Executive Summary
Income Tax
- CBDT nudges taxpayers against the Claims of bogus Deductions through Data-Driven Approach – Fake Donations Claims to Political Parties and Trusts under Tax Scanner
Goods And Service Tax (GST)
- Order No. 315/2025, F. No. GSTAT/ Pr. Bench/ Portal/ 125/25-26/2367-70, dated 16 December 2025
- Notification No. G.S.R. 918(E) – New Delhi, the 24th December 2025, [F. No. A-11/1/2024-CESTAT-DOR-Part (1) (Vikash Kumar, Dy. Secy)
Companies Act 2013/ Other Laws
- Small Company Definition Revised (Effective 1 Dec 2025)
- Extension of Filing Deadlines — MCA General Circular No. 08/2025
- SEBI simplified and standardised the procedure for issuance of duplicate share certificates
- RBI Revises FEMA Rules on Export–Import of Currency (3 December 2025)
- Introduction of Modification Utility & Fee for Delayed Filing of CIRP Forms
A. CBDT NUDGEs TAXPAYERS AGAINST THE CLAIMS OF BOGUS DEDUCTIONS THROUGH DATA-DRIVEN APPROACH – FAKE DONATIONS CLAIMS TO POLITICAL PARTIES AND TRUSTS UNDER TAX SCANNER [13-12-2025]
- Recently, the Central Board of Direct Taxes (CBDT) has acted upon many intermediaries who were involved in filing income tax returns with bogus claims of deductions and exemptions under the Income-tax Act. The exercise revealed that some intermediaries have established network of their agents all over India for filing returns with incorrect claims on commission basis. It was observed that huge amount of bogus claims have been made on account of donation to Registered Unrecognized Political Parties (RUPPs) or Charitable Institutions and reduced their tax obligations and have also claimed bogus refunds. Evidence gathered from enforcement actions indicated that RUPPs many of which were non-filers, non-operational at their registered addresses, and are not engaged in any political activity were being used as conduits for routing funds, hawala transactions, cross border remittances and issuing bogus receipts for donations. CBDT carried out follow up searches against some of these RUPPs and Trusts and gathered incriminating evidence in respect of bogus donations by individuals and bogus CSR by companies.
- CBDT has strengthened its data-driven approach to early detection of suspicious claims and identification of high-risk behavior patterns, one such risk pattern has been identified for taxpayers who have made claims under section 80GGC or 80G of the Income-tax Act, 1961. The data analytics indicated that many taxpayers are suspected to be indulged in claiming deductions for donations made to suspicious entities or have not provided relevant information to ascertain genuineness of entities. A large number of taxpayers have already revised their Income-tax Returns for current AY that is 2025-26 and have filed updated ITRs for past years.
- A targeted NUDGE campaign has been launched as a taxpayer friendly measure, providing them opportunity to update their ITRs and withdraw wrong claims if any. SMSs and Email advisories are being issued from 12th December 2025 to such taxpayers on their registered mobile numbers and emails.
A. ORDER NO. 315/2025, F. NO. GSTAT/ PR. BENCH/ PORTAL/ 125/25-26/2367-70, DATED 16 DECEMBER 2025
- This is to inform you that the Goods and Services Tax Appellate Tribunal (GSTAT) has revoked its earlier order dated 24 September 2025, which mandated staggered filing of appeals under Section 112 of the CGST Act, 2017.
- Vide Order No. 315/2025 dated 16 December 2025, the President of GSTAT has dispensed with the staggered filing protocol after reviewing the current capabilities of the GST appeal portal. Accordingly, appeals under Section 112 can now be filed without any staggered restrictions with effect from 18 December 2025.
