Author: inavatiq

Circular No. HO/(83)2025-IMD-POD-1/I/2027/2026, Dated 07.01.2026

1. Introduction

The Securities and Exchange Board of India (SEBI) has extended the timeline for implementation of the additional incentive structure for distributors aimed at onboarding new investors, vide Circular No. HO/(83)2025-IMD-POD-1/I/2027/2026 dated 07-01-2026.

2. Background of the Incentive Framework

The incentive framework was introduced to encourage distributors to onboard new individual investors from B-30 cities and new women investors from both T-30 and B-30 cities, thereby promoting wider participation and inclusivity in the securities market.

3. Revised Implementation Timeline

The framework, which was earlier scheduled to come into effect from 01-02-2026, will now be applicable from 01-03-2026. The extension has been granted in response to operational difficulties highlighted by industry participants.

4. Scope and Applicability

The extended timeline applies only to the implementation date of the additional incentive structure. All other provisions, conditions, and operational guidelines prescribed under the earlier SEBI circular shall continue to remain unchanged.

5. Conclusion

By extending the implementation timeline, SEBI has provided additional time to distributors to align their systems and processes with the new incentive framework. The move is expected to facilitate smoother adoption while continuing to support SEBI’s objective of expanding investor outreach and participation.

Click Here To Read The Full Circular 

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Circular No. IRDAI/PP&GR/CIR/MISC/02/01/2026, Dated 06.01.2026

1. Introduction

The Insurance Regulatory and Development Authority of India (IRDAI) has issued a circular dated 06-01-2026 directing insurers and insurance intermediaries to adopt the 1600-series numbering for all service and transactional voice calls.

2. Regulatory Background

The directive is in furtherance of the mandate issued by the Telecom Regulatory Authority of India (TRAI) to standardise numbering for service-related calls. The move seeks to distinguish legitimate service calls from unsolicited commercial communication.

3. Scope of the Direction

The requirement applies to all insurers and insurance intermediaries making service and transactional voice calls to policyholders or prospects. Once implemented, such calls must be made exclusively using the designated 1600-series numbers.

4. Timeline for Implementation

IRDAI has mandated that entities complete the adoption of the 1600-series numbering on or before 15 February 2026. After this date, no service or transactional calls are permitted to be made from any other number series.

5. Conclusion

By mandating the use of 1600-series numbers, IRDAI aims to curb impersonation-based fraud, reduce unsolicited communications, and enhance consumer trust in insurance-related interactions. Insurers and intermediaries are required to ensure timely compliance with the directive.

Click Here To Read The Full Circular 

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Global Financial Insights is a weekly feature for the Accounts and Audit Module subscribers of Taxmann.com. It provides you with the latest updates on financial reporting and auditing practices from across the globe. Here is this week’s financial update:-

1. IAASB issues narrow scope amendments in IAASB standards considering ethical requirements for using the work of external experts

The International Auditing and Assurance Standards Board (IAASB) after considering the recently approved revisions to the International Code of Ethics for Professional Accountants issued amendments to IAASB standards. The introduction of explicit ethical requirements for using the work of external experts in audit, assurance, and non-assurance engagements have led to the amendments in following IAASB standards:

(a) ISA 620, Using the Work of an Auditor’s Expert
(b) ISRE 2400, Engagements to Review Historical Financial Statements
(c) ISAE 3000, Assurance Engagements Other than Audits or Reviews of Historical Financial Information
(d) ISRS 4400, Agreed-upon Procedures Engagements.

Source – International Auditing and Assurance Standards Board

2. IAASB issues approach for updating International Standard of Auditing for audits of Less Complex Entities

The International Auditing and Assurance Standards Board (IAASB) has outlined a formal approach for maintaining and updating the International Standard on Auditing for Audits of Financial Statements of Less Complex Entities (ISA for LCE). Through an approach statement, the IAASB aims to ensure transparency, consistency and clarity in how the standard is revised over time. The approach emphasises that any updates to the ISA for LCE will remain relevant to the nature and circumstances of audits of less complex entities, while also staying proportionately aligned with the core principles and requirements of the full International Standards on Auditing.

