening WDV of Rs 22.95 lakhs under the head “plant and machinery”. Pr. CIT noticed that no such asset eligible for depreciation @30% is found under the head “plant and machinery”. It was also noticed that depreciation allowable to the assessee under the head “plant and machinery” would be @15% and not @30% and therefore, excess depreciation was incorrectly allowed to the assessee @30%.

Pr. CIT rejected the contention of the assessee and set aside the assessment order.

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