Case Details: Sanjabij Tari vs. Kishore S. Borcar - [2025] 180 taxmann.com 701 (SC)

Judiciary and Counsel Details

• Manmohan & N.V. Anjaria, JJ.
• Amarjit Singh Bedi, Ms. Surekha Raman, Shreyash Kumar, Harshit Singh & Sidharth Nair, Advs. for the Appellant.
• Ankit Yadav, Ms. Gunjan Rathore, Ms. Shivangi Gulati, Chaitanya Sonkeria, Ms. Aastha Harshwal, Advs., T. Mahipal & Merusagar Samantaray, AORs for the Respondent.

Facts of the Case

The instant case concerns a loan transaction between the appellant-complainant and the accused, wherein the appellant had advanced a loan to the accused. Towards repayment of the said loan, the accused issued cheques in favour of the appellant. However, upon presentation, the cheques were dishonoured. Consequently, the appellant initiated proceedings against the accused under section 138 of the Negotiable Instruments Act, 1881.

The Trial Court, after appreciating the evidence on record, held that the accused had failed to rebut the statutory presumptions under sections 118 and 139 of the Act and that the appellant had successfully proved the existence of a legally enforceable debt. The contention of the accused that the appellant lacked the financial capacity to advance the loan was also rejected. The Sessions Court, in appeal, concurred with the findings of the Trial Court and dismissed the appeal filed by the accused.

However, the High Court, in revision, accepted the defence of the accused that the cheque in question was a signed blank cheque issued only to enable the appellant (a friend of the accused) to obtain a loan from a bank. On this basis alone, the High Court held that the presumptions under sections 118 and 139 stood rebutted and consequently acquitted the accused of the offence under section 138. Notably, the accused had neither produced any documentary evidence nor examined any independent witness, nor led any cogent evidence to establish either the alleged defence or the financial incapacity of the appellant to advance the loan.

Supreme Court Held

On appeal, the Supreme Court held that the High Court had erred in exercising its revisional jurisdiction by acquitting the accused on the basis of a mere bald explanation, unsupported by any evidence. It was observed that a vague plea of issuance of a signed blank cheque, without any corroborative material, is insufficient to rebut the statutory presumptions. Accordingly, the impugned order of the High Court was set aside, and the judgments and orders passed by the Trial Court and the Sessions Court were restored. The accused was directed to pay the outstanding cheque amount to the appellant in 15 equated monthly instalments.

List of Cases Referred to

• Rangappa v. Sri Mohan [2010] 100 SCL 389 (SC) (para 8)
• APS Forex Services (P.) Ltd. v. Shakti International Fashion Linkers [2020] 114 taxmann.com 367/159 SCL 1 (SC) (para 9)
• Krishna Janardhan Bhat vs. Dattatraya G. Hegde (2008) 4 SCC 54 (para 15)
• Bir Singh v. Mukesh Kumar [2019] 103 taxmann.com 228/152 SCL 563 (SC) (para 17)
• P.C. Hari v. Shine Varghese 2025 SCC OnLine Ker 5535 (para 19)
• Rajaram v. Maruthachalam [2023] 146 taxmann.com 336/177 SCL 22 (SC) (para 22)
• Southern Sales & Services v. Sauermilch Design and Handels GMBH (2008) 14 SCC 457 (para 27)
• Tedhi Singh v. Narayan Dass Mahant [2022] 136 taxmann.com 177/171 SCL 580 (SC) (para 29)
• M.M.T.C. Ltd. v. Medchl Chemicals & Pharma (P.) Ltd. [2001] 45 CLA 374/[2002] 108 COMP CASE 48/1 COMP. LJ 58/39 SCL 270 (SC) (para 30)
• Damodar S. Prabhu v. Sayed Babalal H. [2010] 159 COMP CASE 1/101 SCL 27 (SC) (para 33)
• Indian Bank Association v. Union of India [2014] 45 taxmann.com 79/121 CLA 1/184 COMP CASE 377/3 COMP. LJ 277/126 SCL 349 (SC) (para 33)
• Expeditious Trial of Cases Under Section 138 of N.I. Act, 1881, In re [2021] 127 taxmann.com 23/167 SCL 103 (SC) (para 33)
• P. Mohanraj v. Shah Brothers Ispat (P.) Ltd. [2021] 125 taxmann.com 39/167 SCL 327 (SC) (para 34)
• Chellammal v. State 2025 SCC OnLine SC 870 (para 35)
• Gian Chand Garg v. Harpal Singh [Criminal Appeal No. 3789 of 2025, dated 11-8-2025] (para 35)
• M.V. Nalinakshan vs. M. Rameshan 2009 All MR (Cri) Journal 273 (para 35)
• Ashok v. Fayaz Aahmad 2025 SCC OnLine Kar 490 (para 36)
• Rajesh Agarwal v. State [2010] 159 COMP CASE 13 (Delhi) (para 36).