The approach statement further explains the overall context, purpose and process for maintaining the ISA for LCE, including roles, responsibilities, outputs and timelines. It also sets out how the IAASB will respond to new or revised auditing standards by assessing their relevance and determining proportionate changes to the ISA for LCE, thereby supporting high-quality, scalable audits for smaller and less complex entities.

Source – International Auditing and Assurance Standard Board

Click Here To Read The Full Story 

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Case Details: Zydus Hospira Oncology (P.) Ltd., In re [2025] 181 taxmann.com 643 (AAR - GUJARAT)

Judiciary and Counsel Details

• Sushma Vora & Vishal Malani, Member
• Hiren Pathak, Authorised Signatory for the Applicant.

Facts of the Case

The applicant sought clarification regarding the applicability of GST on recoveries of employees’ share of canteen charges. It was submitted that it was an SEZ pharmaceutical unit mandated under the Factories Act, 1948 to provide a canteen facility for its employees. It recovered a fixed portion of the meal cost from employees through salary deductions, while the remaining cost was borne by the applicant as part of staff welfare. It was contended that such recoveries were employee perquisites and did not constitute a supply under GST. The matter was accordingly placed before the Authority for Advance Ruling (AAR).

AAR Held

The AAR held that the applicant’s recovery of employees’ share of canteen charges did not constitute an outward supply under Section 7 of the CGST Act and the Gujarat GST Act. It was observed that the collection of the employees’ portion and its subsequent remittance to the canteen service provider were merely internal adjustments related to employee perquisites and were not made in the course or furtherance of the business. Applying the guidance of the CBIC Circular, it concluded that recoveries of this nature fall outside the definition of supply under Schedule III. Consequently, GST was not leviable on the employees’ share of canteen charges.

List of Cases Referred to

• Amneal Pharmaceuticals (P.) Ltd., In re [2021] 126 taxmann.com 228/[2022] 58 GSTL 382 (AAAR-GUJARAT) (para 13)
• Zentiva (P.) Ltd., In re [2024] 163 taxmann.com 276 (AAR – GUJARAT) (para 13)
• Zydus Lifesciences Ltd., In re [2022] 143 taxmann.com 346 (AAR – GUJARAT) (para 13)
• Cinemax India Ltd. v. UOI [2011] 12 taxmann.com 492/32 STT 359 (Gujarat) (para 15)
• Tata Power Company Ltd., In re [2022] 134 taxmann.com 69/89 GST 655/57 GSTL 141 (AAR – MAHARASHTRA) (para 16)
• Tata Motors Ltd., In re [2020] 119 taxmann.com 106/82 GST 685/41 GSTL 35 (AAR – MAHARASHTRA) (para 16)
• Posco India Pune Processing Center (P.) Ltd., In re [2019] 102 taxmann.com 21/21 GSTL 351 (AAR – MAHARASHTRA) (para 16)
• Jotun India (P.) Ltd., In re [2019] 110 taxmann.com 184/76 GST 691/29 GSTL 778 (AAR – MAHARASHTRA) (para 16)
• MMR Khan v. UOI 1990 AIR 937 (para 17)
• Troikaa Pharmaceuticals Ltd., In re [2023] 146 taxmann.com 128 (AAR – GUJARAT) (para 21)
• CCE, Nagpur v. Ultratech Cement Ltd. [2010] 20 STR 577/29 STT 244 (Bombay) (para 27).

The post SEZ Canteen Charge Recovery Not Taxable Under GST | AAR appeared first on Taxmann Blog.

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Notification No. SEBI/LAD-NRO/GN/2026/291, Dated 07.01.2026

1. Introduction

The Sec1.urities and Exchange Board of India (SEBI) has notified the SEBI (Stock Brokers) Regulations, 2026 vide Notification No. SEBI/LAD-NRO/GN/2026/291 dated 07-01-2026, replacing the earlier SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992.

2. Objective and Scope of the Regulations

The 2026 Regulations introduce a comprehensive and updated regulatory framework governing the registration and functioning of stock brokers and clearing members. The new regime aims to strengthen market integrity, enhance investor protection, and align regulatory oversight with the evolving structure of the securities market.