- It is clarified that appeals already filed pursuant to the earlier order before 18 December 2025 shall remain valid. The revocation is without prejudice to the statutory powers of the Appellate Tribunal under Section 112 of the CGST Act, 2017
B. NOTIFICATION NO. G.S.R. 918(E) – NEW DELHI, THE 24TH DECEMBER 2025, [F. NO. A-11/1/2024-CESTAT-DOR-PART (1) (VIKASH KUMAR, DY. SECY)
- Notification Issued: Ministry of Finance vide S.R. 918(E) dated 24 December 2025
- Rules Amended: GSTAT (Recruitment, Salary and other Terms and Conditions of Service of Group “C” Employees) Rules, 2024
- Stenographer Grade II: Minimum qualification reduced to 12th pass or equivalent
- Upper Division Clerk (UDC): Deputation provision omitted
- Effective Date: From the date of publication in the Official Gazette
A. SMALL COMPANY DEFINITION REVISED (EFFECTIVE DECEMBER 1, 2025)
The Ministry of Corporate Affairs (MCA) issued the Companies (Specification of Definition Details) Amendment Rules 2025 (G.S.R. 880(E)) which came into effect on 1 December 2025. The financial thresholds for classifying a small company under Section 2(85) of the Companies Act, 2013 were significantly increased:
- Paid-up capital limit: ₹10 crore (up from previous lower limit)
- Turnover limit: ₹100 crore (up from previous lower limit)
This expands the pool of companies eligible for simplified compliance, reduced reporting burdens, and lower penalties where applicable.
B. EXTENSION OF FILING DEADLINES-MCA GENERAL CIRCULAR NO. 08/2025
- The Ministry of Corporate Affairs (MCA) has issued General Circular No. 08/2025 dated 30 December 2025, which provides the following relief for companies:
- Companies may now file Annual Returns and Financial Statements for the Financial Year 2024–25 up to 31 January 2026 without payment of any additional (late) fees. The extension applies to key MCA statutory filings, including MGT-7 / MGT-7A, AOC-4 / AOC-4 CFS / AOC-4 NBFC (Ind AS) / AOC-4 CFS NBFC (Ind AS) / AOC-4 (XBRL)
- This relief is issued in continuation of General Circular No. 06/2025 dated 17 October 2025, which initially extended deadlines to 31 December 2025 without additional fees.
- The circular does not extend the statutory deadlines for holding Annual General Meetings (AGMs) under the Companies Act, 2013 — companies must still comply with those timelines.
A. SEBI SIMPLIFIED AND STANDARDISED THE PROCEDURE FOR ISSUANCE OF DUPLICATE SHARE CERTIFICATES
SEBI, vide Circular No. HO/38/13/11(3)2025-MIRSD-POD/I/1102/2025, has simplified and standardised the procedure for issuance of duplicate share certificates. The circular prescribes uniform formats and rationalised documentation requirements to reduce procedural delays and compliance burden. The objective is to improve ease of doing investment, enhance investor convenience, and ensure consistency in practices followed by listed companies and RTAs. On 21 November 2025, the government officially notified enforcement of all four labour codes nationwide.
A. RBI REVISES FEMA RULES ON EXPORT–IMPORT OF CURRENCY (3 DECEMBER 2025)
RBI amended the Foreign Exchange Management (Export and Import of Currency) Regulations, 2015, with effect from 28 November 2025, to revise norms relating to export and import of Indian currency. The amendments primarily streamline rules governing cross-border movement of Indian currency with neighbouring countries such as Nepal and Bhutan, with the objective of simplifying procedures and ensuring better compliance with FEMA.On 24 November 2025, Reserve Bank of India (RBI) issued a circular amending the “Compounding of Contraventions under Foreign Exchange Management Act, 1999 (FEMA)” directions.
A. INTRODUCTION OF MODIFICATION UTILITY & FEE FOR DELAYED FILING OF CIRP FORMS
On 18 December 2025, IBBI issued a circular implementing a Modification Utility on its portal and starting the levy of fees for delayed filing of forms required under Regulation 40B of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. This means that insolvency professionals will be charged a fee (e.g., ₹500 per form per month of delay) for any forms submitted after their due date, including corrections or updates.
The new regime balances the earlier concession period with ongoing compliance discipline and introduces tools for easier correction of filing errors.
Disclaimer Information in this note is intended to provide only a general update of the subjects covered. It is not intended to be a substitute for detailed research or the exercise of professional judgment. KNM accepts no responsibility for loss arising from any action taken or not taken by anyone using this publication. Updates for the period 31.12.2025
