In the Hormel v. Helvering case of 1940, the Supreme Court ruled in favor of the Commissioner of Internal Revenue, Guy T. Helvering. The dispute arose when Jay C. Hormel sought to deduct losses from his income tax that he incurred due to a decline in value for stocks and bonds held by him as trustee under his father's will during 1932-33 period but not sold until later years. However, these deductions were denied by the IRS on grounds that they should have been claimed in earlier years when depreciation occurred rather than at time of sale or exchange as per Section 23(e) (2) and (f) provisions of Revenue Act 1928. The court upheld this decision stating that it was within its jurisdiction to determine whether such claims could be made retrospectively or not based on circumstances presented before them even if new evidence was introduced at appellate level which wasn't available during original proceedings before Board of Tax Appeals.

In the dissenting opinion for Hormel v. Helvering, it was argued that the majority's decision to allow a tax court to consider new evidence on appeal undermines the finality of judgments and disrupts established legal procedures. The dissent emphasized that allowing such an action would set a dangerous precedent where cases could be endlessly re-litigated with new evidence, undermining confidence in judicial decisions. It was also pointed out that this approach unfairly disadvantages taxpayers who do not have access to similar resources as government agencies like IRS, thus creating unequal treatment under law. Furthermore, they contended that if there were indeed errors in original proceedings or significant new evidence emerged later on, these should be addressed through separate mechanisms like motions for rehearing or filing a fresh suit rather than altering appellate procedure itself.