Summary: The week from 31 August to 6 September 2026 saw important judicial, regulatory and compliance developments across Income Tax, GST, Central Excise, Customs, DGFT, SEBI, MCA, IBBI and RBI. Key developments included TDS credit to an employee despite the employer’s tax non-deposit, GST liability on highway annuity under DBFOT works contracts, and denial of ITC where the supplier failed to pay tax. Central Excise revised RIC and SAED rates on petroleum exports, while Customs issued measures on SCMTR, tariff values, the NAC Portal and import documentation. DGFT extended the SION E-52 conversion deadline, introduced allocation procedures for the balance Raw Sugar TRQ and automated FSC issuance. SEBI proposed net settlement for eligible mutual fund cash-market transactions, MCA extended CCFS-2026 to 15 September 2026, and IBBI developments covered IBC limitation, extinguishment of pre-CIRP shares, valuation challenges and disciplinary action. RBI amended reporting and investment-portfolio requirements, while the Supreme Court referred arbitration pre-deposit issues to a larger Bench.
(Income Tax, GST, Central Excise, Custom Duty, DGFT, SEBI, MCA, IBBI, RBI)
(Click the Link for Notification/ Circular as issued)
A. Income Tax
HC, Allows TDS Credit to Employee despite Kingfisher Airlines Non-Deposit: Case of Yatish Saxena Vs ACIT, HC Delhi, Judgement Dated 21st August 2026. The tax department raised demands because Kingfisher Airlines (the petitioner’s former employer) deducted Tax Deducted at Source (TDS) from the employee’s salary but failed to deposit it with the government. HC held that an employee cannot be penalized or denied TDS credit for the employer failure to deposit the deducted tax amounts.
(Link: HC Delhi Judgement Dated 21/08/2026)
B. GST
HC, GST applies to Highway Annuity as Works Contract: Case of Nagaur Mukundgarh Highways Pvt Ltd Vs CBIC, HC Rajasthan, Judgement Dated 17th August 2026. HC held that designing, building, & maintaining highways under a DBFOT (Design, Build, Finance, Operate, Transfer) model constitutes a works contract under Heading 9954, making it fully taxable. It held that deferred annuity payments received for road construction under concession agreements are taxable under GST as works contract services.
(Link: HC Rajasthan Judgement Dated 17/08/2026)
HC, Non-Payment of Tax by Supplier, bars Buyer ITC: Case of Shree Karni Electrovision Vs Union of India, HC Rajasthan, Judgement Dated 17th August 2026.
The court held that actual payment of tax by a supplier is a mandatory condition for claiming Input Tax Credit (ITC) under Section 16(2)(c) of the CGST Act. It ruled that buyers claim ITC at their own risk and the department can recover wrongly availed credit if the tax remains unpaid by the supplier.
(Link: HC Rajasthan Judgement Dated 17/08/2026)
C. Central Excise
Road and Infrastructure Cess revised on Export of Diesel to Rs 1.00 per Litre: The notification amends earlier notification 11/2026 dated 26th March 2026, to revise Road and Infrastructure Cess (RIC) applicable on export of Diesel. The RIC rate has been substituted with Rs 1.00 per litre (Pre-revised Rs NIL per litre), effective from 1st September 2026.
(Link: Central Excise Notification 48/2026 (T) dated 01/09/2026)
SAED revised on Export of ATF to Rs 19.00 per Litre: The notification amends earlier notification 08/2026 dated 26th March 2026, to revise the Special Additional Excise Duty (SAED) applicable on export of Aviation Turbine Fuel (ATF). The SAED rate has been substituted with Rs 19.00 per litre (Pre-revised Rs 19.50 per litre), effective from 1st September 2026.
(Link: Central Excise Notification 47/2026 (T) dated 01/09/2026)
SAED revised on Export of Petrol to Rs 1.50: The notification amends earlier notification 06/2026 dated 26th March 2026, to revise the Special Additional Excise Duty (SAED) applicable on export of Petrol to Rs 1.50 (Pre-revised Rs NIL per litre) effective from 1st September 2026.
(Link: Central Excise Notification 46/2026 (T) dated 01/09/2026)
D. Custom Duty
CBIC appoints Common Adjudicating Authority for Akwel Automative Customs SCNs: The Assistant/Deputy Commissioner of Customs, Group-II (H-K), NS-I, JNCH, Nhava Sheva has been appointed as common adjudicating authority for various specified show cause notices issued to M/s Akwel Automotive Pune India Pvt Ltd, so as to consolidates the adjudication proceedings under a single authority to streamline the legal/customs clearance process.
(Link: Customs Notification 74/2026 (NT) Dated 01/09/2026)
Extension of Sea Cargo Manifest Compliance deadline to 31st October 2026: The circular extends the compliance date to 31st October 2026. These regulations are being made operational starting 1st September 2026, in a phased manner across ports.
