IN THE INCOME TAX APPELLATE TRIBUNAL DELHI (DELHI BENCH ‘G’ NEW DELHI)

BEFORE SHRI M. BALAGANESH, ACCOUNTANT MEMBER AND SH. YOGESH KUMAR U.S., JUDICIAL MEMBER ITA No. 1987/Del/2025 (A.Y. 2020-21)

Mahasian Di Hatti (P) Ltd. Vs Pr. Commissioner of Income C/o Vinod Kumar . Tax-4 Bindal& Co. D-219, 2nd Floor, Central Revenue VivekVihar, Phase-1, New Building, ITO, Delhi New Delhi PAN:AAACM4165F Appellant Respondent Assessee by Sh. VinodBindal, CA, Ms. Rinki Sharma, ITP, Sh. Saurabh Sharma, Adv and AnmolJha, Adv Revenue by Sh. Mahesh Kumar, CIT(DR)

Date of Hearing 07/08/2025 Date of Pronouncement 10/09/2025 ORDER PER YOGESH KUMAR, U.S. JM:

The present appeal is filed by the Assessee against the order of the Principal Commissioner of Income Tax-4, Delhi (‘Ld. PCIT’ for short) dated 27/03/2025 pertaining to Assessment Year 2020-21.

2. The grounds of Appeal are as under:-

“1. The PCIT-4, New Delhi erred in law and on facts in passing the impugned order u/s 263 of the Act cancelling the entire assessment order passed earlier u/s 143(3) of the Act by the Assessment Unit NFAC on 25/08/2022 and directing the AO to pass fresh assessment order in terms of directions given in the impugned order though the earlier assessment order was not at all erroneous and prejudicial to the interest of the Revenue. Thus, the said order must be declared as bad in law and be quashed.

2. The PCIT-4. New Delhi erred in law and on facts in directing the AO to re-examine all issues which do not affect the assessment order in any manner depending on the past history as well as nature of business of the assessee. Thus, the impugned order passed on a change of opinion must be cancelled.

3. The PCIT-4. New Delhi concluded the proceedings in a lopsided manner after conducting the hearing last on 23-09 2024 and thereafter the fresh notice was issued only on 18:03 2025 calling for no fresh information despite the fact that all information containing pages 1-1182 in the following written submissionsfiled online on 05/02/2024, 12 02 2024, 27.02 2024. 17 07 2024. 23/09/2024. 22/03/2025 and 25/03/2025 and physically also. Thus, the principle of natural justice has been violated besides cancelling the earlier order u/s 143(3) of the Act without showing as to how the same was not only erroneous but also prejudicial to the interest of the revenue.

4. The impugned order passed u/s 263 of the Act lacks the two mandatory conditions being erroneous and prejudicial to the interest of the Revenue needs to be quashed.”

3. Brief facts of the case are that, the Assessee filed its income tax return on 14/02/2021 declaring total income of Rs. 6,20,33,84,130/-. The return of income of the Assessee was picked up for ‘Complete Scrutiny’ by the ACIT, NAFAC-1 (1)(2) Delhi u/s 143(2) of the Act by issuing notice dated 29/06/2021 on the issue of ‘stock valuation’,‘loss from currency fluctuations’ and ‘refund claim’. In response to the notice, the Assessee produced details to NFAC. The NFAC vide order dated 25/08/2022, assessed the income of the Assessee at the returned income.

4. The Ld. PCIT on perusal of the assessment records was of the opinion that the Assessing Officer, had not verified/examined following issues before passing the Assessment Order and prima facie considered that the assessment order being erroneous in so far as it is prejudicial to the interest of the Revenue for following reasons:-

“a) On perusal of the assessment records, it was observed that there was sharp increase of Rs. 14,49,91,615/- under the sub-head "Advance for properties and Rs.

42,85,51,442/- under sub-head "Advance to suppliers".

(b)That on perusal of Column No. 23 of Form 3CD & P&L statement, it was observed that the assessee has made substantial payment of Rs. 257 Cr. to related parties under various heads during the year under consideration;

(c)That payment of Rs. 12,00,00,000/- under the head Commission to Directors was made during the year under consideration. Further perusal of column no. 23 of Form 3CD, revealed