Author: inavatiq

1. Facts

Metro Link Infrastructure Limited, hereinafter referred to as “the Company,” is engaged in the business of development and construction of a metro rail network. The project is fully funded by the Government of India (GoI) through interest-free subordinate debt specifically earmarked for project execution.

During the year, the Company received substantial subordinate debt from the Government to meet capital expenditure requirements of the metro system, which is currently under construction. The Company applies the principles of Ind AS 109, Financial Instruments, for financial reporting purposes. Accordingly, the subordinate debt is measured at fair value on initial recognition, and the difference between the amount received and the fair value is treated as a government grant. Further, for subsequent measurement, the company applies the Effective Interest Rate (EIR) method, resulting in recognition of a notional interest expense over the tenure of the debt.

As per the company’s accounting policy, the borrowing costs that are directly attributable to the construction of a qualifying asset are capitalised in accordance with Ind AS 23, Borrowing Costs. Therefore, the interest expense arising from fair valuation of the subordinate debt determined under the effective interest method has been charged to Capital Work-in-Progress (CWIP), as it relates specifically to the ongoing construction of the metro infrastructure.

Furthermore, the Company has temporarily deployed a portion of the unutilised subordinate debt proceeds in short-term investments. The investments generated interest income, which the Company has recognised in the Statement of Profit and Loss considering it as an incidental income earned during the construction phase.

State whether the accounting treatment for interest on subordinate debt is appropriate. Further, analyse whether the interest income earned from temporary deployment of project specific subordinate debt funds should be adjusted against the cost of the qualifying asset or should continue to be recognised in profit or loss?

2. Relevant Provision

Ind AS 109 – Financial Instruments

Para 4.2.1 of Ind AS 109

An entity shall classify all financial liabilities as subsequently measured at amortised cost, except for:

(a) financial liabilities at fair value through profit or loss.

(b) financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or when the continuing involvement approach applies.

(c) financial guarantee contracts …………….

Amortised cost of a financial asset or financial liability

The amount at which the financial asset or financial liability is measured at initial recognition minus the principal repayments, plus or minus the cumulative amortisation using the effective interest method of any difference between that initial amount and the maturity amount and, for financial assets, adjusted for any loss allowance.

Effective Interest Method

The method that is used in the calculation of the amortised cost of a financial asset or a financial liability and in the allocation and recognition of the interest revenue or interest expense in profit or loss over the relevant period.

Effective Interest Rate

The rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial asset or financial liability to the gross carrying amount of a financial asset or to the amortised cost of a financial liability.

Ind AS 23 – Borrowing Costs

Para 8 of Ind AS 23

An entity shall capitalise borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset. An entity shall recognise other borrowing costs as an expense in the period in which it incurs them.

Para 12 of Ind AS 23

To the extent that an entity borrows funds specifically for the purpose of obtaining a qualifying asset, the entity shall determine the amount of borrowing costs eligible for capitalisation as the actual borrowing costs incurred on that borrowing during the period less any investment income on the temporary investment of those borrowings.

Para 13 of Ind AS 23

The financing arrangements for a qualifying asset may result in an entity obtaining borrowed funds and incurring associated borrowing costs before some or all of the funds are used for expenditures on the qualifying asset. In such circumstances, the funds are often temporarily invested pending their expenditure on the qualifying asset. In determining the amount of borrowing costs eligible for capitalisation during a period, any investment income earned on such funds is deducted from the borrowing costs incurred.

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The post Ind AS 23 | Accounting Treatment for Interest on Project-Specific Loans and Adjustment of Investment Income appeared first on Taxmann Blog.

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Editorial Team – [2025] 180 taxmann.com 862 (Article)

Global IDT Insights provides a weekly snippet of tax news specifically related to Indirect Taxes from around the globe.

1. New Zealand Issues Guidance on Second-hand Goods Input Tax Deduction under GST

New Zealand has issued a fact sheet summarising the requirements for claiming a second-hand goods input tax deduction under GST. The guidance explains the conditions that must be met for a registered person to claim a notional input tax deduction when purchasing second-hand goods. It addresses the eligibility of goods, the nature of the supply, payment obligations, record-keeping requirements, and relevant exceptions.

