Compiled by: CMA Yash Paul Bhola, MBA, FCMA, Former Director (Finance), National Fertilizers Limited, with extensive experience in corporate finance, regulation, and public sector governance.
The compilation summarises key notifications, circulars, and judicial developments issued during 5–11 January 2026 across income tax, GST, customs, foreign trade, securities, insolvency, banking, labour laws, and allied regulatory areas. On the tax front, multiple authorities and funds were notified for income-tax exemptions, while courts clarified issues such as absence of permanent establishment in outsourcing arrangements and strict penalties for wilful GST non-filing. GST rulings addressed input tax credit eligibility, exemption for pure services to government bodies, healthcare services, and classification disputes. Customs updates extended anti-dumping duties and clarified tariff classification principles. Financial sector regulators issued wide-ranging reforms covering stock broker regulations, investor accreditation, risk management, credit exposure norms, capital adequacy, disclosures, dividend policies, and cheque clearing systems. Insolvency jurisprudence refined principles on default, third-party rights, financial debt, and professional accountability. Labour law draft rules under the four labour codes were also released. Overall, the week reflects heightened regulatory tightening, procedural clarity and judicial emphasis on compliance, proportionality and fairness.
Notifications & Circulars issued during week (5th – 11th Jan 2026)
(Income Tax, GST, Central Excise, Custom Duty, DGFT, SEBI, MCA, IBBI, RBI)
(Click the Link for Notification/ Circular as issued)
A. Income Tax
Inbar Holding RSC Limited notified as the specified person for exemptions under section 10(23FE): The pension fund, namely, Inbar Holding RSC Limited has been notified as the specified person for exemptions under section 10(23FE) in respect of the eligible investment made by it in India on or after the date of publication of this notification in the Official Gazette but on or before the 31st March, 2030. It also prescribe the conditions and compliances for eligibility of tax exemption under said clause.
(Link:Income Tax Notification 01/2026 Dated 05/01/2026)
Exemptions to Joint Electricity Regulatory Commission: Joint Electricity Regulatory Commission (for The State of Goa and Union Territories except Delhi), an authority constituted under the Electricity Act 2003, has been notified under section 10(46A) for exemption on its income, provided the authority continues to operate for specified purpose under section 10(46A)(a) of Act.
(Link:Income Tax Notification 02/2026 Dated 06/01/2026)
Exemptions to Mussoorie Dehradun Development Authority: Mussoorie Dehradun Development Authority, an authority constituted under the Uttar Pradesh Urban Planning Development Act 1973 and as regulated under the Uttarakhand Urban and Country Planning Development (Amendment) Act 2013, has been notified under section 10(46A) for exemption on its income, provided the authority continues to operate for specified purpose under section 10(46A)(a) of Act.
(Link: Income Tax Notification 03/2026 Dated 06/01/2026)
Exemptions to Kota Development Authority: Kota Development Authority, an authority constituted under the Kota Development Authority Act 2023, has been notified under section 10(46A) for exemption on its income, provided the authority continues to operate for specified purpose under section 10(46A)(a) of Act.
(Link: Income Tax Notification 04/2026 Dated 06/01/2026)
Exemptions to Gorakhpur Industrial Development Authority: Gorakhpur Industrial Development Authority, an authority constituted under the Uttar Pradesh Industrial Area Development Act 1976, has been notified under section 10(46A) for exemption on its income, provided the authority continues to operate for specified purpose under section 10(46A)(a) of Act.
(Link: Income Tax Notification 05/2026 Dated 06/01/2026)
Exemptions notified for Core Settlement Guarantee Fund under section 10(23EE): The Core Settlement Guarantee Fund has been notified for exemption under Section 10(23EE) of the Income Tax Act. The Fund has been set up by AMC Repo Clearing Limited, a recognised clearing corporation, in respect of specified income. The benefit is subject to continued compliance with statutory conditions, including filing of return of income under Section 139(4C) and the requirement that AMC Repo Clearing Limited must remain recognised as a clearing corporation by Securities and Exchange Board of India.
