Rule of consistency clearly do not play much role in the matter of claim for deduction of business expenditure in a particular assessment year.
In [2024] 169 taxmann.com 202 (Delhi)[09-07-2024] the assessee allegedly engaged in money lending business claimed deduction of expenses such as salary, repair and maintenance, vehicle running and maintenance and depreciation etc. even when it earned no interest income during the year. To justify it made a claim that it has been in money lending business and it has earned interest incomes in preceding and succeeding years but in the relevant year the business was dormant. However because of rule of consistency it should be allowed deduction of expenses as the same are allowed in succeeding and preceding years.
The High Court did not budge to rule of consistency argument to allow business expenditure of Rs. 43,62,446/- against nothing.