3. Registration and Operational Framework

The Regulations prescribe eligibility criteria, registration requirements, and detailed operational, general, and enhanced obligations for trading members and clearing members. They also include provisions relating to risk management, inspection, fees, deposits, and prevention of fraud and market abuse.

4. Net Worth and Financial Requirements

SEBI has mandated minimum net worth thresholds based on the category of membership. Trading members are required to maintain a minimum net worth of ₹1 crore, self-clearing members ₹5 crore, clearing members ₹15 crore, and professional clearing members ₹50 crore, subject to applicable variable net worth requirements and specified relaxations.

5. Conclusion

By notifying the SEBI (Stock Brokers) Regulations, 2026, SEBI has overhauled the regulatory framework governing stock brokers, replacing a three-decade-old regime. The revised regulations are expected to improve compliance standards, reinforce investor confidence, and promote a more robust and transparent securities market ecosystem.

Click Here To Read The Full Notification 

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PR no. 2025-2026/1866; dated: 06.01.2026

1. Introduction

The Reserve Bank of India (RBI) has issued draft directions proposing a cap on dividend payouts by banks, limiting distributions to a maximum of 75% of net profit. The proposal was released vide Press Release No. 2025-2026/1866 dated 06-01-2026.

2. Proposed Dividend Framework

Under the draft directions, RBI has proposed a revised methodology for computing the maximum eligible dividend payout. The term “dividend” has been defined to include interim dividends payable on equity shares, while expressly excluding dividends on Perpetual Non-Cumulative Preference Shares.

3. Concept of Adjusted Profit After Tax

The RBI has introduced the concept of “Adjusted Profit After Tax (PAT)”, which shall be calculated as the PAT of the relevant financial year minus Net NPAs as on March 31 of that year. The proposed 75% cap on dividend payouts will be applied on this adjusted PAT figure.

4. Reporting and Compliance Requirements

Banks declaring dividends or remitting profits to their Head Office will be required to submit a report in the prescribed format to the Department of Supervision of the RBI. This report must be furnished within a fortnight from the date of dividend declaration or profit remittance.

5. Conclusion

The proposed cap on dividend payouts is aimed at strengthening banks’ capital buffers and promoting long-term financial stability. RBI has also reserved the right to impose restrictions on dividend distribution or profit remittance in cases of non-compliance with applicable laws and regulatory guidelines.

Click Here To Read The Full Press Release 

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GSTN Advisory, Dated 04-01-2026

1. Introduction

The Goods and Services Tax Network (GSTN) has issued an advisory dated 04-01-2026 announcing the introduction of an online facility for filing opt-in declarations for hotel accommodation premises to be recognised as “specified premises” under GST.

2. Eligibility and Scope

The facility is available to taxpayers providing hotel accommodation services, except composition taxpayers, TDS/TCS taxpayers, SEZ units or developers, casual taxpayers, and taxpayers with cancelled registrations. Suspended taxpayers are permitted to opt in, while rejected applications remain ineligible.

3. Opt-In Procedure for FY 2026–27

For FY 2026–27, eligible taxpayers can electronically file Annexure VII on the GST Portal between 01-01-2026 and 31-03-2026 to declare up to 10 premises as specified premises. This declaration enables the application of the relevant GST provisions for such premises.

4. Continuation and Opt-Out Mechanism

Once exercised, the opt-in option continues for subsequent financial years unless the taxpayer files an opt-out declaration in Annexure IX. If no opt-out is filed, the declared premises will continue to be treated as specified premises.

5. Provisions for New Registrations

Applicants for new GST registrations may file Annexure VIII within 15 days of ARN generation to declare specified premises from the effective date of registration. If this window is missed, the opt-in can only be exercised during the annual Annexure VII filing period.

Click Here To Read The Full Update 

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FAQs dated 05.01.2026

1. Introduction

The Securities and Exchange Board of India (SEBI) has issued FAQs dated 05-01-2026 to guide investors on Investor Service Requests processed by Registrars to an Issue and Share Transfer Agents (RTAs).

2. Purpose of the FAQs

The FAQs aim to enhance investor awareness and ensure smooth processing of service requests by providing clarity on procedures, documentation requirements, and applicable regulatory provisions under the SEBI framework.