The fact sheet also provides clarification on definitions, the scope of second-hand goods, and limitations that apply to certain scenarios. It is focused solely on GST considerations and establishes the procedural requirements for claiming a second-hand goods input tax deduction.

Key aspects of this guidance include

(a) Registered person is the only eligible claimant – Only a person registered for GST is entitled to claim a second-hand goods input tax deduction. Registration is a mandatory condition and forms the basis for determining eligibility. In the absence of registration, a person is not permitted to claim the deduction, irrespective of the nature of the goods acquired.

(b) Only qualifying second-hand goods may be claimed – The goods acquired must meet the definition of second-hand goods, meaning they are previously used or previously owned. Goods purchased directly from a producer, whether through a wholesaler, distributor, or retailer, fall outside this definition. The acquisition must also be for the purpose of making taxable supplies. Goods that do not meet these conditions cannot give rise to a deduction for second-hand goods.

(c) Only sales qualify as eligible supplies – The supply of goods must be effected by way of sale to enable the deduction. Supplies made by lease, distributions to or from the estate of a deceased person, and certain trust distributions or resettlements are specifically excluded. A compulsory acquisition may be treated as a sale for this purpose. Only supplies meeting the statutory meaning of sale can support the deduction.

(d) Goods must be in New Zealand and the supply must be non-taxable – At the time of supply, the goods must be located in New Zealand. The supply must not be a taxable supply, covering supplies made by unregistered persons, exempt supplies, supplies not made in the course or furtherance of a taxable activity, or supplies made outside New Zealand. These conditions operate concurrently. If either condition fails, the deduction is not available.

(e) Deduction limited to the extent of payment supported by records – A deduction is permitted only to the extent that payment has been made in the relevant taxable period. The amount paid determines the quantum of the deductible notional input tax. Adequate records must be maintained to substantiate the claim.

(f) Specific exclusions and limitations apply – The deduction is not available for goods acquired before 1 October 1986, previously-leased imported goods, or zero-rated financial services. These categories fall outside the statutory scope of the second-hand goods input tax deduction. The deduction may also be restricted where the supplier and recipient are associated persons. Such limitations must be applied as prescribed.

Source – Fact Sheet

Click Here To Read The Full Article

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Jimit Devani, Sannidhi Shah & Anushree Damle – [2025] 180 taxmann.com 861 (Article)

NITI Ayog, the policy think tank of the government, recently released a working paper that seeks to address issues related to taxation of foreign enterprises, with a framework to project India as a simplified tax regime that has the ability to attract high quality foreign investment – a mainstay of the overall objective to become a developed economy by 2047.

The NITI Aayog’s Consultative Group on Tax Policy’s inaugural working paper ‘Enhancing Certainty, Transparency, and Uniformity in Permanent Establishment and Profit Attribution for Foreign Investors in India’ focuses on two of the most debated areas in international taxation — Permanent Establishment (PE) and profit attribution. NITI Aayog emphasizes the need to simplify and streamline India’s tax framework, especially in light of evolving legal interpretations. Recent Supreme Court rulings, such as Formula One World Championship Ltd. v. CIT and Hyatt International (Southwest Asia) Ltd. vs. ACIT, have expanded the scope of PE and clarified how profits should be attributed to Indian operations. These developments, along with the complexities of attribution and the lingering impact of retrospective taxation back the need for tax reforms. The key proposals in the report are discussed below:

The Game-Changer – Presumptive Taxation

The proposed presumptive taxation scheme is a standout reform. It allows foreign companies to opt for a simplified tax regime based on sector-specific deemed profit margins applied to gross receipts from India. This optional mechanism eliminates the need for PE determination and complex profit attribution, offering a safe harbour for compliant taxpayers.