(Link:Income Tax Notification 06/2026 Dated 08/01/2026)
HC, Outsourcing solutions to Indian subsidiary doesn’t result in creation of PE: Case of CIT (International) vs EXL Service.Com, HC Delhi Judgement Dated 17th December 2025. HC held that outsourcing solutions including transaction processing services and Internet/voice-based customer care services for its clients to subsidiary in India does not result in creation of Permanent Establishment (PE) in India under India-USA DTAA.
(Link: HC Delhi Judgement Dated 17/12/2025)
B. GST
GSTN Advisory on Filing Opt-In Declaration for Specified Premises: The GSTN advisory informs that opt-in declarations for declaring hotel accommodation premises as ‘specified premises’, under notification 05/2025 (Rate), are now available online on the GST Portal. Declarations are submitted via EVC, allow up to 10 premises per filing, generate premise-wise reference numbers, and remain valid for subsequent years unless opted out. It also requires re-filing electronically for FY 2026–27 where FY 2025–26 declarations were earlier submitted manually.
(Link:GSTN Advisory Dated 29/12/2025)
AAR Allows ITC on Repairs, Refurbishment, Common Expenses and Capital Goods for Second-Hand Vehicle Dealers: Case of Goexotic Plus91 Motors Private Limited, AAR Kerala Ruling Dated 11th December 2025. The applicant is in the business of buying and selling second-hand motor vehicles and deals mainly in used luxury cars procured from both registered and unregistered persons. Small processing activities such as repair, refitting and replacement of spare parts are done to enhance the resale value of the vehicles, without changing their essential character before resale. The Authority held that Notification 8/2018 (Rate) restricts the availment of input tax credit only in respect of the purchase of old or used motor vehicles on which the benefit of margin-based taxation is claimed. The restriction does not extend to other inward supplies such as spare parts, repairs, refurbishment services, rent, advertising, professional services or capital goods used in the course or furtherance of business.
(Link: AAR Kerala Ruling Dated 11/12/2025)
AAR, GST Not Applicable on Centage Charges Collected for PMC Services to Government Bodies: Case of Steel Industrials Kerala Ltd, AAR Kerala Ruling Dated 8th December 2025. AAR noted that as per Entry 3 of Notification 12/2017(Rate) dated 28th June 2017, exemption is available where the supply qualifies as pure services, is rendered to Government or local authorities, and relates to functions entrusted under Articles 243G or 243W of the Constitution. The applicant’s PMC services involved no supply of goods and were provided to Government departments and Panchayats in connection with constitutionally assigned functions. Thus, AAR ruled that GST is not applicable on centage charges collected for such pure PMC services and the same are exempt under the said notification.
(Link: AAR Kerala Ruling Dated 08/12/2025)
AAR, No GST on Dermatological or Skin Clinic Treatment: Case of Advanced Hair Restoration India Private Limited, AAR Kerala Ruling Dated 24th November 2025. It was observed that the ailments treated by the applicant are recognised medical conditions requiring professional diagnosis and therapeutic care and are not cosmetic or aesthetic in nature. AAR held that services relating to health care, including those offered because of psoriasis, dandruff, dermatitis, anti-fungal infections, folliculitis, and other similar dermatological conditions, are exempt from GST under Serial 74 of Notification 12/2017 (Rate), dated 28th June 2017.
(Link: AAR Kerala Ruling Dated 24/11/2025)
AAR, Medicated Toilet Soap kept outside 5% GST Slab due to Distinct Therapeutic Use: Case of East African (India) Overseas, AAR Uttarakhand Ruling Dated 6th January 2026. AAR ruled that medicated toilet soap manufactured by the applicant is classifiable under tariff item 34011110 and continues to attract GST at 18%. The concessional 5% rate introduced by Notification No. 9/2025 (Rate) applies only to non-medicated toilet soaps and does not extend to medicated variants.