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Notification No. 19/2025–Central Tax (Rate), Dated 31-12-2025

1. Introduction

The Central Government has amended the GST rate structure for pan masala, tobacco, and related products through Notification No. 19/2025–Central Tax (Rate), dated 31 December 2025. The revised rates will be applicable to supplies made on or after 1 February 2026.

2. Amendment To Existing GST Notification

The notification amends Notification No. 9/2025–Central Tax (Rate), dated 17 September 2025, by restructuring the applicable GST rate schedules for specified tobacco-related goods. The amendment revises product placement across GST schedules to rationalise the applicable tax rates.

3. Revised Classification Of Goods

Pursuant to the amendment, biris have been inserted under Schedule II, making them taxable at 9% CGST. Further, pan masala and specified tobacco and tobacco-substitute products, including inhalation products, have been placed under Schedule III, attracting 20% CGST.

4. Omission Of Schedule VII And Rate Impact

The amendment omits Schedule VII, which earlier prescribed a 14% CGST rate for certain goods. As a result, the 14% CGST rate is no longer applicable to the notified products, and tax liability will now arise only at the revised rates under Schedules II and III.

5. Conclusion

The revised GST rate schedules will apply to all relevant supplies effected on or after 1 February 2026. Businesses dealing in pan masala, tobacco, and related products should update their tax configurations and compliance processes to align with the revised classification and rates.

Click Here To Read The Full Notification 

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PRESS RELEASE: 2025-2026/1824, Dated: 01.01.2026

1. Introduction

The Reserve Bank of India (RBI) has amended the concentration risk management framework applicable to Non-Banking Financial Companies (NBFCs) by introducing specific criteria for classifying certain infrastructure lending as high-quality infrastructure projects.

2. Amendment To Concentration Risk Directions

The amendment has been notified through the RBI (Non-Banking Financial Companies – Concentration Risk Management) Amendment Directions, 2026, issued vide Press Release No. 2025-2026/1824 dated 1 January 2026. The changes are aimed at refining exposure norms and aligning risk treatment with project quality.

3. Classification Of High-Quality Infrastructure Lending

The amendment inserts a proviso to sub-paragraph 4(4), laying down the conditions under which infrastructure lending meeting specified criteria shall qualify as lending to high-quality infrastructure projects. This classification allows such exposures to be treated differently for concentration risk purposes.

4. Applicability And Implementation Timeline

The amended provisions will apply when NBFCs implement the capital adequacy amendment directions, or from 1 April 2026, whichever is earlier. NBFCs are required to review their infrastructure loan portfolios in light of the revised classification framework.

5. Conclusion

The RBI’s amendment provides greater clarity on the treatment of eligible infrastructure lending under concentration risk norms. NBFCs should assess compliance readiness and ensure alignment with the revised directions within the prescribed timelines.

Click Here To Read The Full Press Release 

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Case Details: Ashok Kumar Dabas vs. Delhi Transport Corporation - [2025] 181 taxmann.com 327 (SC)

Judiciary and Counsel Details

• Rajesh Bindal  & Manmohan, JJ.
• Narender Kumar Verma, Aor for the Petitioner.
• Aviral Saxena, AOR, Abhinav Sharma, Paritosh Goyal & Vedant Varshney, Advs. for the Respondent.