To simplify compliance, the scheme suggests indicative margins such as:

• 10% for infrastructure, EPC, engineering, and oilfield services
• 5% for offshore supply
• 15% for marketing and distribution support
• 20% for consulting, management, and software services
• 30% for digital and e-commerce platforms

To support its objective of reducing litigation and enhancing certainty, the scheme offers:

• Optional participation with opt-out provisions (with documentation)
• Carve-out from other provisions of Indian Tax Legislations to avoid overlapping taxation
• Multi-year lock-in safeguards to prevent misuse
• Alignment with treaty obligations and potential negotiation with key treaty partners
• Administrative simplicity and reduced compliance burden, thereby promoting predictability.

Click Here To Read The Full Article

The post [Opinion] Roadmap on Tax Transparency | NITI Aayog’s Blueprint for Tax Reform for Foreign Investors appeared first on Taxmann Blog.

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Case Details: Anita Rani vs. Income-tax Officer - [2025] 180 taxmann.com 562 (Punjab & Haryana)

Judiciary and Counsel Details

• Jagmohan Bansal & Amarinder Singh Grewal, JJ.
• Alok Mittal & Ishwinderpal Singh, Advs. for the Petitioner.
• Saurabh Kapoor, Rana Gurtej Singh, Ms Muskaan Gupta, Ms Muskan Chauhan & Tanya Kumar, Advs. for the Respondent.

Facts of the Case

The revenue assessed tax liability against a firm. The liability could not be recovered from said firm. KK, husband of the petitioner, was one of the partners of said firm. Revenue served a notice upon the Bank, informing it that a sum was due from KK, as a legal heir of his father, one of the partners of the firm. There was a credit balance in the account. The attached account was a joint account of KK and the petitioner.

The petitioner filed a writ petition before the High Court, contending that the funds in the bank account constituted rental income. The said income was not related to the firm’s liabilities. There was nothing on record indicating that the petitioner had inherited property from the firm’s partners.

High Court Held

The High Court held that Section 159 imposes liability on legal representatives, and Section 189 deals with the dissolution of the firm. The liability of the legal representative is confined to the value of the estate of the deceased. The liability cannot exceed the assets inherited.

In the instant case, the AO mechanically attached the petitioner’s bank account. There was a meagre amount in the account. The AO could attach the assets of the petitioner, which she had inherited from the partners of the defaulter firm. In the absence of evidence that the petitioner had inherited the defaulter firm’s assets, there was no reason to attach her bank account. Thus, the attachment notice issued by the AO was to be set aside.

The post HC Sets Aside Attachment of Joint Bank Account for Firm’s Tax Dues appeared first on Taxmann Blog.

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Case Details: Bird Delhi General Aviation Services (P.) Ltd. vs. Sales Tax Officer II Avato - [2025] 180 taxmann.com 691 (Delhi)

Judiciary and Counsel Details

• Prathiba M. Singh & Shail Jain, JJ.
• Sparsh Bhargava, Ms Vanshika Taneja & Ms Ishita Farsaiyan, Advs. for the Petitioner.
• Urvi Mohan, Adv. & Kushal Kumar, SPC for the Respondent.

Facts of the Case

The petitioner, filed a writ challenging a show cause notice and the impugned order passed under Section 73 of the CGST Act and Delhi GST Act. It was contended that the impugned order was passed without providing an opportunity to be heard on merits. The petitioner challenged the validity of CBIC Notifications, extending the time limit for issuing orders under Section 73. It was submitted that such notifications were invalid. The matter was placed before the High Court.

High Court Held

The High Court set aside the impugned order on the grounds of lack of proper hearing and remanded the matter for fresh adjudication. The Court directed that the petitioner be given a full and fair opportunity to file a detailed reply to the show cause notice. This fresh hearing is to be conducted with due regard to principles of natural justice, and the petitioner is required to pay Rs. 50,000 as costs in connection with the remand. The Court emphasised the requirement of natural justice under Section 73 of the CGST Act and declined to decide on the validity of the impugned notifications.

