The week of 22–28 June 2026 witnessed significant regulatory developments across Income Tax, GST, Customs, SEBI, MCA, and RBI. Under Income Tax, the Central Government notified the Public Health Foundation of India and the University of Hyderabad for scientific research, enabling eligible tax deductions, while the Supreme Court remanded over 1,000 reassessment appeals following retrospective validation of reassessment proceedings by the Finance Act, 2026. GST updates included clarification on jurisdiction after taxpayer migration and important AAR rulings on charitable activity exemptions and non-taxability of compensation recovered from transporters. Customs introduced a Green Channel for emergency oil-spill response equipment and appointed a common adjudicating authority in a major customs matter. SEBI proposed reforms for investment adviser certifications, advertisement norms, and market infrastructure technology. RBI issued an extensive set of directions covering FEMA, NBFC regulation, credit derivatives, TReDS, customer liability in digital frauds, prudential norms, UPI-linked credit, pension recovery, and released several draft master directions to strengthen financial regulation.
Notifications & Circulars issued during week (22nd – 28th Jun 2026)
(Income Tax, GST, Central Excise, Custom Duty, DGFT, SEBI, MCA, IBBI, RBI)
(Click the Link for Notification/ Circular as issued)
A. Income Tax
Public Health Foundation of India, Delhi notified under section 45(4)(b) for Scientific Research: It notifies Public Health Foundation of India, Delhi for ‘Scientific Research’ under the category of ‘University, college or other institution’, for the purposes section 45(3)(a)(i) of the Income-tax Act, read with rules 32 and 34 of the Income-tax Rules. This section allows for deduction for any sum paid to such notified institutions for scientific research while computing income tax.
(Link: Income Tax notification 72/2026 Dated 25/06/2026)
University of Hyderabad, notified under section 45(4)(b) for Scientific Research: It notifies University of Hyderabad for ‘Scientific Research’ under the category of ‘University, college or other institution’, for the purposes section 45(3)(a)(i) of the Income-tax Act, read with rules 32 and 34 of the Income-tax Rules. This section allows for deduction for any sum paid to such notified institutions for scientific research while computing income tax.
(Link: Income Tax notification 71/2026 Dated 25/06/2026)
SC Remands Over 1000 Reassessment Appeals After Finance Act 2026 Changed Law: Case of ITO vs Tej Partap Singh, SC Judgement Dated 10th April 2026. The apex court remanded thousands of cases to various High Courts regarding the validity of reassessment notices issued by Jurisdictional Assessing Officers (JAOs) instead of the Faceless Assessment Authority. This decision followed the introduction of Section 147A via the Finance Act 2026, which retrospectively validates actions taken by JAOs from 1st April 2021.
B. GST
Clarification regarding jurisdiction in cases involving migration/ transfer of taxable persons to another jurisdiction: Where any action or proceeding has been validly undertaken by the transferor jurisdictional authority, the transferee jurisdictional authority shall act upon, give effect to, and proceed on the basis of such earlier valid action taken by the transferor jurisdictional authority, as if it had itself initiated the same. The transferee jurisdictional authority shall take over and conclude the same from the stage at which it stood at the time of migration/ transfer. The transferor jurisdiction authority shall not take any action or initiate proceedings against the taxable person, after he has migrated/ transferred to another jurisdiction.
(Link: CGST Circular 255/2026 Dated 25/06/2026)
AAR, Exemption under notification must be examined independently for Each Activity with Strict Reference to the Prescribed Conditions: Case of Sanskar Foundation, AAR Gujarat Ruling Dated 24th June 2026. AAR held that exemption under CGST Notification 12/2017 must be examined independently for each activity with strict reference to the conditions prescribed under the relevant exemption entry. It ruled that services rendered under the National Mental Health Programme, yoga camps, de-addiction awareness programmes, and cleaning and sanitation awareness programmes qualified as charitable activities under Entry 1, subject to the applicant possessing a valid registration under Section 12AB of the Income Tax Act.
— It further held that self-defence training conducted under Gujarat Police, the Suraksha Setu Programme, Government schools, vocational training at Kasturba Gandhi Balika Vidyalayas, and artisan training under the Pradhan Mantri Vishwakarma Scheme were exempt under Entry 72 since the services were supplied under Government training programmes substantially funded by the Central or State Government.