Facts of the Case

In the instant case, the Deceased employee was working with the Delhi Transport Corporation (DTC). He had resigned from his job with the respondent, which is a corporation, after putting in more than 20 years of service. The competent authority accepted his resignation.

Later, his legal heirs claimed the release of the deceased employee’s pensionary benefits. The Respondent informed him that he was found entitled only to the provident fund and no other benefits.

The Tribunal and the High Court upheld the order of the respondent. Thereafter, an appeal was made before the Supreme Court.

It was noted that Rule 26 of the Central Civil Services (Pension) Rules, 1972, clearly shows that the resignation from service entails forfeiture of past service. Further, in terms of section 4 of the Payment of Gratuity Act, 1972, an employee who had rendered not less than five years of service would be entitled to the payment of gratuity, regardless of the fact that he had retired or resigned from the service.

Supreme Court Held

The Supreme Court held that since the deceased employee had resigned from service, his legal heirs were not entitled to any pension. Further, since the respondent could not establish that the Payment of Gratuity Act, 1972, did not apply to the Corporation, the legal heirs of the deceased employee were held entitled to receive the gratuity in terms of the provisions of the 1972 Act for the service rendered by him. Therefore, they were also entitled to receive an amount towards their leave encashment.

List of Cases Reviewed

• Order of High Court of Delhi in WP(C) No. 13642-2018, dated 20-12-2022 (para 12) reversed

List of Cases Referred to

• Ashok Kumar Dabas v. Delhi Transport Corporation [O. A. No. 4645 of 2015, dated 24-9-2018] (para 2)
• Ashok Kumar Dabas v. Delhi Transport Corporation [R. A. No. 207 of 2018, dated 29-10-2018] (para 2)
• Shashikala Devi v. Central Bank of India [2015] 12 taxmann.com 790 (SC) (para 5.1)
• Reserve Bank of India v. Cecil Dennis Solomon [2004] 2003 taxmann.com 4421 (SC) (para 5.1)
• Shanti Devi v. Delhi Transport Corporation [W. P. (C) No. 4871 of 2010, dated 15-10-2012] (para 5.1)
• Delhi Transport Corporation v. Ram Kishan [W. P. (C) No. 2627 of 2015, dated 17-3-2015] (para 5.1)
• BSES Yamuna Power Ltd. v. Ghanshyam Chand Sharma [2019] 112 taxmann.com 128 (SC) (para 6)
• Raj Kumar v. Union of India 2017 SCC OnLine Del 10877 (para 6).

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Notification no. GSR 940(E); Dated: 31.12.2025

1. Introduction

The Central Government has amended the rules governing the removal of company names from the Register of Companies through Notification No. GSR 940(E), dated 31 December 2025. The amendment introduces a specific procedural requirement for Government Companies and their subsidiaries.

2. Amendment To Removal Of Names Rules

The notification brings into effect the Companies (Removal of Names of Companies from the Register of Companies) Amendment Rules, 2025. These amendments modify the existing framework under which companies may apply for or be subjected to removal of their names from the Register of Companies.

3. Special Provision For Government Companies

As per the amended norms, where the company concerned is a Government Company, including its subsidiaries, additional safeguards have been prescribed. The amendment specifically addresses cases involving directors appointed or nominated by the Central or State Government.

4. Indemnity Bond Authorisation Requirement

The rules now mandate that the indemnity bond in respect of one or more Government-appointed or nominated directors must be executed by an authorised representative not below the rank of Under Secretary or equivalent. Such authorisation must be from the concerned administrative Ministry or Department of the Government of India or the State Government, as applicable.

5. Conclusion

The amendment strengthens accountability and procedural clarity in cases involving Government Companies seeking removal of their names. Stakeholders should ensure compliance with the revised indemnity bond requirements while initiating name-removal applications under the amended rules.

Click Here To Read The Full Notification 

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Press Release; Dated: 01.01.2026

1. Introduction

The Ministry of Corporate Affairs (MCA) has simplified director compliance requirements by replacing the annual Director KYC filing with a once-in-three-years KYC intimation. The change has been notified through a press release dated 1 January 2026.