(Link: AAR Uttarakhand Ruling Dated 06/01/2026)
SC Upholds GST Penalty for Wilful Non-Filing of Monthly Returns: Case of Sriba Nirman Company vs Commissioner (Appeals), SC Judgement Dated 18th November 2025. The apex court upheld a 100% GST penalty for wilful suppression of facts, establishing that failing to file monthly GST returns (GSTR-3B) and pay tax, despite raising invoices, constitutes wilful suppression, even if tax is later paid.
(Link: SC Judgement Dated 18/11/2025)
C. Central Excise
No Notification/ Circular during the week.
D. Custom Duty
Anti-Dumping Duty extended on ‘Flexible Slab stock Polyol of molecular weight 3000-4000’ imported from Saudi Arabia and UAE: The notification amends earlier notification 20/2021 (ADD) dated 5th April 2021, and extends the validity of the existing anti-dumping duty on imports of ‘Flexible Slab stock Polyol of molecular weight 3000-4000’ rom Saudi Arabia and UAE till 17th June 2026. It aims to ensure that the duty remains operative during sunset review proceedings.
(Link: Customs Notification 01/2026 (ADD) Dated 02/01/2026)
Anti-Dumping Duty extended on Normal Butanol Imports from European Union, Malaysia, Singapore, South Africa, and USA: The notification amends earlier notification 21/2021 (ADD) dated 12th April 2021, and extends the validity of the existing anti-dumping duty on imports of ‘Normal Butanol or N-Butyl Alcohol’, originating in or exported from the European Union, Malaysia, Singapore, South Africa, and the United States of America till 12th July 2026. It aims to ensure that the duty remains operative during sunset review proceedings.
(Link: Customs Notification 02/2026 (ADD) Dated 08/01/2026)
SC, Aluminium Shelves classifiable as Structures because they lack Mechanical Function: Case of Commissioner of Customs (Import) vs Welkin Foods, SC Judgement Dated 6th January 2026. The apex court ruled that ‘Aluminium Shelves/Racks’ used for mushroom cultivation must be classified as ‘Aluminium Structures’ (attracting 10% duty) rather than ‘Parts of Agricultural Machinery’ (attracting Nil duty).
(Link: SC Judgement Dated 06/01/2026)
E. Directorate General of Foreign Trade (DGFT)
DFGT amends e-BRC Format to add GST Details: The Public Notice amends Appendix 2U of the Handbook of Procedures, relating to the issuance of the Electronic Bank Realisation Certificate (e-BRC). The amendment introduces three new mandatory fields, i.e. GSTIN, GST Invoice Number, and GST Invoice Date, and modifies existing field structures to align address details with GST identification requirements.
(Link: DGFT Public Notice 42/2026 Dated 09/01/2026)
Enlistment under Appendix 2E of FTP, Agency Authorised to issue Certificate of Origin (Non-Preferential): The Public Notice enlist India & Arab Countries Chamber of Commerce, Industry & Agriculture under Appendix 2E of the FTP 2023. It is now authorised to issue non-preferential Certificates of Origin, which are required for certifying the country of origin of exported goods.
(Link: DGFT Public Notice 43/2026 Dated 09/01/2026)
F. Securities and Exchange Board of India (SEBI)
SEBI Stock Brokers Regulations 2026: The regulations consolidate rules on registration, eligibility, net worth, deposits, fees, and operational permissions across market segments, while clarifying when separate registrations are not required. It impose comprehensive general and enhanced obligations, including client fund and securities protection, robust risk management, cybersecurity resilience, grievance redressal, record-keeping for eight years, and strict codes of conduct. It introduces institutional mechanisms to prevent, detect, and report fraud or market abuse, including surveillance systems, mule-account detection, whistle-blower protections, and periodic reporting. It enables regulatory sandbox relaxations to foster innovation and also specifies underwriting permissions.
