The weekly regulatory update (30 March–5 April 2026) highlights significant developments across tax, GST, customs, DGFT, SEBI, MCA, IBBI, and RBI. The Finance Act 2026 introduces reforms aimed at simplifying compliance, rationalising penalties, and promoting investment. Key income tax changes include updated ITR forms, GAAR relief for pre-2017 investments, TDS tracking via UIN, and strengthened DIN compliance. GST reforms focus on fund settlement rules and clarifying appeal rights despite NIL demand orders. Customs measures grant duty exemptions, streamline courier processes, and extend faceless assessments. DGFT updates restrict imports of precious metals, extend export incentives, and relax timelines for exporters. MCA reduces DIR-3 KYC filing frequency, while IBBI adopts international valuation standards. RBI introduces major reforms on currency management, forex derivatives, overseas investment reporting, and export relief measures. Overall, the updates reflect a shift toward enhanced compliance, transparency, and trade facilitation, while balancing regulatory control with ease of doing business.
Notifications & Circulars issued during week (30th – 5th Apr 2026)
(Income Tax, GST, Central Excise, Custom Duty, DGFT, SEBI, MCA, IBBI, RBI)
(Click the Link for Notification/ Circular as issued)
A. Income Tax
The Finance Act 2026: The Finance Act, 2026 introduces several amendments to Income Tax Act, with the objective of simplifying compliance, rationalising penalties, promoting investment, and furthering the process of decriminalisation of tax offences. It has been notified on 30th March 2026. . The key provisions/ amendments are summarised in a separate article link provided as under.
(Link: Analysis of Direct Tax Amendments – The Finance Act 2026)
Memorandum of Understanding (MoU) between India and Japan for assistance in the collection of taxes under DTAA: The MoU establishes a framework for cooperation in tax recovery between the two countries. Indian authorities can now seek and provide assistance to Japan for tax recovery in eligible cases.
(Link: Income Tax Notification 56/2026 Dated 31/03/2026)
Amendment to Rule 128 to Exclude Pre-2017 Investments from Anti-Abuse Provisions: The amendment clarifies the tax treatment of income arising from investments made before 1st April 2017, that it is excluded from the applicability of Chapter XI provisions. While Anti-Abuse provisions will apply to all arrangements, regardless of when they were entered into, if the tax benefit arises on or after 1st April 2017, an exception is carved out for income derived from the transfer of investments made prior to 1st April 2017, which remains outside the scope of these anti-abuse provisions.
(Link: Income Tax Notification 55/2026 Dated 31/03/2026)
Amendment to Rule 10U to Protect Pre-2017 Investments from GAAR Applicability: The amendment clarifies the applicability of Chapter X-A (General Anti Avoidance Rules – GAAR) concerning investments made before 1st April 2017, that any income arising from the transfer of such pre-2017 investments shall be excluded from the ambit of GAAR. While GAAR provisions will apply to tax benefits arising on or after 1st April 2017 irrespective of when the arrangement was entered into, an explicit exception has been carved out for income derived from the transfer of grandfathered investments.
(Link: Income Tax Notification 54/2026 Dated 31/03/2026)
Exemption to Andhra Pradesh Pollution Control Board: Rajasthan Electricity Regulatory Commission, a Commission constituted under the Electricity Regulatory Commissions Act 1998, 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 Income Tax Act.
(Link: Income Tax Notification 53/2026 Dated 31/03/2026)
CBDT notifies ITR-U form Form for AY 2026–27: The amendment inserts a new Form ITR-U in Appendix II of the Income Tax Rules 1962. ITR-U is used for filing updated returns, enabling taxpayers to rectify omissions or errors in previously filed returns.
(Link: Income Tax Notification 52/2026 Dated 30/03/2026)
CBDT notifies ITR-V Form for AY 2026–27: The amendment substitutes the existing Form ITR-V in Appendix II of the Income Tax Rules 1962. The ITR-V form is the verification form used for electronically filed returns without digital signatures.
(Link: Income Tax Notification 51/2026 Dated 30/03/2026)
CBDT notifies Revised ITR-7 Form for AY 2026-27: The amendment substitutes the existing Form ITR-7 in Appendix II of the Income Tax Rules, 1962. The ITR-7 form is used by persons including companies required to furnish return under sections 139(4A) or 139(4B) or 139(4C) or 139(4D) only.
(Link: Income Tax Notification 50/2026 Dated 30/03/2026)
CBDT notifies Revised ITR-6 Form for AY 2026-27: The amendment substitutes a revised Form ITR-6 in Appendix II of the Income Tax Rules, 1962. The Form ITR-6 is used by companies other than those claiming exemption under section 11 of Income Tax Act.
(Link: Income Tax Notification 49/2026 Dated 30/03/2026)
CBDT notifies Revised ITR-5 for AY 2026-27: The amendment substitutes Form ITR-5 in Appendix-II of the Income Tax Rules 1962. The Form ITR-5 for is used by persons other than (i) individual, (ii) HUF (iii) Company and (iv) Persons filing For ITR-7.