2. Amendment To Rule 12A

To give effect to this change, MCA has amended Rule 12A of the Companies (Appointment and Qualification of Directors) Rules, 2014. The amendment does away with the mandatory annual KYC filing and introduces a streamlined compliance mechanism aimed at reducing the recurring compliance burden on directors.

3. Revised KYC Intimation Framework

Under the revised framework, directors are required to file a simplified KYC intimation once every three years using a revised KYC form. The form captures essential particulars such as mobile number, email address, and residential address, ensuring that MCA records remain updated without repetitive filings.

4. Verification And DIN Reactivation

The amendment provides for reactivation of Director Identification Number (DIN) through the revised KYC process. Verification and professional certification requirements have been restricted to specified cases only, making the process more efficient while maintaining regulatory safeguards.

5. Conclusion

The replacement of annual Director KYC with a triennial KYC intimation marks a significant step towards ease of compliance. Directors and companies should familiarise themselves with the revised filing requirements to ensure timely and accurate compliance under the amended Rule 12A.

Click Here To Read The Full Press Release 

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Case Details: Dhl Express (India) (P.) Ltd. vs. Union of India - [2025] 181 taxmann.com 697 (Delhi)

Judiciary and Counsel Details

• Prathiba M. Singh & Shail Jain, JJ.
• Rohan Shah, Sr. Adv. & Mohammed Anajwalla, Adv. for the Petitioner.
• Ms Vaishali Gupta, Panel Counsel, Akash Panwar, Jr. Standing Counsel, Ms Jasleen Kaur Anand, Adv. & Ajay Chowdhary, SPC for the Respondent.

Facts of the Case

The petitioner-assessee was providing courier and shipment delivery services under a Network Agreement with a foreign entity located in Germany, pursuant to which their respective clients were serviced in India and Germany without any consideration being exchanged between the two entities. The petitioner discharged tax treating the activity as a supply of service under section 7(1)(a) of the CGST Act, despite absence of consideration. It was submitted that since the recipient entity was located outside India, the services qualified as export of services and zero-rated supply under section 16 of the IGST Act, notwithstanding non-receipt of consideration in convertible foreign exchange. The petitioner contended that the statutory conditions governing zero-rated supply created an incongruity requiring interpretation by the High Court. The matter was accordingly placed before the High Court.

High Court Held

The High Court held that non-receipt of consideration in convertible foreign exchange does not exempt the assessee from payment of tax on the supply of services, but only disentitles the assessee from availing benefits arising from export of services. It held that section 7 of the CGST Act, read with sections 16(1)(a) and 2(6) of the IGST Act, requires harmonious interpretation to determine taxability and eligibility for zero-rated treatment. The Court observed that absence of foreign exchange realization impacts only export benefits and not the levy of tax. Noting that similar issues were pending before multiple High Courts, the Court observed that the Central Board of Indirect Taxes and Customs (CBIC) should examine the issue and place its stand before the High Court.

List of Cases Referred to

• DHL Express India (P) Ltd. v. Union of India [Writ Petition No. 3977 of 2025, dated 19-11-2025] (para 11)
• Mafatlal Industries Ltd. v. Union of India (1997) 5 SCC 536 (para 12).

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1. Introduction

The Institute of Chartered Accountants of India (ICAI) has extended the applicability of Phase IV of the Peer Review mandate, providing additional time for Practice Units to comply with the peer review requirements before undertaking specified audit engagements.

2. Applicability Of Peer Review Mandate

Under the Peer Review framework, Practice Units proposing to audit branches of Public Sector Banks and firms having three or more partners rendering attestation services are required to hold a valid Peer Review Certificate prior to accepting statutory audit assignments.

3. Phase IV Peer Review Timeline

Phase IV of the Peer Review mandate was scheduled to become applicable from 1 January 2026. However, considering practical challenges and representations from members, the ICAI Council has decided to extend the applicability period.

4. Extended Deadline And Relief Granted

The ICAI Council has now extended the Phase IV Peer Review mandate up to 31 December 2026. This extension provides significant relief to eligible Practice Units, allowing additional time to complete the peer review process without affecting their eligibility for statutory audits.

