All You Need to Know About GST on Supply to SEZ Units

 The Goods and Services Tax (GST) regime provides a special status to Special Economic Zones (SEZs) in India. Recognized as duty-free enclaves, SEZs are treated as being outside the customs territory of India for trade and taxation purposes. Consequently, supplies made to SEZ units or developers enjoy unique tax treatment under GST law.

Resolution of TDS Credit Mismatch: Introduction of Form 71

 Taxpayers frequently encounter discrepancies between the Tax Deducted at Source (TDS) credits reflected in Form 26AS and the assessment year in which the corresponding income has been offered to tax. Such mismatches are often attributable to differences in timing arising from mercantile accounting practices or delayed deduction/deposit of TDS by the deductor.

Supreme Court Ruling on Accused's Right to Documents under PMLA

 In a significant judgment, the Supreme Court held that individuals accused under the Prevention of Money Laundering Act (PMLA) have the right to access both relied-upon and unrelied-upon documents seized by the Enforcement Directorate (ED). This aligns PMLA procedures with the Criminal Procedure Code (now BNSS, 2023).

Regulatory Updates

• GST: Auto-population in GSTR-3B Table 3.2 remains editable from April 2025 onwards for better accuracy in inter-state supplies.

• Customs Tariff Values: Revised for items like palm oil, gold, silver, and areca nuts.

• Import Restrictions: Certain Bangladeshi goods, including garments and food items, restricted to specific ports.

• Adjudication Guidelines: Defined for cases involving 100% EOUs with varying duty thresholds.

---

Key Judicial Decisions

• Entertainment & Service Tax: Supreme Court upheld concurrent levy on cable/DTH services by states and the center.

• Pre-deposit via Credit Ledger: Validated by SC; electronic credit ledger can be used for GST appeals.

• Unjust Enrichment: Not applicable to encashed bank guarantees meant as security.

• ITC on Buildings: Supreme Court dismissed a review petition; ITC can be availed on buildings treated as “plant”.

• Customs Valuation: Product support service cost includable in import value.

• ITC Refund: Permitted even if principal input and output have the same GST rate, due to higher-rated ancillary inputs.

• Limitation Period: Begins from rectification order date if merged with original adjudication.

• Rule 36(4) Validity: Restrictions on ITC for unmatched invoices upheld to protect revenue.

• Intermediary Scope: Service provider acting independently is not an intermediary; ITC refund granted.

SC upholds co-existence of both entertainment tax and service tax levy on broadcasting activities applying Aspect theory

 This Tax Alert summarizes a recent judgement of the Supreme Court (SC) on validity of both State levy (entertainment tax) and Central levy (service tax) w.r.t. same broadcasting activities.

The key observations of the SC are:

TAX DUE DATE - JUNE 2025

 

S. No	Due Date	Related to	Compliance to be made
1	11.06.2025	GST RET 01	Payment of GST and filing of return for the Month of May 2025
2	13.06.2025	ISD	Filing for the month of May 2025
3	20.06.2025	GST	Payment of GST for the month of May, 2025 Filing of GSTR 3B for the month of May, 2025
4	07.06.2025	TDS/TCS (Income Tax)	Deposit TDS for payments of Salary, Interest, Commission or Brokerage, Rent, Professional fee, payment to Contractors, etc. during the month of May  2025 Deposit TDS from Salaries deducted during the month of May 2025 Deposit TCS for collections made under section 206C including sale of scrap during the month of May  2025, if any
5	15.06.2025	Income tax	Payment of Advance tax for the Corporate assesses –Amount not less than 15% of advance tax.
6	30.06.2025	Equalisation levy annual return	Filing of equalisation levy annual return for 24-25

CBDT Extends Due Date for Filing Personal Income Tax Returns for FY 2024–25 to 15 September 2025

 Background

The Central Board of Direct Taxes (CBDT) has recently announced an extension of the due date for filing Income Tax Returns (ITRs) for the financial year 2024–25 (assessment year 2025–26), moving the deadline from 31 July 2025 to 15 September 2025. This decision comes in the context of substantial revisions made to the ITR forms and related procedural updates.

How NRI’s can save tax on their capital gain income.

An NRI Sold Indian Shares Worth ₹10 Crores and Paid ₹0 in Tax. Was he Evading Taxes? No! Here’s How NRIs Legally Pay ₹0 Tax Despite High Capital Gains 👇

 

GST Updates Effective from April 1, 2025: Key Changes for Businesses

 The Government of India has introduced significant GST updates effective April 1, 2025, aimed at simplifying compliance, enhancing security, and improving accuracy in tax reporting. Here's a quick rundown of the major changes:

A Global Minimum Tax Framework: Tackling Digitalisation and Base Erosion

 The rapid digitalisation and globalisation of the economy have created complex challenges for international tax systems. In response, the OECD/G20 Inclusive Framework on BEPS (Base Erosion and Profit Shifting) has developed the Global Anti-Base Erosion (GloBE) Model Rules—a coordinated approach aimed at ensuring multinational enterprises (MNEs) pay a fair share of tax, regardless of where they operate.