(Link: SEBI Notification Dated 07/01/2026)
Distributor Incentive Rollout deferred due to Operational Challenges: SEBI had prescribed a framework, through a circular dated 27th November 2025, to incentivize distributors for mobilizing investments from two specific categories, i.e. new individual investors from B-30 cities and new women individual investors from both T-30 and B-30 cities. The revised effective date has been extended to 1st March 2026.
(Link: SEBI Circular Dated 07/01/2026)
Compliance reporting formats for Specialized Investment Funds (SIF): The circular standardize compliance reporting formats for Specialized Investment Funds (SIFs) to ensure uniformity and clarity. It mandates modifications to two key reports, i.e. the Compliance Test Report (CTR) and the Half-Yearly Trustee Report (HYTR). The CTR format is amended to include an additional Part IV covering detailed compliance checks specific to SIF regulations, investment restrictions, disclosures, risk bands, and operational norms. The HYTR format is also expanded by inserting Clause 72A, requiring trustees to certify compliance with governance, risk management, fees, disclosures, and investor protection requirements for SIFs.
(Link: SEBI Circular Dated 08/01/2026)
Simplification of requirements for grant of accreditation to Investors in AIFs: The revised norms of accreditation framework, allow Alternative Investment Fund (AIF) managers, pending receipt of an accreditation certificate, to execute contribution agreements and initiate operational processes based on their assessment of investor eligibility, subject to safeguards. Investor commitments made during this interim period cannot be counted towards the scheme’s corpus, and funds can be accepted only after accreditation is formally granted. SEBI has also eased net worth documentation requirements by removing the mandatory submission of a detailed net worth break-up annexed to the certificate. The circular further requires trustees, sponsors, or managers to ensure compliance with these provisions in the Compliance Test Report.
(Link: SEBI Circular Dated 09/01/2026)
Review of Framework to address the ‘technical glitches’ in Stock Brokers Electronic Trading Systems: The revised framework exclude smaller brokers, exempt glitches outside brokers’ trading architecture or with negligible trading impact, and simplify reporting through extended timelines and a common reporting platform. Reporting time for glitches has been increased to two hours, and brokers must submit preliminary and root cause analysis reports within specified timelines. It rationalises technology requirements such as capacity planning, software testing, disaster recovery, and business continuity based on broker size and technology dependency. Financial disincentives have also been rationalised, excluding minor glitches or those affecting only one trading mode.
(Link:SEBI Circular Dated 09/01/2026)
Consultation Paper on Norms for sharing and usage of price data for educational purposes: Currently, circular dated May 2024 permits sharing of price data for education with a one-day lag, while the circular dated January 2025 restricts entities engaged solely in education to using price data that is at least three months old. The consultation paper explains that live or near-live data usage goes beyond education and may amount to investment advisory or research activity. To balance misuse prevention and educational relevance, the paper proposes a uniform time lag of 30 days for both sharing and usage of price data for educational purposes.
(Link: SEBI Consultation Paper Dated 06/01/2025)
Consultation Paper on Circular for Trading at Stock Exchanges: The proposals ai at simplification of regulatory requirements, consolidation of circulars and improved clarity. The key proposals include consolidation of bulk and block deal disclosure requirements, enhanced clarity on client-level disclosures, tabulation of market wide circuit breaker triggers, rationalisation of trading halt and resumption provisions, and consolidation of dynamic price band norms to eliminate duplication.
(Link: SEBI Consultation Paper Dated 09/01/2025)
G. Ministry of Corporate Affairs (MCA)
No Notification/ Circular during the week.
H. Insolvency and Bankruptcy Board of India (IBBI)
Launch of Revised Forms for the Liquidation Process: The revision follows amendments to the Liquidation Process Regulations vide notification dated 2nd January 2026 and aims to reduce compliance burden by eliminating duplication, rationalising data fields, and enabling auto-population of information already available on the IBBI portal. Four revised forms i.e. LIQ-1 to LIQ-4 now cover the entire liquidation lifecycle, from commencement and public announcement to dissolution or closure, each with clearly defined timelines.