List of Cases Reviewed

• Sugandha Enterprises v. Commissioner of DGST [2025] 179 taxmann.com 399 (Delhi) (Para 10) followed
• DJST Traders (P.) Ltd. v. Union of India [2025] 174 taxmann.com 191 (Delhi)
• HCC-SEW-Meil-AAG JV v. Asstt. Commissioner of State Tax [2025] 174 taxmann.com 1080 (SC) (para 14) followed

List of Cases Referred to

• DJST Traders (P.) Ltd. v. Union of India [2025] 174 taxmann.com 191 (Delhi) (para 4)
• HCC-SEW-Meil-AAG JV v. Asstt. Commissioner of State Tax [2025] 174 taxmann.com 1080 (SC) (para 5)
• Engineers India Ltd. v. Union of India [W.P. (C) No. 9214 of 2024, dated 23-4-2025] (para 6)
• Sugandha Enterprises v. Commissioner of DGST [2025] 179 taxmann.com 399 (Delhi) (para 9).

The post HC Sets Aside GST Order for Lack of Hearing | Matter Remanded with Rs. 50,000 Cost appeared first on Taxmann Blog.

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Case Details: Sanjeev Tyagi vs. Deputy Director Directorate of Enforcement, Delhi - [2025] 180 taxmann.com 393 (SAFEMA-New Delhi)

Judiciary and Counsel Details

• V. Anandarajan, Member
• Manav Gupta, Sahil, Abhinav Jain & Mithil Malhotra, Advs. for the Appellant.
• Aditya Singla, Adv. for the Respondent.

Facts of the Case

In the instant case, the Adjudicating Authority confirmed the attachment of various properties of the appellant made by the Directorate of Enforcement (ED) vide Provisional Attachment Order. The said order of the Adjudicating Authority confirming the attachment of properties had been contested by the appellant in appeals pending before the Appellate Tribunal.

The appellant filed an instant application praying that, without prejudice to the outcome of the main appeal, properties in respect of which the instant application had been filed might be allowed to be substituted with an equivalent security in the form of a bank guarantee or Fixed Deposit Receipts (FDRs).

It was noted that property was jointly owned by two appellants, who were both defendants before the Adjudicating Authority and were appellants before the Appellate Tribunal, pending outcome of main appeal, it would have to be presumed that entire property was prima-facie involved in money laundering and, therefore, question of accepting equivalent fixed deposits for a part of value of property would not arise.

It was further noted that in none of the cases cited by the appellant, it had been categorically held that the Appellate Tribunal had the requisite power to allow substitution of property.

Appellate Tribunal Held

The Appellate Tribunal held that, in the absence of any specific power vested in the Appellate Tribunal to allow substitution of attached property, the instant application was to be dismissed.

List of Cases Reviewed

• Gagan Infraenergy Ltd. v. Deputy Director Directorate of Enforcement [2024] 164 taxmann.com 415 (Delhi)/[2024 SCC OnLine Del 4019]
• Revati Cements (P.) Ltd. v. Union of India [2024] 164 taxmann.com 13 (Delhi)/[2024 SCC OnLine Del 4020] (para 13)
• Agribiotech Industries Ltd. v. Deputy Director, ED FPA-PMLA-3025/JP/2019, order dated 29.05.2023 (para 19) followed
• Directorate of Enforcement v. Mahender Kumar Khandelwal LPA No. 148/2024, dated 6-6-2024 (para 6)
• Esskay Properties and Investment (P.) Ltd. v. Union of India Special Leave to Appeal (c) No. 9335 of 2022, dated 16-9-2022 (para 7) distinguished