—However, exemption was denied for training under the Deen Dayal Upadhyaya Grameen Kaushalya Yojana because the applicant was not a recognised Project Implementation Agency as required under Entry 71. It also declined to rule on vocational training, computer training, ITI training and agricultural extension services due to the absence of supporting work orders and sufficient factual material. It also held that blood donation camps and road safety training did not fall within the statutory definition of “charitable activities” or “preventive health” under Entry 1 and, therefore, were not eligible for GST exemption.
(Link: AAR Gujarat Ruling Dated 24/06/2026)
AAR, Compensation recovered from transporters for transit losses and related defaults is not liable to GST: Case of Pon Pure Chemical India Pvt Ltd, AAR Gujarat Ruling Dated 24th June 2026. AAR held that compensation/liquidated damages recovered from transporters for damage, loss, or injury suffered during goods transportation, are intended to compensate for the actual loss or injury suffered. It does not qualify as consideration for a taxable supply.
(Link: AAR Gujarat Ruling Dated 24/06/2026)
C. Central Excise
No Notifications/ Circulars during the week.
D. Custom Duty
Common Adjudicating Authority appointed for Flexituff Customs SCN: CBIC has appointed Principal Commissioner/Commissioner of Customs, Indore Customs Headquarters, as common adjudicating authority for adjudication of multiple customs show cause notices issued against Flexituff Ventures International Limited, Flexituff International Ltd., and associated noticees.
(Link: Customs Notification 58/2026 (NT) Dated 22/06/2026)
Fast-Track Customs Clearance for Oil Spill Response Equipment: CBIC has established a Green Channel mechanism for expedited Customs clearance of pollution response equipment, materials, and related resources required during Oil and Hazardous and Noxious Substances (HNS) spill emergencies. It follows a request from the Indian Coast Guard to facilitate rapid deployment of equipment received from foreign governments, international organizations, and specialized response agencies when national response capacity is exceeded. Customs Zones must appoint a senior Nodal Officer to coordinate with the Coast Guard and other stakeholders, ensure 24×7 priority clearance, and serve as the single point of contact during emergencies.
(Link: Customs Instructions 11/2026 Dated 23/06/2026)
E. Directorate General of Foreign Trade (DGFT)
No Notifications/ Circulars during the week.
F. Securities and Exchange Board of India (SEBI)
Relaxation in certification requirement for Persons Associated with Investment Advice (PAIA): The circular relaxes the certification requirements for Persons Associated with Investment Advice (PAIA) who perform only sales and other non- core services. It has introduced a lighter certification requirement for staff such as sales personnel, relationship managers, and others who interact with clients but are not directly involved in providing investment advice. Such personnel must now pass the NISM Series-XXV-B: Persons Associated with Investment Advice (Sales and Other Non-Core Services) Certification Examination. PAIA involved in investment advisory functions will continue to require the NISM Series-X-A (Level 1) and Series-X-B (Level 2) certifications.
(Link: SEBI Circular Dated 24/06/2026)
Consultation Paper on Common Advertisement Code for Specified SEBI Regulated Entities: The paper proposes a Common Advertisement Code (CAC) for specified SEBI-regulated entities, including stock brokers, investment advisers, research analysts, portfolio managers, mutual funds, depository participants, and online bond platform providers. The key proposals include replacing mandatory prior approval of advertisements with post-issuance reporting within 24 hours, permitting celebrity endorsements for entity or brand promotion subject to prior approval, allowing use of PaRRVA-assigned ratings and rankings under prescribed conditions, introducing abbreviated disclosures for short-format digital communications, excluding genuine educational content from the definition of advertisements, prohibiting dark patterns, and establishing a technology-enabled reporting and monitoring system.
(Link: SEBI Consultation Paper Dated 23/06/2026)
Consultation Paper on Draft Circular for Trading Software and Technology at Stock Exchanges and Common IT related Provisions for MIIs: SEBI has issued a consultation paper proposing comprehensive rationalization and consolidation of regulations governing trading software, technology, and common IT-related provisions applicable to Stock Exchanges, Clearing Corporations, and Depositories (MIIs). The key changes include strengthening cybersecurity norms through updated encryption, mandatory two-factor authentication, enhanced firewall practices, and improved protection of sensitive authentication data. The paper also proposes removing outdated Wireless Application Protocol (WAP) provisions, streamlining Internet- Based Trading (IBT) and Securities Trading using Wireless Technology (STWT) requirements, expanding Direct Market Access (DMA) eligibility to more client categories, simplifying audit and record-keeping requirements, mandating robust backup systems, and consolidating IT provisions into unified circulars for Market Infrastructure Institutions.