(Link:IBBI Circular Dated 05/01/2026)
SC, Resolution Plan does not extinguish third-party rights unless Debt Paid: Case of UV Asset Reconstruction Company Ltd vs Electrosteel Castings Limited, SC Judgement Dated 6th January 2026. The apex court held that Clause 2.2 of the Deed of Undertaking did not constitute a guarantee under Section 126 of the Indian Contract Act, as it only obliged ECL to arrange funds for compliance with financial covenants, not to discharge ESL’s debt. It also ruled that approval of ESL’s resolution plan did not extinguish debt against third-party security providers like ECL, as the plan explicitly preserved creditors rights against them.
(Link:SC Judgement Dated 06/01/2026)
NCLAT, CIRP by Financial Creditors (Sec-7) application admitted because Grace Period did not Defer Default: Case of Kewal Krishan Sharma vs Navneet Gupta, NCLAT Delhi Judgement Dated 6th November 2025. After examining the contractual documents and payment records, the appellate tribunal held that the event of default occurred automatically on 16th March 2020 under Clause 6 of the MoU, when the corporate debtor failed to clear the January 2020 dues within the 45-day grace period. The bench held that contractual grace period did not postpone the ‘occurrence’ of default, it merely gave the debtor additional time to rectify it before triggering the contractual consequences. Section 10A protects defaults of covid period, occurring between March 25, 2020, and March 24, 2021. The bench held that the default was complete and continuing before the Section 10A suspension period, and ruled that the insolvency proceedings were validly initiated.
(Link:NCLAT Delhi Judgement Dated 06/11/2025)
NCLAT, Contribution to assets of corporate debtor upheld as business of Corporate Debtor carried to Defraud Creditors: Case of Swapan Kumar Saha vs Ashok Kumar Agarwal, NCLAT Delhi Judgement Dated 6th November 2025. The appellate tribunal upholds order of NCLT directing contribution to the assets of corporate debtor since it is clearly established that business of corporate debtor was carried on with intent to defraud creditors of corporate debtor.
(Link: NCLAT Delhi Judgement Dated 06/11/2025)
NCLAT, Advance to Corporate Debtor for sharing profit in real estate project does not qualify as Financial Debt: Case of Meck Pharmaceuticals and Chemicals Pvt Ltd vs Accurate Infrabuild Pvt Ltd, NCLAT Delhi Judgement Dated 29th October 2025. The appellate tribunal held that amount advance to Corporate Debtor with view to share profit in real estate project does not qualify as financial debt under section 5(8) of the Insolvency and Bankruptcy Code.
(Link:NCLAT Delhi Judgement Dated 29/10/2025)
NCLAT, Balance sheet entries are reliable evidence of existence of Financial Debt: Case of Subhash Chander Chauhan vs Kaliber Associates Pvt Ltd, NCLAT Delhi Judgement Dated 17th October 2025. The appellate tribunal held that balance sheet entries are reliable evidence of existence of financial debt. Accordingly, since debt and default against Corporate Debtor established, admission of application for CIRP by Financial Creditors under section 7 of IBC justified.
(Link: NCLAT Delhi Judgement Dated 17/10/2025)
NCLAT, Resolution profession required to repossess shares held in any subsidiaries of Corporate Debtor: Case of Rupinder Singh Gill vs Three C universal Developers Pvt Ltd, NCLAT Delhi Judgement Dated 4th September 2025. The appellate tribunal held that Resolution Professional is required to take control and custody of any assets for which the Corporate Debtor has ownership right including the assets that may or may not be in possession of the Corporate Debtor. Thus, section 18(1) of IBC enables resolution profession to repossess shares held in any subsidiaries of Corporate Debtor.