3. Key Areas Covered

The FAQs cover registration and updation of PAN, KYC, nomination, bank details, and contact information. They also explain the process for dematerialisation and rematerialisation of securities, helping investors understand operational aspects of holding securities.

4. Investor Protection and Grievance Redressal

SEBI has addressed grievance redressal mechanisms, treatment of unclaimed securities, matters relating to the Investor Education and Protection Fund (IEPF), and the process of e-voting, reinforcing transparency and investor protection.

5. Conclusion

By issuing these FAQs, SEBI has provided a comprehensive reference for investors to navigate service requests handled by RTAs. Investors are advised to refer to applicable SEBI laws, regulations, and circulars for detailed compliance and procedural requirements.

Click Here To Read The Full Update 

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Case Details: Sri Shivaganga Yoga Centre vs. Income-tax Officer (Exemption) [2025] 181 taxmann.com 867 (Bangalore - Trib.)

Judiciary and Counsel Details

• Prashant Maharishi, Vice President
• Gowrish, CA for the Appellant.
• Ganesh R. Ghale, Adv.,SC for the Respondent.

Facts of the Case

The assessee, Sri Shivaganga Yoga Centre, a charitable trust running a Yoga Centre and conducting a postgraduate diploma course, filed its return of income for A.Y. 2019-20 claiming exemption under section 10(23C)(iiiad) in respect of course fees collected from students. The Central Processing Centre processed the return under section 143(1).

The CPC denied the exemption on the ground that the assessee had not selected section 10(23C)(iiiad) in the relevant drop-down menu under “section under which exemption claimed” in Schedule – Personal Information and had not filed Schedule IE-4. The assessee explained that the omission occurred due to a technical issue in the return-filing utility and that its aggregate annual receipts did not exceed the monetary limit prescribed under rule 2BC.
A rectification application filed under section 154 was rejected on the ground that the issue was debatable. The Commissioner (Appeals) upheld the denial of exemption. The matter reached before the Tribunal.

High Court Held

The Tribunal observed that if an issue is debatable, it could not have been adjusted while processing the return under section 143(1). It was noted that the denial of exemption was based solely on non-selection of the relevant drop-down option and non-filing of Schedule IE-4, and not on any inconsistency or incorrect claim in the return of income.

The Tribunal held that mere technical or procedural lapses in filling the return could not be the basis for denial of a substantive exemption, particularly when the necessary information was otherwise available on record, and the assessee satisfied the conditions prescribed under section 10(23C)(iiiad).

Accordingly, the Tribunal directed the Assessing Officer to verify the factual eligibility of the assessee and allow the exemption under section 10(23C)(iiiad), or under section 11, if otherwise admissible in accordance with law. The appeal was allowed for statistical purposes.

The post Sec. 10(23C)(iiiad) Exemption Not Denied for Drop-Down Error | ITAT appeared first on Taxmann Blog.

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Case Details: Elgi Sauer Compressors Ltd. vs. State Tax Officer [2026] 182 taxmann.com 72 (Madras)

Judiciary and Counsel Details

• C. Saravanan, J.
• G. Vardini Karthik for the Petitioner.
• Ms. P.Selvi, Govt. Adv. (tax) for the Respondent.

Facts of the Case

The petitioner challenged an impugned order confirming a demand arising from a mismatch between GSTR-2A and GSTR-3B. It was submitted that the extended period of limitation under Section 74 of the CGST Act was incorrectly invoked. It contended that the preceding show cause notice was unclear and was based solely on an audit report. The mismatch arose due to technical glitches as the GST portal was not fully synchronized with the ICEGATE portal, causing difficulties in claiming input tax credit on IGST transactions. The matter was accordingly placed before the High Court.

High Court Held

The High Court held that the impugned order could not be challenged solely on the ground of limitation, as the reply did not engage with the merits of the show cause notice, leaving the jurisdictional officer under CGST with no alternative but to confirm the demand. It was held that the matter should be sent back to the jurisdictional officer for reconsideration. The impugned order was quashed, and directed that 10% of the disputed tax be deposited from the Electronic Cash Ledger within 30 days, in accordance with Sections 16 and 74 of the CGST Act/Tamil Nadu GST Act.

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