(Link: SEBI Consultation Paper Dated 22/06/2026)
G. Ministry of Corporate Affairs (MCA)
NCLAT Allows Jagran EOGM but keeps Director Removal Resolutions in Abeyance: Case of Jagran Prakashan Ltd vs Mahendra Mohan Gupta, NCLAT Delhi Judgement Dated 26th May 2026. The appellate tribunal declined to stay the holding of the EOGM. However, it directed that implementation of any resolution passed at the EOGM shall remain in abeyance until the NCLT decides the pending issues relating to Article 4.1 and allied disputes.
H. Insolvency and Bankruptcy Board of India (IBBI)
No Notifications/ Circulars during the week.
I. Reserve Bank of India (RBI)
Amendments to RBI FEMA Deposit Regulations- Expands SNRR Account Framework: The amendment introduces the definition of International Financial Services Centre (IFSC) by adopting the meaning under the IFSCA Act. It permits persons resident outside India to open, hold, and maintain Special Non-Resident Rupee (SNRR) Accounts with authorised dealers in India, their overseas branches, and branches located in IFSCs. The scope of SNRR accounts has been expanded to facilitate permissible current and capital account transactions with residents and bona fide transactions with non-residents. It also permits specified transfers from NRO accounts to NRE and SNRR accounts within prescribed limits.
(Link: RBI FEMA Notification Dated 18/06/2026)
Master Direction- RBI Credit Derivatives Directions 2026: The Directions introduce a comprehensive regulatory regime governing Credit Default Swaps (CDS), Total Return Swaps (TRS), exchange-traded credit derivatives, and futures on credit indices. It prescribe eligibility criteria for market-makers and users, classify participants into retail and non-retail categories, specify permissible products, reference assets, settlement methods, reporting obligations, prudential norms, and customer protection measures. It also permits participation by eligible Foreign Portfolio Investors (FPIs) subject to prescribed limits and conditions, while establishing a Credit Derivatives Determinations Committee under FIMMDA to decide credit events and settlement matters.
(RBI Master Directions 407/2026 Dated 25/06/2026)
RBI Trade Receivables Discounting System Directions 2026: The Directions replaces the earlier guidelines with a to rationalise and harmonise the regulatory framework governing TReDS platforms. It streamline capital requirements for authorised entities by aligning them with other non-bank payment system operators, simplify the onboarding process for MSME sellers, and permit financiers to obtain credit guarantee cover for exposures undertaken through TReDS. It prescribe eligibility, authorisation, minimum net-worth requirements, participant categories, operational standards, customer due diligence, reporting obligations, and settlement mechanisms. Factoring transactions remain without recourse to MSME sellers, while buyers assume an unconditional payment obligation upon acceptance of invoices.
(RBI Directions 406/2026 Dated 23/06/2026)
Review of Circulars issued under Foreign Exchange Management Act (FEMA): Following the review of circulars issued since 1st June 2000, RBI has decided to withdraw the circulars listed in the Annex, as they have become inoperative due to subsequent regulatory amendments, redundancy, overlap, or replacement by newer directives. The RBI has directed all Authorised Persons to inform their constituents about the withdrawal of these circulars.
(Link: RBI Circular 175/2026 Dated 24/06/2026)
Modification of Returns and Reporting requirements under FEMA: The circular prescribes revised reporting formats and simplifies compliance for Authorised Persons, Full- Fledged Money Changers (FFMCs), Authorised Dealer Category-II entities, and Indian Agents under Money Transfer Service Scheme (MTSS). The key changes include revising the FLM-8 return to capture foreign currency note write-offs, removing the requirement for prior RBI approval for write-offs exceeding USD 2,000, and exempting entities reporting through FETERS from filing FLM-8. Authorised Persons and MTSS Indian Agents must submit quarterly lists of franchisees and sub-agents, respectively.
