Latest Updates on Income Tax, GST & Corporate Law: 8 February 2025
Income Tax
Update-1: The Union Cabinet on Friday approved a new Income Tax Bill aimed at simplifying the tax system without introducing new taxes.
The Union Cabinet on Friday approved the new Income Tax Bill. The bill, which will replace the Income Tax Act, 1961, aims to simplify and modernize India’s tax system. It will also simplify legal language so that taxpayers can easily understand the provisions. The bill may introduce lower penalties for certain offences, making the tax system more taxpayer-friendly. The new tax system will take effect from the financial year 2025-26.
Update-2: New Income Tax Bill May Eliminate Need For Budget For Tax Reliefs
The new income tax bill 2025, which is likely to receive the Union Cabinet’s approval on Friday, is likely to have a unique feature that will eliminate the need to wait for the budget for some kind of income tax reliefs or amend the Income Tax Act. Some provisions have been proposed that will allow the government to modify the limits or amounts of deductions/rebates through executive orders only. Changes to the standard deduction could be among these provisions.
Goods & Services Tax (GST)
Update-1: CBIC Instruction No02/2025-GST (Procedure to be followed in department appeal filed against interest and/or penalty only, related to Section 128A)
In response to seeking of clarification by different field formations, it is hereby clarified by CBIC that, cases where the tax due has already been paid and the notice or demand orders under Section73 only pertains to interest and/or penalty involved, the same shall be considered for availing the benefit ofsection128A. On the similar pattern, it is felt that just because the department has gone in appeal or is in the process of filing an appeal, a taxpayer who is otherwise eligible for availing the benefit of section 128A, should not be denied the benefits.
Update-2: Three held in Odisha for Rs 16.96 crore GST fraud
The Directorate General of GST Intelligence (DGGI) of the Bhubaneswar Zonal Unit has arrested 3 persons for their alleged involvement in issuing fake invoices and fraudulently passing on Input Tax Credit (ITC) amounting to Rs 16.96 crore without actual supply of goods. The prime accused was operating as the partner and proprietor of two firms and issued many fraudulent invoices to various contractors. The second accused, who worked as an accountant in the said firms, was responsible for handling financial records, generating fake sales invoices, e-way bills, and other documents under the owner’s instructions. The third accused, a sales executive, acted as the point of contact between the firms and contractors.
Corporate Law
Update-1: Interim reliefs are crucial to ensure the enforcement of an arbitral award
Interim reliefs are crucial to ensure the enforcement of an arbitral award, as the opposing party may no longer possess sufficient assets post-award, rendering enforcement ineffective. Section 9 of the Arbitration and Conciliation Act, 1996, which allows a party to seek interim relief from a civil court, does not prescribe specific conditions for claiming such relief, thereby granting widespread discretion to courts to order interim protections as may appear “just and convenient”.
Update-2: Insolvency Application maintainable against Personal Guarantor u/s 60(1) in absence of CIRP against the CD
The NCLAT Delhi, in case of Anita Goyal Vs Vistra ITCL (India) Ltd. & Anr held that, even in cases where the National Company Law Tribunal (NCLT) had not yet started or was in the process of liquidating a corporate debtor, an application under section 95 of the Insolvency and Bankruptcy Code (Code) against the personal guarantor might be maintained before the NCLT under section 60(1) of the code. The view that NCLT had no jurisdiction to entertain Section 95 Application filed by the Financial Creditor and the Application ought to have been filed before the DRT was not valid.
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