Analysis of Notifications and Circulars for Week ending 21st September 2025

Yash Paul Bhola 30 Sep 2025 5,376 Views 2 comments Print CA, CS, CMA | Articles, Featured

The week of September 15th-21st, 2025, witnessed significant regulatory activity, dominated by comprehensive GST rate rationalization and compliance changes. GST reforms, effective September 22, 2025, completely eliminated the Compensation Cess on 19 categories (including cars and coal), introduced a major new multi-tiered rate schedule (5%, 18%, 40% for luxury/sin, etc.), and exempted individual life/health insurance services. Related GST amendments simplified the annual return process by exempting small taxpayers (turnover up to Rs.2 crore) and tightened provisional refund rules for non-Aadhaar authenticated persons or specific high-risk goods. In Income Tax, the CBDT extended the ITR filing deadline for AY 2025-26 for non-audit cases to September 16, 2025, and waived interest under Section 220(2) on demands arising from incorrect Section 87A rebate claims if paid by December 31, 2025. SEBI focused on improving market mechanics, simplifying the transfer of securities to legal heirs, and advancing the Social Stock Exchange framework. The RBI issued consolidated directions for Payment Aggregators (PAs), standardizing capital requirements and due diligence rules. Finally, the PFRDA introduced the Multiple Scheme Framework for private NPS subscribers, allowing greater flexibility and higher equity allocation options.

Notifications & Circulars issued during week (15^th– 21^th Sep 2025)

(Income Tax, GST, Central Excise, Custom Duty, DGFT, SEBI, MCA, IBBI, RBI)
(Click the Link for Notification/ Circular as issued)

A. Income Tax

Exemptions to Ghaziabad Development Authority: Ghaziabad Development Authority, an authority constituted under the Uttar Pradesh Urban Planning and Development Act, 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 146/2025 Dated 15/09/2025)

Exemptions to Tamil Nadu Electricity Regulatory Commission: Tamil Nadu Electricity Regulatory Commission, a commission 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 the specified purposes under Section 10(46A) (a) of the Act.

(Link: Income Tax Notification 147/2025 Dated 15/09/2025)

Extension of due date for filing of ITRs for the Assessment Year 2025-26: CBDT extended the due date for filing Income Tax Returns (ITR) for the Assessment Year (AY) 2025-26, for non-auditable assesses, as defined in clause (c) of Explanation 2 to Section 139 (1) of the Act. The previous due date of 15^th September 2025, has been extended to 16^th September 2025.

(Link: Income Tax Circular 12/2025, Press Release Dated 15/09/2025)

CBDT Waives interest on section 87A Rebate demands after rectification: It was observed that in some instances, taxpayers were incorrectly granted rebate under section 87A on incomes chargeable to special tax rates under Chapter XII while opting for section 115BAC(1A). Subsequent rectifications to disallow such rebates resulted in additional demands being raised. Normally, any delay in paying these demands attracts interest under section 220(2). To reduce hardship for affected taxpayers, the CBDT has directed that such interest will be waived if the demand raised through rectification is paid on or before 31 December 2025. However, if the payment is not made by this date, interest under section 220(2) will apply from the day after the period allowed under section 220(1).

(Link: Income Tax Circular 13/2025, Press Release Dated 19/09/2025)

HC, Scam Proceeds Not Taxable Income, PMLA overrides Income Tax Act: Case of ACIT vs State, HC Delhi Judgement Dated 18th September 2025. HC held that money defrauded from investors does not constitute taxable income of a company or its directors but amounts to proceeds of crime under the Prevention of Money Laundering Act. The Court dismissed a petition by the Assistant Commissioner of Income Tax seeking release of fixed deposit receipts to recover tax dues, finding that such amounts cannot be appropriated as revenue before completion of the PMLA trial.

B. GST

Amendments to Central Goods and Services Tax Rules: The notification amends CGST Rules, mainly includes:

Rule 31A(2): Valuation factor changed by substituting 128 with 140 (impacts value of supply of lottery).
Rule 39(1A): Clarifies reverse charge references to CGST Act section 9 and IGST Act section 5(3) and 5(4); effective 1st April 2025.
Rule 91(2): Provisional refund order in FORM GST RFD-04 within 7 days based on risk; officer may skip provisional refund and proceed under rule 92; no revalidation of RFD-04; effective 1st October 2025.
Appeals: CGST Rule 110 updated to use new FORM GST APL-02A; new rule 110A enables single-member bench transfers where no question of law is involved; ties to section 109(8) threshold of INR 50 lakh; rule 113(2) introduces summary order FORM GST APL-04A.
Annual return changes (GSTR-9): New ITC rows (A1, A2, H1, etc.); clearer placement of reclaimed ITC with references to CGST Rules 37, 37A, 38, 39, 42, 43; revised Part V timing notes for FY 2024-25 onward; applicable from date of notifying in official gazatte.
Reconciliation statement (GSTR-9C): Adds fields for supplies covered by section 9(5) of CGST Act; late fee reference aligned to section 47(2); clarifies “payable” vs “paid”; applicable from date of notifying in official gazatte.

