ITAT reaffirms Principle of Consistency: Directs AO to Retain Long-Standing Expense Allocation Method for Sysmex India Pvt Ltd

The Income Tax Appellate Tribunal (ITAT) has directed an Assessing Officer to adhere to the "principle of consistency" in a case involving Sysmex India Pvt. Ltd. The tribunal instructed the AO to retain the long-standing method of allocating expenses that had been accepted by the tax department in the company's assessments for previous years. The department had sought to change this method in the current assessment year, leading to a dispute. The ITAT observed that unless there is a material change in the facts or the law, the revenue department should not be permitted to deviate from a position that has been consistently accepted in the past. This principle ensures predictability and certainty for taxpayers and prevents arbitrary changes in assessment methodology by tax officers. The ruling underscores the importance of consistency in tax administration to maintain fairness and prevent unnecessary litigation.