ACIT,CIRCLE-7(1),DELHI, DELHI vs. FIRST GLOBAL SERVICES PRIVATE LIMITED, DELHI

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ITA 9129/DEL/2025Status: DisposedITAT Delhi10 July 2026AY 2023-244 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal found that the CIT(A) had passed a speaking order considering various judicial pronouncements. Therefore, the Tribunal decided not to disturb the CIT(A)'s findings.

What were the facts?

The Assessing Officer disallowed GST payable of Rs. 14,53,09,773/- and made other additions. The assessee appealed this disallowance. The CIT(A) allowed the assessee's appeal.

What were the issues?

Whether GST payable should be routed through the Profit & Loss Account and if Section 43B is applicable to such liabilities.

Which sections of the Income-tax Act were involved?

Section 145A,Section 43B,Section 37(1),Section 80JJAA

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: ‘B’ NEW DELHI

Before: MS. MADHUMITA ROY & SH. KRINWANT SAHAY

For Respondent: DR Assessee by :
Hearing: 02.07.2026Pronounced: 10.07.2026

1 ITA No.9129/Del/2025 ACIT VS. First Global Services (P) Ltd. IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: ‘B’ NEW DELHI BEFORE MS. MADHUMITA ROY, JUDICIAL MEMBER AND SH. KRINWANT SAHAY, ACCOUNTANT MEMBER

I.T.A. No.9129/DEL/2025 (A.Y 2023-24) ACIT First Global Services Private Circle – 7 (1) Vs. Limited Plot No.5-E, First Floor, Delhi Shahpur Jat, New Delhi PAN No.AABCO3273F (Respondent) (APPELLANT)

Department by: Sh. Om Prakash, CIT DR Assessee by : None

Date of Hearing 02.07.2026 Date of Pronouncement 10.07.2026

ORDER PER KRINWANT SAHAY AM Appeal in this case has been filed by the revenue against the order dated 03.10.2026 passed by the Ld. CIT(A)/NFAC, Delhi for the A.Y. 2023-24. Grounds of appeal are as under :-

1.

Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in allowing the appeal of the assessee

2 ITA No.9129/Del/2025 ACIT VS. First Global Services (P) Ltd. by deleting the addition made by the AD amounting to Rs. 14,53,09,773/- on account of GST Payable.

2.

Whether on the facts and circumstances of the case and in law, the Ld.CIT(A) has erred in holding that GST/service tax collected by the assessee need not be routed Trough the Profit & Loss Account, ignoring the mandatory provisions of section 145A of the Act.

3.

Whether on the facts and circumstances of the case and in law, the Ld.CIT(A) has erred in holding that the provisions of section 43B of the Act are not applicable in the present case, without appreciating that once statutory tax liabilities are required to be routed through the Profit & Loss Account as per section 145A of the Act, the provisions of section 43B of the Act automatically come into operation.

2.

Brief facts of the case are that the assessee is a manpower service company. Return of income was filed on 31.10.2023 returning total income of Rs.1,92,70,940 after claiming the entire business income of Rs. 37,50,48,809 as deduction under section 80JJAA. While completing assessment, the AO made the following additions/disallowances: (1) The GST payable amounting to Rs.14,53,09,773 was disallowed u/s 43B. (2) Provision made for the interest payable on statutory dues (Rs. 10 crores) was disallowed. (3) Penalties paid amounting to Rs. 12,77,249 was disallowed u/s 37(1). Total income was assessed at Rs.26,58,57,962.

3 ITA No.9129/Del/2025 ACIT VS. First Global Services (P) Ltd. 3. At the very outset the Ld. DR submitted before the Bench that the only issue involved in this case is the allowance of assessee’s appeal by the Ld. CIT(A) on the ground that GST payable does not get reflected in the P & L account of the assessee, therefore, it is not to be considered for calculating the income of the assessee and accordingly he requested the Bench to quash the order of the Ld. CIT(A) on this issue.

4.

Per contra the Ld. Counsel for the assessee in his written submissions submitted that the issue has been dealt with by various co-ordinate benches of ITAT such as case laws discussed by the Ld. CIT(A) in his order is as under :-

(a) In DCIT. vs. ATS Real Estate Builders P. Ltd. ITA No.1207/DEL/2024 (A.Y.2020- 21 (b) CIT Vs. vs Noble And Hewitt (I) (P) Ltd. (c) Munjal Auto Industries Ltd Vs DCIT (ITAT Ahmedabad). I.T.A. No. 878/Ahd/2024 (Α.Υ.2018-19), (d) DCIT vs. Real Image Media Technologies Pvt. Ltd. [(2012) 23 taxmann.com 258 (Chennai-Trib.)], (e) Maruti Suzuki India Ltd. vs. DCIT [(2011) 136 TTJ 194 (Del)]

5.

Considering all the legal positions and various orders /pronouncements by different coordinate Benches of the Tribunal.

4 ITA No.9129/Del/2025 ACIT VS. First Global Services (P) Ltd. The Ld. CIT(A) has correctly and appropriately given his findings on this issue.

6.

We have considered the findings given by the AO and the assessment order and the Ld. CIT(A) in the appellate order and we find that the Ld. CIT(A) has written a speaking order on this issue keeping in view different judicial pronouncements given by the coordinate Benches of the Tribunal. Accordingly, in our considered view there is no need to disturb the finding given by the Ld. CIT(A) on this issue. Thus, Revenue’s appeal is dismissed. Order pronounced in open Court on 10 July, 2026.

.

Sd/- Sd/- (MADHUMITA ROY) (KRINWANT SAHAY) JUDICIAL MEMBER ACCOUNTANT MEMBR Dated : 10/07/2026 *Neha Sr. PS* Copy forwarded to : 1. Appellant 2. Respondent 3. CIT 4. CIT (Appeals) 5. DR: ITAT

ASSISTANT REGISTRAR ITAT NEW DELHI

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