Latest Updates on Income Tax, GST & Corporate Law: 7 February 2025
Income Tax
Update-1: Cabinet may approve new Income Tax Bill on Friday i.e. 7th Feb
The Union Cabinet may approve the new Income Tax Bill on Friday, paving the way for its introduction in the Lok Sabha as early as Monday, sources said. The bill is part of a broader push to reform the taxation system. The government has already made it clear that the bill will not introduce any new taxes and just focus on simplifying tax laws, removing ambiguities, and ensuring ease of compliance for taxpayers. In addition, several amendments are expected to be introduced to the existing law, with a focus on reducing litigation. One of the provisions could include a reduction in penalties for certain offences, making the tax framework less punitive and more taxpayer-friendly.
Update-2: Alert- Cash transfers to wife may attract IT notice
Whenever you send money to your wife every month under UPI or cash for household expenditure, you should be aware of certain income tax rules which may lead to sending you a notice for tax. Generally, money provided by a husband to his wife is not taxed.
However, if your wife invests the amount received in Fixed Deposits (FDs), property, or the stock market, income from such investments could be included in your tax return. Moreover, Section 269SS and 269T of the Income Tax Act states that transactions in cash exceeding an amount will be treated as forming part of taxable income. So, whenever you are sending any money to your wife, you should be aware of these income tax rules.
Update-3: CBI probes Income Tax officials for ’sabotaging’ Faceless Assessment Scheme
The CBI has filed a case against nine individuals, including one Deputy Commissioner of Income Tax (IRS), two Income Tax Inspectors, five Chartered Accountants (CAs), and one private individual, for allegedly attempting to sabotage the government’s “Faceless Scheme of Assessment.” Under this scheme, taxpayers are not meant to know the identity of the assessment or appellate officers handling their cases. However, CBI alleges that a group of CAs, in collusion with certain income tax officials, were illicitly revealing the names of these officers to taxpayers.
Goods & Services Tax (GST)
Update-1: Advisory on e-Way Bill Generation for Goods under Chapter 71
Goods covered under Chapter 71 viz., Natural or cultured pearls and precious or semi-precious stones; precious metals and metals clad with precious metal, Jewellery, goldsmiths’, and silversmiths’ articles, except those under HSN 7117(Imitation Jewellery), are exempt from the mandatory requirement of generating E-Way Bill. It has been observed that various industry stakeholders have been generating EWBs for goods under Chapter 71. In this regard, it is clarified by this advisory that, while the system previously allowed EWB generation for goods under Chapter 71, this facility has now been withdrawn.
Accordingly, taxpayers and transporters engaged in the movement of goods under Chapter 71 (except HSN 7117) are advised that EWB generation is not required, except for the intrastate movement of such goods in Kerala, which was mandated vide Notification No.10/24-State Tax dated 27/12/24 issued by Kerala.
Update-2: Centre Rethinks on GST Waiver for Insurance
The Centre may push back against a proposal to give GST exemption for certain insurance policies, as it reckons that this would raise the cost of insurers, leading to a firming up of premium amounts. However, it will strongly pitch for a major reduction in the GST rates for the insurance sector. This view may be conveyed to the GST Council as it meets next. The Council is likely to consider the report of the group of ministers (GoM), which reviewed taxation of health and life insurance premiums in its next session.
Update-3: CBIC Chairman says no need to review GST on gaming, will take action on offshore betting websites
In an exclusive interview with CNBC Awaaz, Sanjay Agarwal, Chairman of the Central Board of Indirect Taxes and Customs (CBIC), revealed that there is a positive developments in GST revenue from online gaming sector. He stated that online gaming revenue has nearly quadrupled and continues to grow. Despite this surge, there are no immediate plans to reconsider the current 28% GST rate. Online gaming companies have not raised any objections so far.
Corporate Law
Update-1: IBBI moots two-stage approval process to speed up rescue of bankrupt firms
The Insolvency and Bankruptcy Board of India suggests regulatory amendments like a two-stage approval for rescue plans, early takeover by resolution applicants, handling of interconnected entity bankruptcies, and part-sales of stressed firms to speed up insolvency resolutions. The proposals aim to improve efficiency, reduce asset value erosion, and enhance financial sustainability amid extended resolution timelines.
Update-2: Lucknow Consumer Commission dismisses fraudulent insurance claim Against ICICI Lombard
The State Consumer Commission in Lucknow has imposed a ₹10,00,000 penalty on a complainant for a fraudulent insurance claim against ICICI Lombard. The case a Mercedes-Benz’s alleged theft, and investigations revealed gross negligence and discrepancies. The court recommended a Crime Branch investigation and emphasized stricter action against insurance fraud. The court observed a pattern of alleged fraudulent behavior, where vehicles were insured at inflated values and subsequently reported as stolen or damaged.
Also Read: Kerala High Court: Interest & Penalty on ITC Availment under Wrong Head Not Maintainable
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