(Link: RBI Circular 174/2026 Dated 24/06/2026)
Amendments to RBI Responsible Business Conduct Directions- Limiting Customer Liability in Digital Transactions: These Directions are applicable to Commercial Banks, Small Finance Banks, Payments Banks, Local Area Banks, Local Area Banks, Regional Rural Banks, Urban Coop Banks and Rural Coop Banks. The revised framework introduce definitions for fraudulent electronic banking transactions, unauthorised transactions, customer negligence, bank negligence, third-party breaches, and shadow reversals. The banks are required to establish transparent customer protection policies, strengthen fraud detection systems, provide mandatory SMS and email transaction alerts, maintain 24×7 fraud reporting channels, and ensure prompt acknowledgement and resolution of complaints. It prescribe zero customer liability where fraud results from bank negligence or timely reported third-party breaches, while defining customer liability in cases involving customer negligence. It also introduce a compensation mechanism for eligible small value fraudulent transactions, prescribe timelines for complaint disposal and transaction reversals, require shadow reversals for credit card fraud complaints, prohibit charges for mandatory regulatory SMS alerts.
(Link: RBI Circular 167/2026 (CB), 168/2026 (SFB), 169/2026 (PB), 170/2026 (LAB), 171/2026 (RRB), 172/2026 (UCB), 173/2026 (RCB) Dated 24/06/2026)
Amendments to RBI NBFC Financial Statements Presentation and Disclosures Directions: RBI has amended the disclosure framework applicable to Non-Banking Financial Companies (NBFCs) following a review of regulations governing Upper Layer NBFCs (NBFC-ULs) under the Scale Based Regulatory Framework. It inserts a proviso after paragraph 23 of the 2025 Directions, exempting NBFC-ULs that are fully owned and controlled by the Government from the specified disclosure requirements.
(Link: RBI Circular 166/2026 Dated 24/06/2026)
Amendments to RBI NBFC Governance Directions: On a review of regulations under the Scale Based Regulatory Framework, the RBI has exempted Upper Layer NBFCs (NBFC-ULs) that are fully owned and controlled by the Government from certain governance provisions contained in paragraph 43 of the 2025 Directions.
(Link: RBI Circular 165/2026 Dated 24/06/2026)
Amendments to RBI Concentration Risk Management Directions: On a review of regulations applicable to Upper Layer NBFCs under the Scale Based Regulatory Framework, the amendments withdraw the blanket exemptions earlier available to Government-owned NBFCs, requiring them to comply with concentration norms applicable to their respective regulatory layer. Existing breaches may continue until maturity without further exposure, while additional exposures beyond prudential limits are permitted only if fully offset through eligible credit risk transfer instruments. The Directions also delete specific Middle Layer provisions, clarify that exposures backed by State Government guarantees will be treated as exposures to the guaranteeing State Government with a 20% risk weight.
(Link: RBI Circular 164/2026 Dated 24/06/2026)
Amendments to RBI NBFC Registration, Exemptions and Framework for Scale Based Regulation Directions: It revises the methodology for identifying Upper Layer NBFCs (NBFC- ULs) under the Scale Based Regulatory Framework. The new framework provides that only NBFCs with an asset size of Rs 1,00,000 crore or above, based on the latest audited financial statements, will constitute the Upper Layer. Several earlier provisions relating to parametric assessment and identification methodology have been removed, while the asset-size threshold will now be reviewed every three years. The amendment also introduces new guidelines for NBFCs that are group entities of Scheduled Commercial Banks, requiring them to comply with applicable banking regulations where similar financial activities are undertaken by both the parent bank and the NBFC, without altering their layer-wise classification.
(Link: RBI Circular 163/2026 Dated 24/06/2026)
Amendments to Prudential Norms on Capital Adequacy Directions: These directions are applicable to Commercial Banks, Small Finance Banks, Local Area Banks, Regional Rural Banks, Urban Coop Banks, Rural Coop Banks, All India Financial Institutions and Standalone Primary Dealers. The amended provisions introduces a detailed methodology for computing the Net Open Position (NOP) and the corresponding capital charge at both standalone and consolidated levels. It specifies exclusions for positions already deducted from regulatory capital, non-performing assets, and eligible structural foreign currency investments, subject to stringent conditions, documentation, consistency, and supervisory review. It also prescribe the treatment of overseas operations, derivatives, gold, forward contracts, and structural forex positions, while providing illustrative examples for calculating eligible exemptions from NOP. Banks are required to maintain risk capital on a continuous, end-of-day basis, with a capital requirement linked with overall Net Open Position.
