STELLAR CAPITAL SERVICS LTD,DELHI vs. PCIT,-7, DELHI

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ITA 2612/DEL/2025Status: DisposedITAT Delhi08 December 2025AY 2018-19Bench: SHRIMAHAVIR SINGH, HON'BLE VICE PRESIDENT AND SHRISANJAY AWASTHI (Accountant Member)3 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found merit in the assessee's submission that the order was passed ex parte. Considering the denial of opportunity, the Tribunal set aside the impugned order and remanded the matter back to the Ld. PCIT for fresh adjudication.

What were the facts?

The assessee is aggrieved by an order passed by the Ld. PCIT under section 263 of the Income Tax Act, directing the AO to enhance the taxable income by disallowing remuneration paid to directors. The assessee contends that the order was passed ex parte despite opportunities not being availed.

What were the issues?

Whether the order passed by the Ld. PCIT under section 263 was bad in law due to being passed ex parte, denying the assessee an opportunity of being heard.

Which sections of the Income-tax Act were involved?

Section 263,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “B”NEW DELHI

Before: SHRIMAHAVIR SINGH, HON’BLE & SHRISANJAY AWASTHI

For Appellant: Ms. Pallavi, CA
For Respondent: Ms. Pooja Swaroop, CIT DR
Hearing: 08.12.2025

सुनवाईक�तारीख/ Date of hearing: 08.12.2025 08.12.2025 उ�ोषणाक�तारीख/Pronouncement on आदेश /O R D E R PER SANJAY AWASTHI, ACCOUNTANT MEMBER:

1.

This appeal arises from order u/s 263 of the Income Tax Act, 1961 (hereinafter “the Act”), passed by Ld. PCIT, Delhi-7, dated 01/03/2024 for AY 2018-19. Through this order the Ld. PCIT has directed the Ld. AO to enhance the taxable income of the assessee by making a disallowance of Rs.42,24,677/-, being the excess remuneration for directors. It is seen that this order has been passed in an ex parte manner considering that the two opportunities provided to the assessee could not be availed of.

1.1 Aggrieved with this action the assessee has approached the ITAT with the grounds of appeal which challenge this action of the Ld. PCIT. In fact, the first ground itself challenges the impugned action on the ground of denial of opportunity.

2. Before us the Ld. AR pointed out that the impugned order was passed in an ex parte manner and thus, only after two opportunities the Ld. PCIT is seen to have disposed of the matter under consideration. The Ld. AR prayed for another opportunity to present the facts before the Ld. PCIT.

2.1 The Ld. DR fairly agreed that since this order was passed in an ex parte manner there would be no objection in case this matter was to be remanded back to the file of the Ld. PCIT.

3.

We have carefully considered the documents before us and have heard the Ld. AR/DR. It is clearly visible that the Ld. PCIT gave two opportunities and thereafter passed the impugned order. Considering the totality of facts and circumstances, we find merit in the submission of Ld. AR that another opportunity should be given to the assessee for making a presentation of facts before the Ld. PCIT. 2 Accordingly, we deem it fit to set aside the impugned order and remand this matter back to the file of Ld. PCIT for fresh adjudication. The assessee would be expected to be alert to the notices issued from his office for hearing in the matter.

4.

In the result, the appeal is allowed for statistical purposes.

Order pronounced in the open court on 08.12.2025

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