(Link: NCLAT Delhi Judgement Dated 04/09/2025)
IBBI, Registration of IP Girish Krishna Hingorani, cancelled for filing Personal Insolvency without Guarantee Deed: The Disciplinary Committee (DC) held that an application under Section 94 of the IBC was filed without conducting basic due diligence, as no personal guarantee deed existed or was annexed, despite this being a mandatory requirement. The application was filed just days before scheduled possession of secured assets under SARFAESI proceedings, resulting in an interim moratorium that stalled recovery. The DC cancelled his registration.
(Link: IBBI Order Dated 08/01/2026)
I. Reserve Bank of India (RBI)
Foreign Exchange Management (Guarantees) Regulations 2026: These regulations supersede the 2000 regulations to regulate guarantees involving residents and non-residents. These prohibit persons resident in India from being parties to guarantees involving non-residents except as permitted, while specifying exemptions for guarantees by overseas or IFSC branches of authorised dealer banks, certain irrevocable payment commitments, and guarantees issued under overseas investment regulations. Residents may act as surety or principal debtor subject to conditions that the underlying transaction is permitted and borrowing and lending eligibility norms are met, with defined exceptions. Residents may also obtain guarantees as creditors, subject to safeguards where both debtor and surety are non-residents. It requires quarterly reporting obligations through a prescribed form and assigns reporting responsibility based on party roles.
(Link: RBI FEMA Notification Dated 06/01/2026)
Amendments to RBI Credit Risk Management Directions: The amendments significantly expand and standardise definitions of related persons, related parties, control, promoters, KMPs, specified employees, reciprocally related persons aligning them with the Companies Act and IBC. Banks must adopt comprehensive Board approved credit risk policies with explicit safeguards for related-party lending, including aggregate and sub-limits, materiality thresholds linked to asset size, and mandatory Board or committee approval for material exposures. The directions impose strict prohibitions and conditions on lending to promoters, significant shareholders, directors, and connected entities, require recusal of interested persons, and mandate robust monitoring, whistleblowing, audit reviews, and reporting.
(Link: For Commercial Banks RBI Circular 173/2026 Dated 05/01/2026)
(Link: For Small Finance Banks RBI Circular 174/2026 Dated 05/01/2026)
(Link:For Local Area Banks RBI Circular 175/2026 Dated 05/01/2026)
(Link: For Regional Rural Banks RBI Circular 176/2026 Dated 05/01/2026)
(Link: For Urban Cooperative Banks RBI Circular 177/2026 Dated 05/01/2026)
(Link: For Rural Cooperative Banks RBI Circular 178/2026 Dated 05/01/2026)
(Link:For Non-Banking Financial Companies RBI Circular 179/2026 Dated 05/01/2026)
(Link: For All India Financial Institutions RBI Circular 180/2026 Dated 05/01/2026)
Amendments to RBI Financial Statements: Presentation and Disclosures Directions: The amendments strengthen transparency around related party exposures in banks’ financial statements. Banks must now present a structured, tabular disclosure of exposures to related parties, covering loans and other arrangements, in the Notes to Accounts. The disclosures include aggregate loans sanctioned and outstanding, their proportion to total credit exposure, classification into Special Mention Accounts and Non-Performing Assets, and provisions made. The banks must disclose the value of contracts and arrangements awarded to, and outstanding with, related parties.