5. Conclusion

The extension of Phase IV of the Peer Review mandate offers a welcome compliance window for Practice Units. Firms should utilise this extended timeline to complete the peer review process and ensure uninterrupted eligibility for statutory and bank branch audit assignments.

Click Here To Read The Full Story 

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NOTIFICATION NO. F. NO. IFSCA/INDIA ICC/RENEWAL/2025-26, Dated: 01.01.2026

1. Introduction

The International Financial Services Centres Authority (IFSCA) has granted renewal of recognition to India International Clearing Corporation Limited (India ICC) in the interest of trade, the securities market, and the public interest.

2. Notification And Authority

The renewal has been accorded vide Notification No. F. No. IFSCA/INDIA ICC/RENEWAL/2025-26, dated 1 January 2026. The decision follows IFSCA’s assessment of the clearing corporation’s regulatory compliance and operational framework.

3. Period Of Renewal

The recognition has been renewed for a period of three years, commencing from 29 December 2025 and continuing until 28 December 2028, unless modified or withdrawn in accordance with applicable regulations.

4. Conditions Attached To Recognition

The renewal is subject to the condition that India International Clearing Corporation Limited shall comply with all conditions specified by IFSCA from time to time. Ongoing adherence to regulatory, governance, and risk-management requirements remains mandatory during the renewal period.

5. Conclusion

The renewal of recognition reaffirms IFSCA’s confidence in the functioning of India ICC and its role in supporting the IFSC securities market. Continued compliance with IFSCA’s regulatory framework will be essential throughout the renewed term.

Click Here To Read The Full Notification 

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1. Introduction

The National Financial Reporting Authority (NFRA) has issued a Staff Series document titled “Risk & Response Memorandum: ROMM Assessment at Assertion Level for Revenue – A Sample Document”. The publication serves as an educational and illustrative guide, demonstrating how auditors should perform and document a robust Risk of Material Misstatement (ROMM) assessment in compliance with Standards on Auditing (SAs).

2. Risk Assessment – The Cornerstone of Audit Planning

The toolkit issued by NFRA discusses about that risk assessment under SA 315, Identifying and Assessing the Risks of Material Misstatement Through Understanding the Entity and Its Environment. Further, it suggests that theauditors are required to identify and assess ROMM through a comprehensive understanding of:

(a) The entity and its operating environment

(b) The applicable financial reporting framework

(c) The design and operating effectiveness of internal controls, including IT systems

Risk of Material Misstatement (ROMM) exists at both the financial statement level and the assertion level for classes of transactions, account balances and disclosures. At the assertion level inherent risk and control risk exist, while detection risk is addressed through appropriately designed audit procedures.

3. Identifying What Could Go Wrong

The NFRA guidance underscores the importance of linking identified risks to specific assertions such as occurrence, completeness, accuracy, cut-off and valuation. Auditors are expected to articulate “what could go wrong” at the assertion level and evaluate whether existing controls are capable of preventing or detecting material misstatements on a timely basis.

The toolkit also recognises situations where substantive procedures alone may be insufficient, particularly in highly automated, high-volume transactions environments, thereby necessitating reliance on controls.

4. Illustrative case study – Revenue audit of a pharmaceutical company

Using a hypothetical listed pharmaceutical company, the toolkit demonstrates a practical application of ROMM assessment for revenue from sale of products under Ind AS 115, Revenue from Contracts with Customers. Key risk drivers identified by NFRA include:

(a) Variable consideration in the form of discounts, rebates and sales returns

(b) Large transaction volumes processed through automated ERP systems

(c) Increased susceptibility to cut-off errors near period-end

(d) Potential management bias in estimating sales returns and chargebacks

5. Aligning Risks with Audit Responses

A key strength of the NFRA toolkit is its clear demonstration of how identified ROMMs have impacts on auditor’s response. Further, this toolkit also maps each identified risk with relevant assertions, manual and automated controls, control reliance strategy. It also discusses about the nature, timing and extent of substantive procedures.

Moreover, illustrative procedures include customer confirmations, invoice-to-delivery testing, period-end cut-off testing, post year-end sales return analysis and detailed testing of management estimates using retrospective review techniques.

Click Here To Read The Full Story 

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