(Link: Customs Notification 73/2026 (NT) Dated 01/09/2026)
Fixation of Tariff Value of Edible Oils, Brass Scrap, Areca Nut, Gold and Silver: CBDT notified the Tariff Values of Edible Oils, Brass Scrap, Areca Nut, Gold and Silver, which shall come into force w.e.f. 1st September 2026. The tariff value for crude palm oil is set at USD 1214 per metric ton, while gold and silver have tariff values of USD 1468 per 10 grams and USD 2267 per kilogram, respectively. The tariff value for areca nuts is fixed at USD 11574 per metric ton.
(Link: Customs Notification 72/2026 (NT) Dated 31/08/2026)
NAC Portal for Trade and Department for Effective Dissemination of Information: CBIC has launched National Assessment Centre (NAC) Portal for Customs Assessment Information. The common digital platform is intended to promote uniformity, certainty and transparency in Customs assessments. It provides access to NAC decisions, legal precedents, CAAR rulings, advisories, audit observations and information relating to classification, valuation and other assessment matters. NACs have been directed to regularly update the Portal and prioritise information concerning commodities taken up by stakeholders during CCFC/PTFC for guidance or uniformity in assessment.
(Link: Customs Circular 41/2026 Dated 03/09/2026)
Import Compliance Checklists for Drugs, Cosmetics & Medical Devices: The circular prescribes mandatory compliance checklists for the import and clearance of cosmetics, drugs, and medical devices, to be verified by customs officers before granting an Out-of-Charge (OOC) order for PGA (Participating Government Agency) facilitated Bills of Entry. It includes verification of Self-certified copies of import permissions, reconciliation of invoice details, item names, and quantities with the official import license or permission.
(Link: Customs Circular 40/2026 Dated 03/09/2026)
Rationalization of documentation requirements under Eligible Manufacturer Importer (EMI) Scheme: The circular significantly rationalize and simplify the documentation requirements under the Scheme. Mandatory document uploads have been reduced from 10 down to just 3, leveraging backend IT verification. Extensive disclosures related to GST, financial records, premises, and past import documents are no longer mandatory. Data elements required in Appendix-I have also been trimmed down.
(Link: Customs Circular 39/2026 Dated 03/09/2026)
Implementation of the Sea Cargo Manifest and Transhipment Regulations (SCMTR): The circular directs the phased implementation of the Sea Cargo Manifest and Transhipment Regulations 2018, across all Indian ports. It applies to authorized sea carriers, shipping agents, terminal operators, transhippers, and custodians (such as CFSs and ICDs). Full implementation to occur port-wise from 1st September 2026, through 15th October 2026.
(Link: Customs Circular 38/2026 Dated 01/09/2026)
E. Directorate General of Foreign Trade (DGFT)
Extension of SION E-52 Advance Authorisation to Raw Sugar TRQ Conversion Deadline: The public notice extends of the timeline for the one-time conversion of Advance Authorisation under SION E-52 to the Tariff Rate Quota (TRQ) for the import of raw sugar. The last date for submission of such applications shall be 7th September 2026.
(Link: DGFT Public Notice 29/2026 Dated 03/09/2026)
DGFT Opens daily allocation of 2,02,550 MT balance Raw Sugar TRQ: The public notice lays out the procedures and rules for allocating the remaining 2,02,550 MT of Raw Sugar under the Tariff Rate Quota (TRQ) Scheme under a dynamic daily batch system. Every day, all electronic applications submitted up to 5:30 PM are grouped into a single batch. These are collectively scrutinised and processed on the next working day.
(Link: DGFT Public Notice 28/2026 Dated 01/09/2026)
Automated Issuance of Free Sale and Commerce Certificates (FSC): The trade notice introduces the Automated Issuance of Free Sale and Commerce Certificates (FSC) via the official DGFT portal. Under the new mechanism, eligible applications that clear pre-set system validation parameters will be generated instantly and automatically, bypassing traditional routing to Regional Authorities (RAs) for manual evaluation.
(Link: DGFT Trade Notice 24/2026 Dated 31/8/2026)
F. Securities and Exchange Board of India (SEBI)
Consultation Paper on Permitting net settlement of funds for transactions undertaken by MF Schemes in Cash Market: The proposal allows mutual fund schemes to settle eligible cash-market purchase and sale transactions on a net funds basis, rather than always requiring gross funding for both legs. The proposal is intended to reduce temporary liquidity pressure and improve operational efficiency while preserving safeguards around scheme-level accounting, delivery and investor protection. The fund houses can net obligations for such transactions at the scheme level during a settlement cycle, but no netting will be allowed across schemes. The suggestions/ comments from stakeholders are invited.
(Link: SEBI Consultation Paper Dated 03/09/2026)
G. Ministry of Corporate Affairs (MCA)
Extension of CCFS-2026 Compliance Scheme Deadline: MCA has extended the deadline for the Companies Compliance Facilitation Scheme (CCFS-2026) to 15th September 2026. CCFS-2026 allows companies to regularise pending annual filings forms by paying only 10% of the applicable additional fee, a substantial waiver on the normal additional filing fee. Companies can also use this window to apply for dormant status by paying half of normal fees or initiate voluntary strike-off by paying 25% of filing fees, where applicable.