(Link: RBI Circular 155/2026 (CB), 156/2026 (SFB), 157/2026 (LAB), 158/2026 (RRB), 159/2026 (UCB), 160/2026 (RCB), 161/2026 (AIFI), 162/2026 (SPD) Dated 24/06/2026)
Amendments to RBI Disbursement of Government Pension by Agency Banks (ABs) Directions: The amended directions prohibit banks from recovering excess pension without prior notice, the pensioner knowledge and consent, and compliance with applicable service rules. Banks may obtain a Letter of Undertaking from pensioners to facilitate recovery of future excess payments. Where excess payments arise due to bank attributed errors, banks must immediately credit the amount to the Government account, adopt a recovery policy with a cut-off period, and follow a structured recovery mechanism that prioritizes recovery from surplus account balance, limited pension deductions, or pensioner requested instalments.
(Link: RBI Circular 154/2026 Dated 24/06/2026)
Open positions of Authorised Dealer Category-I Banks: RBI has partially modified its earlier directions on the Net Overnight Open Position (NOP-INR) framework applicable to Authorised Dealer Category-I (AD Cat-I) banks. As per revised norms, banks are permitted to exclude positions arising from hedged transactions relating to FCNR (B) deposits, External Commercial Borrowings (ECBs), and Overseas Foreign Currency Borrowings (OFCBs) while computing their net overnight open position. The relaxation applies only to transactions covered under RBI swap facilities introduced in June 2026.
(Link: RBI Circular 153/2026 Dated 23/06/2026)
Amendments to RBI Commercial Banks Credit Facilities Directions: These Directions are applicable to Commercial Banks and Small Finance banks. The directions permit banks to offer pre-sanctioned credit lines through the Unified Payments Interface (UPI) with customer consent. The new provisions clarify that the prudential treatment of any credit facility, including pre-sanctioned UPI credit lines, will be determined solely by the nature of the underlying credit facility, irrespective of the payment channel, instrument, or technology used. Banks must incorporate the terms and conditions of such payment linked credit facilities into their credit policies and ensure compliance with all applicable regulations.
(Link: RBI Circular 151/2026 (SFB), 152/2026 (CB) Dated 23/06/2026)
Draft RBI Call, Notice and Term Money Markets Master Directions 2026: An active-term money market, apart from providing an alternative funding avenue to the market participants, also helps in enhancing monetary policy transmission by creating a link between the overnight money market and longer-term interest rates. The draft Directions aim to further enhance the depth of participation and liquidity in the term money market segment by enhancing the borrowing limits for standalone primary dealers and expanding the participant base.
(Link: Draft RBI Master Directions Dated 25/06/2026)
Draft RBI Secondary Market Transactions in Government Securities Master Directions: Secondary market transactions in Government securities are undertaken in accordance with the instructions issued from time to time. With an objective to enhance clarity, streamline compliance, and provide a single point of reference to all stakeholders, the draft Directions consolidate extant instructions for undertaking secondary market transactions in Government securities.
(Link: Draft RBI Master Directions Dated 25/06/2026)
Draft Guidance on Regulatory Principles for Model Risk Management: RBI had earlier issued the draft Regulatory Principles for Management of Model Risks in Credit, with a view to strengthen governance and risk management practices relating to use of models in credit. Considering that model usage has expanded significantly and regulated entities are increasingly using models, including those employing Artificial Intelligence / Machine Learning (AI / ML), across various business and decision-making processes, weaknesses in their governance, oversight, risk management and controls may expose the regulated entities to financial, operational, compliance, and reputational risks. The guidelines provides holistic and broad regulatory expectations for model risk management across the model lifecycle. The Guidance is applicable to all models used by regulated entities, including third party models and models employing AI / ML.
(Link: Draft RBI Guidelines Dated 24/06/2026)
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Compiled by: CMA Yash Paul Bhola, MBA, FCMA, Former Director (Finance), National Fertilizers Limited.
Disclaimer: The contents of this article are for informational purposes only. The user may refer to the relevant notification/ circular/ decisions issued by the respective authorities for specific interpretation and compliances related to a particular subject matter)
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