List of Cases Referred to

• Gagan Infraenergy Ltd. v. Deputy Director Directorate of Enforcement [2024] 164 taxmann.com 415 (Delhi) (para 4)
• VGN Property Developers (P.) Ltd. v. Deputy Director, Directorate of Enforcement, Chennai [2020] 116 taxmann.com 148 ((PMLA-AT), NEW DELHI) (para 4)
• Revati Cements (P.) Ltd. v. Union of India [2024] 164 taxmann.com 13 (Delhi) (para 4)
• Directorate of Enforcement v. Mahender Kumar Khandelwal [LPA No. 148/2024, dated 6-6-2024] (para 4)
• India Cements Ltd. v. Adjudicating Authority [WP (C) No. 9361 of 2015, dated 5-11-2015] (para 4)
• Enforcement Directorate v. Smt. Y.S. Bharathi Reddy [C. M. S. A. No. 15 of 2019, dated 28-11-2022] (para 4)
• Enforcement Directorate v. Smt. Y.S. Bharathi Reddy [SLP (crl.) Diary No. (s) 22285 of 2023, dated 14-7-2023] (para 4)
• Esskay Properties and Investment (P.) Ltd. v. Union of India [Special Leave to Appeal (c) No. 9335 of 2022, dated 16-9-2022] (para 4)
• Joint Director, Directorate of Enforcement v. A. Raja [CRL. L.P. No. 184 of 2018, dated 20-9-2023] (para 4)
• Hetero Drugs Ltd. v. Dy. Director, Directorate of Enforcement, Delhi 2017 (354) E.L.T. 369 (ATPMLA) (para 5)
• Ara Properties v. Deputy Director, Directorate of Enforcement, Mumbai [2024] 165 taxmann.com 203 (SAFEMA – New Delhi) (para 5)
• Sanghavi Bullion Pvt. Ltd. v. Deputy Director Directorate of Enforcement [FPA-PMLA-5895/MUM/2023, dated 29-5-2024] (para 11)
• Agribiotech Industries Ltd. v. Deputy Director, ED [FPA-PMLA-3025/JP/2019, order dated 29.05.2023] (para 19).

The post Appellate Tribunal Cannot Substitute Attached Property with FDRs or Guarantees | SAFEMA appeared first on Taxmann Blog.

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Case Details: Concept Eateries (P.) Ltd. vs. Union of India - [2025] 180 taxmann.com 692 (Delhi)

Judiciary and Counsel Details

• Prathiba M. Singh & Shail Jain, JJ.
• Puneet Rai, Adv. for the Petitioner.
• Vaishali Gupta, Panel Counsel for the Respondent.

Facts of the Case

The petitioner filed a challenge against a show cause notice and the consequential order issued under the CGST Act and the Delhi GST Act for the financial year 2019-20. It was contended that the firm’s GST consultant, who was responsible for managing all GST-related filings and communications, had failed to examine the notice within the prescribed time, which prevented the petitioner from submitting a response or participating in the proceedings. The petitioner also challenged the validity of notifications under the CGST Act extending the limitation period. In view of these contentions, the matter was brought before the High Court.

High Court Held

The High Court held that the impugned order was liable to be set aside due to lack of proper hearing and remanded the matter for fresh adjudication, directing that the petitioner be given an opportunity to respond to the show cause notice. The Court emphasised the principles of natural justice under Section 73 of the CGST Act and Delhi GST Act. On the challenge to the notifications, the Court observed that the issue was pending before the Supreme Court in HCC‑SEW‑Meil‑AAG JV v. Asstt. Commissioner of State Tax and deferred any decision, leaving it contingent on the Supreme Court’s outcome.

List of Cases Reviewed

• Sugandha Enterprises v. Commissioner of DGST [2025] 179 taxmann.com 399 (Delhi) (Para 10) followed
• DJST Traders (P.) Ltd. v. Union of India [2025] 174 taxmann.com 191 (Delhi) (para 5)
• HCC-SEW-Meil-AAG JV v. Asstt. Commissioner of State Tax [2025] 174 taxmann.com 1080 (SC) (para 14) followed

List of Cases Referred to

• DJST Traders (P.) Ltd. v. Union of India [2025] 174 taxmann.com 191 (Delhi) (para 4)
• HCC-SEW-Meil-AAG JV v. Asstt. Commissioner of State Tax [2025] 174 taxmann.com 1080 (SC) (para 5)
• Engineers India Ltd. v. Union of India [W.P. (C) No. 9214 of 2024, dated 23-4-2025] (para 6)
• Sugandha Enterprises v. Commissioner of DGST [2025] 179 taxmann.com 399 (Delhi) (para 9).

