In that case, decided under the old Bankruptcy Act and before the Bankruptcy Code was enacted (Bankruptcy Reform Act of 1978, Pub.L. 95–598, 92 Star. 2549), we held that where a bankruptcy court had decided all the issues that were before the Tax Court and the taxes had been assessed, the case should be dismissed for lack of “jurisdiction”. In reaching this result we relied upon Comas, Inc. v. Commissioner, 23 T.C. 8, 1954 WL 301 (1954). To understand the holdings in these cases, it is necessary to also understand the statutory context in which they arise.

Once the order of the bankruptcy court becomes final with respect to respondent's tax claims, generally neither the amount, nor the validity of the bankruptcy court's order is subject to review or reconsideration by this Court. McQuade v. Commissioner, 84 T.C. 137, 145 (1985); Comas, Inc. v. Commissioner, 23 T.C. 8, 12 (1954). As noted by the majority in its note 7, a decision entered approving a stipulated settlement agreement is an adjudication on the merits for purposes of res judicata.

McQuade v. Commissioner [Dec. 41,859], 84 T.C. 137, 140 (1985). Once the order of the Bankruptcy Court became final with respect to respondent's tax claims, generally neither the amount, nor the validity of the Bankruptcy Court's order is subject to review or reconsideration by this Court, McQuade v. Commissioner, supra at 145; Comas, Inc. v. Commissioner [Dec. 20,594], 23 T.C. 8, 12 (1954). As stated, upon dismissal of petitioner's appeal, the Bankruptcy Court's March 1, 1988, order became a final judgment rendered by a court of competent jurisdiction, and petitioner and respondent are the same parties that were involved in the bankruptcy proceedings.

As a result, mutuality of parties exists sufficient to activate the principle of estoppel, so that petitioner is not attempting to use ‘nonmutual offensive collateral estoppel‘ against respondent. The Bankruptcy Code, Pub. L. 95-598, 92 Stat. 2582, 11 U.S.C. section 505(a)(1) (1982 ed.), authorizes a bankruptcy court to ‘determine the amount or legality of any tax * * *.‘ This Court in Comas, Inc. v. Commissioner, 23 T.C. 8, 12 (1954), has concluded that ‘* * * Congress intended that once a bankruptcy court allowed a deficiency for which claim was filed and that court's action became final, the amount and validity of the deficiency was not thereafter to be the subject of a consideration by the Tax Court.‘