(Link: For Commercial Banks RBI Circular 181/2026 Dated 05/01/2026)
(Link: For Small Finance Banks RBI Circular 182/2026 Dated 05/01/2026)
(Link: For Local Area Banks RBI Circular 183/2026 Dated 05/01/2026)
(Link: For Regional Rural Banks RBI Circular 184/2026 Dated 05/01/2026)
(Link: For Urban Cooperative Banks RBI Circular 185/2026 Dated 05/01/2026)
(Link: For Rural Cooperative Banks RBI Circular 186/2026 Dated 05/01/2026)
(Link: For Non-Banking Financial Companies RBI Circular 187/2026 Dated 05/01/2026)
(Link: For All India Financial Institutions RBI Circular 188/2026 Dated 05/01/2026)
Amendments to Prudential Norms on Capital Adequacy Directions: The amendments revises risk weights for ratings assigned by S&P, Fitch, and Moody’s, and introduces a distinct risk-weight mapping for ratings issued by CareEdge Global IFSC Limited for exposures originating from the International Financial Services Centre (IFSC). For claims rated by S&P, Fitch, or Moody’s, risk weights range from 20% for the highest ratings to 150% for low-rated exposures, while unrated claims generally attract 100%. The directions impose stricter treatment for unrated exposures, i.e. claims with aggregate banking system exposure exceeding Rs 200 crore, or exposures that were earlier rated but later became unrated with exposure over Rs 100 crore, will attract a higher 150% risk weight. The unrated corporate claims cannot receive a risk weight lower than that of the sovereign of incorporation.
(Link: For Commercial Banks RBI Circular 189/2026 Dated 09/01/2026)
(Link:For Small Finance Banks RBI Circular 190/2026 Dated 09/01/2026)
(Link: For All India Financial Institutions RBI Circular 191/2026 Dated 09/01/2026)
RBI FAQs on Cheque Clearing: The FAQs explain the cheque clearing framework in India under the Cheque Truncation System (CTS), highlighting faster, image-based clearing and elimination of physical cheque movement. CTS allows only CTS-2010 compliant cheques, with non-CTS cheques no longer accepted for clearing though remaining valid negotiable instruments. The introduction of Continuous Clearing enables simultaneous presentation and confirmation, speeding up settlement through defined Item Expiry Time. The Positive Pay System enhances safety by matching cheque details submitted by issuers for high value cheques. Banks must preserve physical cheques for 10 years, provide acknowledgements, and follow care in scanning and stamping. Cheques up to Rs 1 lakh are collected free for savings accounts. Grievances relating to delays or non-payment can be escalated under the RBI Integrated Ombudsman Scheme.
(Link: RBI FAQs on Cheque Clearing Dated 07/01/2026)
Draft RBI Commercial Banks- Prudential Norms on Declaration of Dividend & Remittances of Profit Directions 2026: The Directions effective from FY 2026–27 tighten and standardise rules governing dividend pay-outs and profit remittances. Applicable to all commercial banks (excluding SFBs, LABs, Payments Banks, and RRBs) and foreign banks operating in branch mode, these mandate strict board oversight, sustained compliance with regulatory capital requirements, and positive adjusted profits as pre-requisites. Dividend pay-outs by Indian banks are capped through a CET1 based slab system and further limited to an overall ceiling of 75% of profit after tax, adjusted for net NPAs and exclusions such as exceptional income and unrealised gains. Foreign banks may remit profits without prior approval, subject to audit and compliance safeguards.
(Link: Press Release RBI Draft Directions Dated 06/01/2026)
(Link: For Commercial Banks RBI Draft Directions Dated 06/01/2026)
Draft RBI Prudential Norms on Declaration of Dividend Directions 2026: The directions mandates strong board oversight, requiring consideration of asset quality divergences, audit qualifications, capital adequacy, and long-term growth plans before declaring dividends. The eligibility for dividend pay-out depends on continuous compliance with regulatory capital requirements, positive adjusted Profit After Tax (PAT) after deducting net NPAs, and absence of regulatory restrictions. Dividends are capped at 75% of PAT and further linked to Tier 1 capital ratios through a graded bucket system, incentivising stronger capitalization. The directions prohibit dividend distribution from exceptional or unrealised gains and require deductions where audit reports indicate overstatement of profits.