(Link: MCA General Circular 04/2026 Dated 31/08/2026)
H. Insolvency and Bankruptcy Board of India (IBBI)
SC, Subsisting EPC Contract cannot extend IBC Limitation Period: Case of Srinivasa Reddy Velagala Vs Sravanthi Infratech Pvt Ltd, SC Judgement Dated 12th August 2026. The apex court quashed the insolvency proceedings against the appellant. However, the Court granted the operational creditor the liberty to pursue its monetary claims before an appropriate dispute resolution/arbitration forum as stipulated in the original EPC contract. The ruling reinforces that the IBC is a resolution mechanism, not a debt recovery tool. It sets a strict precedent that composite contractual claims must be split, each invoice marks an independent default date, and creditors cannot bypass limitation laws simply because a master contract remains active.
(Link: SC Judgement Dated 12/08/2026)
NCLAT, Upholds Extinguishment of Pre-CIRP Shares under Approved Resolution Plan: Case of Titus Babu Vs Sintex Industries Limited, NCLAT Delhi Judgement Dated 21st August 2026. The appellate tribunal ruled that an approved resolution plan extinguishes pre-CIRP shareholding and cannot be reopened. It clarified that “member” and “shareholder” are legally identical under Section 2(55) of the Companies Act for a company limited by shares. No independent membership rights survive after share extinguishment under a resolution plan.
(Link: NCLAT Delhi Judgement Dated 21/08/2026)
NCLAT, Belated Revaluation Challenge cannot reopen Approved CIRP: Case of Santosh R. Shetty Vs Raja Deshraj Agarwal, NCLAT Delhi Judgement Dated 14th July 2026. The appellate tribunal ruled that a valuation approved by the Committee of Creditors (CoC) cannot be reopened or litigated at a belated stage by a suspended director or promoter. It makes it clear to corporate debtors that once a resolution plan passes the scrutiny of the CoC following proper statutory valuation routines, it becomes final and binding. Late-stage legal actions by erstwhile owners to dispute valuations or re-negotiate are firmly barred.
(Link: NCLAT Delhi Judgement Dated 14/07/2026)
IBBI, Insolvency Professional Sh. Kannan Tiruvengadam suspended over Private Sale Contraventions: The Disciplinary Committee (DC) found that the IP has executed a private sale of assets without mandatory approval from the Stakeholders’ Consultation Committee (SCC), during his tenure as the RP and Liquidator for BRG Iron & Steel Co Private Limited. It suspended his registration for a period of two years.
Link: IBBI DC Order Dated 03/09/2026
I. Reserve Bank of India (RBI)
Reporting Requirements for Non-Resident Bank Rupee Accounts Dispensed: RBI has dispensed with two reporting requirements applicable to Authorised Dealer Category-I (AD Category-I) banks in relation to accounts of non-resident banks. Earlier, AD banks were required to furnish an up-to-date list of all their offices/branches maintaining Rupee accounts of non-resident banks as at the end of December each year. It also required reporting of temporary overdrawals by overseas branches/correspondents exceeding the permissible limit where such excess was not adjusted within five days.
(Link: RBI Circular 251/2026 Dated 02/09/2026)
Half-Yearly CIMS Return introduced for Natural Calamity Relief Measures: The amended directions require REs to submit data relating to relief measures extended in areas affected by natural calamities through the CIMS portal on a half-yearly basis. The return shall be submitted within 30 days from the end of each half-year. the existing monthly return on relief measures stands discontinued.
(Link: RBI Circular 250/2026 Dated 02/09/2026)
Amendments to RBI UCB Classification, Valuation and Operation of investment Portfolio Directions: The amendment enables Urban Co-operative Banks (UCBs) to acquire membership of Indian Digital Payment Intelligence Corporation (IDPIC), which has been established as the nation’s central digital payment fraud intelligence platform. permit equity shares of the Umbrella Organization (UO) of the UCB sector and IDPIC for acquiring membership.
(Link: RBI Circular 249/2026 Dated 02/09/2026)
J. Miscellaneous
SC, Refers Arbitration Pre-Deposit Validity Questions to Larger Bench: Case of Santosh Associate Private Limited v. Haryana State Industrial and Infrastructure Development Corporation Ltd, SC Judgement Dated 17th August 2026.
The HSIIDC awarded a drainage work contract in Gurugram to the appellant, which later faced disputes over reduced scope and final settlement. The sole arbitrator directed the appellant to deposit 10% of the claim amount under a contract term, and dismissed the claim entirely when the amount was not paid. The apex court questioned the validity of mandatory pre-deposit clauses as a precondition to invoking arbitration and referred matter to a larger bench.
(Link: SC Judgement Dated 17/08/2026)
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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)
