Recent Updates on Income Tax, GST & Corporate Law: 31 January 2025
Income Tax
Update-1: New SMS campaign by the Income Tax Department to warn taxpayers about political donations claim
The Income Tax Department has issued a cautionary message to all taxpayers, including salaried individuals, urging them to verify their Section 80GGC claims for donations made to political parties. If any discrepancies are found, taxpayers are advised to file an Updated Income Tax Return (ITR-U) on or before March 31, 2025, for Assessment Year (AY) 2022-23 (Financial Year 2021-22).
Similar notifications are also being sent for AY 2023-24, instructing taxpayers to revise their returns by the same deadline. Experts suggest that this message primarily serves as a warning for individuals who may have falsely claimed deductions under Section 80GGC. However, those who have genuinely contributed to a political party and correctly claimed the deduction need not be concerned.
Update-2: Income Tax Dept. IT Systems Declared Protected Under Information Technology Act
The Ministry of Finance has designated specific computer resources of the Directorate of Income Tax (Systems) under the Central Board of Direct Taxes as protected systems under Section 70 of the Information Technology Act, 2000. The protected systems include the TRACES web portal, e-filing infrastructure, the Income Tax Business Application (ITBA), and Project Insight databases, all critical for tax processing, compliance, and data management.
Goods & Services Tax (GST)
Update-1: Circular No. 246/03/2025-GST- Clarification on applicability of late fee for delay in furnishing of FORM GSTR-9C
The Board has received representations requesting clarification on the applicability of late fees for delays in submitting the reconciliation statement in FORM GSTR-9C. Specifically, concerns have been raised regarding whether late fees under Section 47 of the Central Goods and Services Tax Act, 2017 (CGST Act) would apply when a registered person fails to furnish FORM GSTR-9C along with the annual return in FORM GSTR-9 but submits it later, beyond the prescribed due date.
To ensure consistency in the interpretation and implementation of legal provisions across various field formations, the Board, exercising its authority under sub-section (1) of Section 168 of the CGST Act, issues this circular to provide the necessary clarification.
Update-2: Clarification on Regularizing payment of GST on skilling services provided by Training Partners approved by the National Skill Development Corporation.
The exemption previously available to skilling services provided by Training Partners approved by the National Skill Development Corporation (NSDC) was withdrawn following the recommendations of the 54th GST Council meeting. However, the government later recognized that this decision could have a significant negative impact on the skilling ecosystem.
To address this concern, the 55th GST Council meeting recommended reinstating the exemption, which has now been restored through Notification No. 06/2025-CT (Rate) dated 16.01.2025, effective from 16.01.2025. Additionally, it has been clarified that GST payments for services rendered by NSDC-approved Training Partners during the interim period from 10.10.2024 to 15.01.2025 shall be regularized on an “as is where is” basis, as per the GST Council’s recommendation.
Corporate Law
Update-1: Financial Creditor’s can Invoke Pledge; IBC Application can e Admitted Despite Settlement Attempts: NCLAT
The National Company Law Appellate Tribunal (NCLAT) recently dismissed an appeal filed by Amit Yogesh Satwara, the suspended director of a corporate debtor (CD), challenging the order of the National Company Law Tribunal (NCLT), Mumbai, which admitted a Section 7 application filed by the Financial Creditor, Incred Financial Services Limited. The case revolves around a loan of Rs. 5 crores sanctioned in 2020, which the Corporate Debtor failed to repay, leading to the initiation of Corporate Insolvency Resolution Process (CIRP). Despite attempts at settlement, the NCLAT upheld the NCLT’s decision, finding no reason to interfere with the order.
Update-2: NFRA Penalizes Statutory Auditor of Religare Finvest for Misconduct
National Financial Reporting Authority (NFRA) issued Order No. 01/2025 dated January 30, 2025, addressing the findings against CA Neeraj Bansal, a member of the Institute of Chartered Accountants of India (ICAI). The order stemmed from an investigation into his role as the Engagement Partner (EP) for the statutory audit of Religare Finvest Limited (RFL) for the financial year 2017-18. The investigation, initiated under Section 132(4) of the Companies Act, 2013, revealed several lapses in compliance with auditing standards and legal requirements.
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