The post Matter Remanded After Assessee Missed SCN Due to Consultant | HC Sets Aside GST Order appeared first on Taxmann Blog.

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1. Facts

A Limited, a public company (hereinafter referred to as ‘the company’) under the Ministry of Shipping, is engaged in dredging operations across major and minor ports and operates a fleet of various dredgers and ancillary crafts. Four dredgers have completed their estimated useful life of twenty-five years, but continue in active use. The Company depreciates its dredgers over twenty-five years with a residual value of two percent.

All dredgers must undergo periodic IRS inspections every three to five years to remain operational. These inspections require significant dry dock expenditure, including overhaul and repair costs, and the Company capitalises such expenditure as major inspection costs in accordance with paragraph 14 of Ind AS 16, derecognising the previous inspection component.

During the audit for 2021-22 to 2023-24, the CAG observed that dry dock expenditure on dredgers whose useful lives had expired was capitalised, which, in its view, was inconsistent with the Company’s accounting policy and an earlier EAC opinion issued under the IGAAP framework. The CAG held that such costs should have been expensed as repairs and maintenance.

The Company submitted that the earlier EAC opinion was under IGAAP and did not consider Ind AS requirements, including component accounting. It referred to industry guidance and a 2023 EAC opinion permitting capitalisation of subsequent expenditure where future economic benefits arise, even if the main asset has completed its useful life. Dry dock expenditure, in the Company’s view, restores operational utility and extends the dredgers’ usable life; accordingly, the useful lives of the concerned dredgers were reviewed and extended up to the next dry dock cycle in line with paragraph 51 of Ind AS 16.

State whether such treatment is appropriate and whether subsequent expenditure can be capitalised even after the expiry of a dredger’s original useful life.

2. Relevant Provisions

Ind AS 16 – Property, Plant and Equipment

Para 7

The cost of an item of property, plant and equipment shall be recognised as an asset if, and only if:

(a) it is probable that future economic benefits associated with the item will flow to the entity; and

(b) the cost of the item can be measured reliably.

Para 13

Parts of some items of property, plant and equipment may require replacement at regular intervals. For example, a furnace may require relining after a specified number of hours of use, or aircraft interiors such as seats and galleys may require replacement several times during the life of the airframe. Items of property, plant and equipment may also be acquired to make a less frequently recurring replacement, such as replacing the interior walls of a building, or to make a non-recurring replacement. Under the recognition principle in paragraph 7, an entity recognises in the carrying amount of an item of property, plant and equipment the cost of replacing part of such an item when that cost is incurred if the recognition criteria are met. The carrying amount of those parts that are replaced is derecognised in accordance with the derecognition provisions of this Standard.

Para 14

A condition of continuing to operate an item of property, plant and equipment (for example, an aircraft) may be performing regular major inspections for faults regardless of whether parts of the item are replaced. When each major inspection is performed, its cost is recognised in the carrying amount of the item of property, plant and equipment as a replacement if the recognition criteria are satisfied. Any remaining carrying amount of the cost of the previous inspection (as distinct from physical parts) is derecognised. This occurs regardless of whether the cost of the previous inspection was identified in the transaction in which the item was acquired or constructed. If necessary, the estimated cost of a future similar inspection may be used as an indication of what the cost of the existing inspection component was when the item was acquired or constructed.

Para 43

Each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the item shall be depreciated separately.

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PR no. 2025-2026/1589; Dated: 28.11.2025

The Reserve Bank of India (RBI) has issued the final Digital Banking Channels Authorisation Directions, 2025, establishing a comprehensive regulatory framework for digital banking operations in India. These Directions apply to all banks authorised to operate in India, including both commercial banks and cooperative banks.

1. Scope and Applicability

The Directions govern the authorisation, governance, and conduct of digital banking channels offered by banks. They aim to ensure secure, reliable, and customer-centric digital banking services across the sector.