Transfer Pricing in the HO-PO Model: Key Considerations for Multinationals in India

 As India continues to attract foreign investment, multinational enterprises (MNEs) often choose to operate through a Project Office (PO) model to execute short- to medium-term projects. Under this setup, the Head Office (HO), based abroad, establishes a PO in India to locally manage and deliver projects. Though the HO and PO form part of a single legal entity, Indian tax laws treat them as distinct enterprises for transfer pricing (TP) purposes.

 

US to Levy 5% Tax on Immigrant Remittances

 A new bill working its way through the U.S. Congress may significantly impact the finances of Non-Resident Indians (NRIs) and other immigrants. Officially titled “The One Big Beautiful Bill,” the proposed legislation contains a 5% remittance tax on money sent abroad by non-citizens—including H-1B visa holders, green card holders, and other non-immigrant visa categories.

Other Comprehensive Income (OCI) — Simplified

 OCI is one of the least understood components of financial reporting under IFRS. Let’s break it down in a simple, practical way.

---

🔹 What is OCI?

Other Comprehensive Income (OCI) is part of the total income a business reports, but it’s not part of regular profit or loss. Instead, it captures gains and losses that arise from revaluation, translation, or remeasurement—things that aren’t part of your day-to-day operations.

---

🔹 Why Does OCI Matter?

It matters because it separates operating performance from changes in asset values or financial instruments. This separation gives a clearer picture of how well a business is truly performing operationally—without distortion from market fluctuations or accounting revaluations.

---

🔹 Common Examples of OCI Items

✅ Actuarial gains/losses on defined benefit pension plans
✅ Revaluation gains/losses on property, plant, and equipment
✅ Cash flow hedge adjustments
✅ Foreign currency translation differences for foreign operations
✅ Unrealized gains/losses on certain financial instruments (e.g., equity investments classified as FVOCI)

---

🔹 Simple Examples

• Asset Revaluation:
  A building owned by the company increases in value—from ₦90 million to ₦150 million.
  The ₦60 million gain doesn’t go into your operating profit—it goes into OCI.
  Why? Because the gain isn’t due to your business performance. It’s a paper gain from revaluation.

• Investment Loss:
  Your shares in a public company fall in value from ₦8 million to ₦3 million.
  That ₦5 million unrealized loss goes to OCI.
  Again, it’s not because of your business operations—it’s due to market fluctuations.

Bond Market Trends – April 2025

 In April 2025, Indian bond markets experienced a notable decline in yields across both government securities (G-Secs) and AAA-rated corporate bonds. This trend was driven by improved systemic liquidity, prompted by the Reserve Bank of India's Open Market Operations (OMOs) and increased government spending toward the end of the fiscal year.

Understanding Section 263 of the Income Tax Act, 1961: Power of Revision

 Section 263 of the Income Tax Act empowers the Principal Commissioner of Income Tax (PCIT) to revise an order passed by an Assessing Officer (AO) if two conditions are met simultaneously:

1. The order is erroneous (i.e., incorrect in law or facts).

Understanding Income Tax Notice under Section 142(1): What You Need to Know

 Receiving a notice from the Income Tax Department can be unsettling, but understanding its purpose and responding correctly can make the process smoother. One such commonly issued notice is under Section 142(1) of the Income Tax Act, 1961.

UK-India Double Contributions Convention (DCC)

On 6 May 2025, India and the UK finalized a landmark Free Trade Agreement (FTA). Alongside the FTA, India and the UK have agreed to negotiate a reciprocal Double Contributions Convention (DCC). The DCC will support business and trade by ensuring that employees moving between the UK and India, and their employers, will only be liable to pay social security contributions in one country at a time.

UK-India Free Trade Agreement (FTA)

 On 6 May 2025, India and the UK finalized a landmark Free Trade Agreement (FTA). Government of India has described this as “a historic and ambitious deal to boost jobs, exports, and national growth.” The FTA includes tariff elimination on 99% of Indian tariff lines, covering nearly 100% of trade value, and reduces tariffs on 90% of UK tariff lines, with an estimated annual economic boost of £4.8 billion (US$6.4 billion) for the UK by 2040.

HC rules refund cannot be recovered for violation of Rule 96(10) after its omission

 This Tax Alert summarizes a recent ruling of the Uttarakhand High Court (HC) ^[1] on validity of ongoing proceedings under Rule 96(10) of the Central Goods and Services Tax Rules, 2017 (CGST Rules) after its omission.

Rule 96(10) inter alia provides that a person cannot claim refund of integrated tax paid on export of goods or services if benefit of specified exemption notifications is availed. The said rule was omitted w.e.f. 8 October 2024.

Assessee, engaged in the manufacture of gold bar and jewellery, received a show cause notice on 26 September 2023, for recovery of incorrect refund of IGST in violation to Rule 96(10). The said demand was confirmed vide order dated 3 February 2025. Aggrieved, assessee challenged the order before HC, on the ground that it was issued after Rule 96(10) was omitted.

The key observations of the HC are:

Indirect Tax Regulatory Updates

Regulatory Updates

• Customs Amendment Rules, 2025: Terms like "certificate" replaced with "proof" of origin to broaden documentation scope.

• CAROTAR Guidelines Updated: "Proof of Origin" now includes self-declarations; updates made to FTA Cell responsibilities and ICES portal.