(Link: Press Release RBI Draft Directions Dated 06/01/2026)
(Link: For Small Finance Banks RBI Draft Directions Dated 06/01/2026)
(Link: For Payment Banks RBI Draft Directions Dated 06/01/2026)
(Link: For Regional Rural Banks RBI Draft Directions Dated 06/01/2026)
(Link: For Local Area Banks RBI Draft Directions Dated 06/01/2026)
Draft RBI Cooperative Banks- Governance Amendment Directions: The draft amendments seek to introduce a mandatory minimum cooling-off period of three years for directors of co-operative banks after completion of the maximum permissible continuous tenure of ten years. A director who has completed ten years of continuous tenure on the board, shall be eligible for re-appointment to the board of the same bank only after undergoing a minimum cooling-off period of three years. During the cooling-off period, the director shall not be associated with the concerned bank in any capacity other than as a member or customer. However, this restriction will not preclude appointment as a director on the board of another bank.
(Link: Press Release RBI Draft Amendment Directions Dated 08/01/2026)
(Link: For Urban Coop Banks RBI Draft Amendment Directions Dated 08/01/2026)
(Link: For Rural Coop Banks RBI Draft Amendment Directions Dated 08/01/2026)
J. Miscellaneous
Draft Code on Wages (Central) Rules 2025: The Code on Wages 2019, all the provisions have been brought into force vide notification dated 18th December 2020 and dated 21st November, 2025. Now the draft rules have been notified for seeking objections and suggestions from the stakeholders.
(Link:Min of Labour Notification Dated 30/12/2025)
Draft Code on Social Security (Central) Rules 2025: The Code on Social Security 2020, all the provisions have been brought into force vide notification dated 30th April 2021, dated 3rd May 2023, dated 21st November 2025 and dated 19th December 2025. Now the draft rules have been notified for seeking objections and suggestions from the stakeholders.
(Link: Min of Labour Notification Dated 30/12/2025)
Draft Industrial Relations (Central) Rules 2025: The Industrial Relations Code 2020, all the provisions have been brought into force vide notification dated 21st November, 2025. Now the draft rules have been notified for seeking objections and suggestions from the stakeholders.
(Link: Min of Labour Notification Dated 30/12/2025)
Draft Occupational Safety, Health and Working Conditions (Central) Rules 2025: The Occupational Safety, Health and Working Conditions Code 2020, all the provisions have been brought into force vide notification dated 21st November, 2025. Now the draft rules have been notified for seeking objections and suggestions from the stakeholders.
(Link: Min of Labour Notification Dated 30/12/2025)
FAQs on Labour Codes: Ministry of Labour and Employment have issued the FAQs on Labour Codes for better understanding and clarity on the provisions.
(Link: FAQs on Labour Codes Dated 30/12/2025)
(Link: FAQs on Code on Wages Dated 30/12/2025)
(Link: FAQs on Code on Industrial Relations Dated 30/12/2025)
(Link: FAQs on Code on OSH Dated 30/12/2025)
(Link: FAQs on Code on Social Security Dated 09/01/2026)
SC, Retired Employees protected from Unauthorized Recovery Orders: Case of Kadirkhan Ahmedkhan Pathan vs Maharashtra State Warehousing Corporation, SC Judgement Dated 6th January 2026. The apex court held that a public sector enterprise cannot initiate or continue disciplinary proceedings against a retired employee unless its governing rules expressly enable such action. Even if the Maharashtra Civil Services (Pension) Rules were applicable, mandating prior government sanction for each specific post-retirement proceeding, the argument that a general 1990 approval of its regulations counted as ‘general sanction’ was rejected. The court quashed all departmental proceedings against the appellant.
(Link:SC Judgement Dated 06/01/2026)
SC, Highest Bid cannot be cancelled just to seek Higher Price: Case of Golden Food Products India vs State of Uttar Pradesh, SC Judgement Dated 6th January 2026. The apex court ruled that act of the state development authority is arbitrarily and violates Article 14 by cancelling the highest bid in a public auction solely because it subjectively expected a higher price, especially when based on an irrational comparison with prices of dissimilar assets. Upholding the sanctity of auctions, the court held that in absence of fraud or illegality, a valid highest bid above the reserve price creates a legitimate expectation for acceptance.
(Link:SC Judgement Dated 06/01/2026)
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