The notification is applicable from 22^nd September 2025, unless otherwise stated.

(Link: CGST Notification 13/2025 Dated 17/09/2025)

Persons not eligible for provisional refund: The notification effective from 1^st October 2025, provides that following category of registered persons who shall not be allowed refund on provisional basis under section 54(6) of the CGST Act.

any registered person without Aadhaar authentication per rule 10B;
persons supplying specified goods: areca nuts (0802 80), pan masala (2106 90 20), tobacco and manufactured tobacco substitutes (Chapter 24), and essential oils (3301).

(Link: CGST Notification 14/2025 Dated 17/09/2025)

Exemption from filing annual return (FORM GSTR-9) for small taxpayers: The notification provides that the registered persons with aggregate turnover up to INR 2 crore are exempt from filing the annual return for FY 2024-25 onwards.

(Link: CGST Notification 15/2025 Dated 17/09/2025)

Commencement of specified provisions of the Finance Act 2025: The notification appoints 1^st October 2025 as the date on which clauses (ii) and (iii) of section 121, sections 122 to 124, and sections 126 to 134 of the Finance Act 2025 come into force. These provisions are related to:

Section 121(ii) – Amendment to CGST Act section 2(69), adds “local fund” / “municipal fund” definitions.
Section 121(iii) – Inserts clause 2(116A), definition of “unique identification marking”.
Section 122 – Amendment of section 12, Time of supply for voucher for goods is removed
Section 123 – Amendment of section 13, Time of supply for voucher for services is removed
Section 124 – Amendment of section 17(5), Changing to ‘Plant and machinery’, Retrospectively from 1 July 2017, ITC on goods/services used to construct immovable property on own account remains blocked unless the resulting asset qualifies as plant and machinery.
Section 126 – Amendment of section 34, Amends CGST Act section 34(2) proviso (credit notes)
Section 127 – Amendment of section 38, ITC auto-generated statement
Section 128 – Amendment of section 39, Returns
Section 129 – Amendment of section 107, First appeals
Section 130 – Amendment of section 112, Appels to Appellate Tribunal
Section 131 – Insertion of new section 122B, penalty for failure to comply with track and trace mechanism.
Section 132 – Insertion of new section 148A, track and trace mechanism for certain goods.
Section 133 – Amendment of Schedule III (neither supply of goods nor services), Insertion of supply of goods warehoused in SEZ/FTWZ before export or to DTA
Section 134 – No refund of tax collected

(Link: CGST Notification 16/2025 Dated 17/09/2025)

GST Compensation Cess eliminated on 19 major product categories including Cars, Beverages, Coal and Luxury Items: The notification completely eliminates GST Compensation Cess on 19 major product categories including automobiles, beverages, coal, and luxury items. This comprehensive reform will benefit consumers across multiple sectors with significant price reductions expected on cars (cess reduced from 1% to 22% depending on category), soft drinks (12% cess removed), coal (₹400 per tonne cess removed), motorcycles above 350cc (3% cess removed), and luxury items like yachts and personal aircraft. The energy sector will particularly benefit as coal, lignite, and peat will no longer attract the ₹400 per tonne compensation cess.

Analysis of Notifications and Circulars for Week ending 21st September 2025

(Link: GST CESS Notification 02/2025 Dated 17/09/2025)

Revised GST rates on Goods and revised schedules: The notification supersedes earlier notification 01/2017 dated 28^th June 2017, and notify GST rates on various goods by detailed schedules. This includes major slab restructuring and new product/sector coverage in revised schedules.

Schedule I (5%): Essential goods (food grains, dairy, pulses, spices, medicines, renewable energy)
Schedule II (18%): Processed foods, spirits, cement, ores, sports goods, toys, art, manufactured products
Schedule III (40%): Soft drinks, luxury vehicles, yachts, aircraft, gambling
Schedule IV (3%): Gold/precious metal jewellery, silver coins, handcrafted idols, platinum products, semi-processed gems, handicrafts
Schedule V (0.25%) & Schedule VI (1.5%): Rough diamonds, industrial diamonds, uncut gemstones
Schedule VII (28%): Pan masala, Tobacco, cigarettes