Applicability extends to:

• Scheduled commercial banks
• Small finance banks
• Payments banks (as applicable)
• Urban and state cooperative banks

2. Eligibility Criteria for View-Only Digital Banking

The Directions prescribe specific conditions for banks seeking to offer non-transactional or view-only digital facilities. These include:

• Demonstration of robust internal systems for data display
• Adequate cybersecurity safeguards
• Proper customer authentication mechanisms
• Compliance with IT governance standards prior to launch

These facilities enable customers to access account statements, balances, and other information without initiating transactions.

3. Eligibility Criteria for Transactional Digital Banking

Banks intending to provide full-fledged digital banking services—such as payments, transfers, and other online transactions—must meet enhanced eligibility norms, including:

• Strong operational resilience frameworks
• End-to-end encrypted digital infrastructure
• Tested and audited transaction and reconciliation systems
• Adequate fraud monitoring, alerting, and reporting mechanisms

The aim is to ensure smooth, secure, and reliable digital transactions for customers.

4. Technological Guidelines for Digital Banking

RBI has laid down detailed instructions on technology standards, including:

• IT governance, risk, and compliance frameworks
• Cybersecurity guidelines, including periodic audits and threat monitoring
• Requirements for high system availability and disaster recovery
• Data protection and privacy standards
• Use of secure APIs and third-party integration protocols

These guidelines ensure that digital channels remain resilient and function with minimal disruptions.

5. General Operational Guidelines

The Directions also provide common operational requirements applicable across all digital banking channels, such as:

• Mandatory board and senior management oversight
• Periodic reporting to RBI
• Transparent disclosure requirements
• Internal audit and compliance review obligations
• Policies on outsourcing technology or operational functions

These requirements help maintain consistency and governance across digital banking platforms.

6. Customer Conduct & Additional Instructions

The Directions emphasise customer protection and responsible conduct requirements, covering:

• Clear communication of terms, charges, and limits
• Robust grievance redressal mechanisms
• Standards to ensure fair treatment of customers
• Measures to prevent customer misuse or risky behaviour
• Liability allocation in cases of unauthorised transactions

Banks must ensure customer awareness, provide timely notifications, and maintain transparency across services.

7. Conclusion

The Digital Banking Channels Authorisation Directions, 2025 strengthen India’s digital banking landscape by setting unified standards for authorisation, security, and customer protection. With these Directions, the RBI aims to improve the resilience, reliability, and consumer-centric nature of digital banking across all authorised banks.

Click Here To Read The Full Press Release

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PR No.77/2025; Dated: 28.11.2025

The Securities and Exchange Board of India (SEBI) has approved the substitution of the existing SEBI (Informal Guidance) Scheme, 2003 with a new and more comprehensive framework titled the SEBI (Informal Guidance) Scheme, 2025. The updated scheme aims to modernise, expand, and streamline the process of seeking regulatory clarity from SEBI.

1. Broader Scope Under the New Scheme

The 2025 Scheme significantly broadens the categories of entities eligible to approach SEBI for interpretative guidance. Under the revised framework, the following regulated entities may now seek informal guidance:

• Stock Exchanges
• Clearing Corporations
• Depositories
• Other intermediaries and market infrastructure institutions

This expansion ensures that a wider range of market participants can obtain regulatory clarity, thereby enhancing compliance standards and reducing interpretational uncertainties.

2. Modernised Framework for Regulatory Clarifications

The new Scheme seeks to:

• Ensure uniformity and transparency in SEBI’s guidance process
• Address evolving market structures and regulatory needs
• Provide timely and reliable interpretational support
• Replace the outdated 2003 framework with a more relevant and robust mechanism

3. Applicability and Transition

SEBI has clarified that from 01 December 2025 onwards, the processing of all informal guidance applications—whether newly submitted or pending—shall be governed under the SEBI (Informal Guidance) Scheme, 2025.

This ensures a seamless transition and consistent application of the updated regulatory framework.

4. Conclusion

The introduction of the SEBI (Informal Guidance) Scheme, 2025 marks a significant step toward strengthening regulatory clarity and stakeholder engagement. By widening the scope and modernising the process, SEBI aims to facilitate better compliance and foster a more transparent, informed, and efficient securities market ecosystem.

Click Here To Read The Full Press Release

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