(Link: Income Tax Notification 48/2026 Dated 30/03/2026)
CBDT notifies Revised ITR-3 for AY 2026-27: The amendment substitutes the existing Form ITR-3 in Appendix II of the Income Tax Rules 1962. The Form ITR-3 is used by individuals and HUFs having income from profits and gains of business or profession.
(Link: Income Tax Notification 47/2026 Dated 30/03/2026)
CBDT notifies revised ITR-2 for AY 2026-27: The amendment substitutes the existing Form ITR-2 in Appendix II of the Income Tax Rules 1962. The Form ITR-2 is used by individuals and Hindu Undivided Families (HUFs) not having income from business or profession.
(Link: Income Tax Notification 46/2026 Dated 30/03/2026)
CBDT notifies ITR-1 SAHAJ and ITR-4 SUGAM for AY 2026-27: The amendment substitutes the existing Form ITR-1 SAHAJ and ITR-4 SUGAM in Appendix II of Income Tax Rules 1962.
— ITR-1 is prescribed for individuals who are residents (other than not ordinarily resident) with total income up to Rs 50 lakh. Eligible income sources include salary/pension, income from up to two house properties, income from other sources such as interest, long-term capital gains under section 112A up to Rs 1.25 lakh, and agricultural income up to Rs 5,000. However, it excludes individuals who are directors in a company, have invested in unlisted equity shares, have deferred tax on ESOPs, or hold foreign assets or financial interests outside India.
— ITR-4 applies to resident individuals, Hindu Undivided Families (HUFs), and firms (other than LLPs) with total income up to Rs 50 lakh. It is meant for those having income from business or profession computed under presumptive taxation schemes (sections 44AD, 44ADA, or 44AE), along with eligible salary, house property, and other income, and long-term capital gains under section 112A up to Rs 1.25 lakh. It excludes persons who are company directors, hold unlisted shares, have deferred ESOP taxation, have foreign assets, or have agricultural income exceeding Rs 5,000.
(Link: Income Tax Notification 45/2026 Dated 30/03/2026)
Exemptions to Chandigarh Building and Other Construction Workers Welfare Board: Chandigarh Building and Other Construction Workers Welfare Board, a Board established by the Chandigarh Administration, has been notified under section 10(46) for exemption on its income arising from amount received as Cess collected under Cess Act, Contributions paid by the beneficiaries, and Interest on bank deposits.
(Link: Income Tax Notification 44/2026 Dated 30/03/2026)
Indian Rubber Materials Research Institute, Thane notified under section 35(1)(ii) for Scientific Research: It notifies Indian Rubber Materials Research Institute, Thane, Maharashtra for ‘Scientific Research’ under the category of ‘Research Association’ for the purposes section 35(1)(ii) of the Income-tax Act, read with rules 5C and 5E of the Income-tax Rules. This section allows for deduction equal to one and half times while computing taxes for expenses relating to scientific research.
(Link: Income Tax Notification 43/2026 Dated 30/03/2026)
Indian Institute of Technology (IIT) Bombay notified under section 35(1)(ii) for Scientific Research: It notifies Indian Institute of Technology (IIT) Bombay, for ‘Scientific Research’ under the category of ‘University, college or other institution’ for the purposes section 35(1)(ii) of the Income-tax Act, read with rules 5C and 5E of the Income-tax Rules. This section allows for deduction equal to one and half times while computing taxes for expenses relating to scientific research.
(Link: Income Tax Notification 42/2026 Dated 30/03/2026)
Exemption to Karnataka Industrial Areas Development Board: Karnataka Industrial Areas Development Board, a board constituted under the Karnataka Industrial Areas Development Act, 1966, 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 Income Tax Act.
(Link: Income Tax Notification 41/2026 Dated 30/03/2026)
Indian Institute of Technology (IIT) Bhilai notified under section 35(1)(ii) for Scientific Research: It notifies Indian Institute of Technology (IIT) Bhilai, for ‘Scientific Research’ under the category of ‘University, college or other institution’ for the purposes section 35(1)(ii) of the Income-tax Act, read with rules 5C and 5E of the Income-tax Rules. This section allows for deduction equal to one and half times while computing taxes for expenses relating to scientific research.
(Link: Income Tax Notification 40/2026 Dated 30/03/2026)
CBDT notifies amended India-Brazil Tax Treaty: The notification amends the treaty by incorporating anti-abuse measures, including a revised preamble, Principal Purpose Test, and Limitation of Benefits provisions to curb treaty shopping and tax evasion. It expands definitions (e.g., resident, permanent establishment), introduces rules for service PEs, and refines taxation of dividends, interest, royalties, and fees for technical services with specified withholding tax caps. It also updates provisions on capital gains, employment income, and dispute resolution.
(Link: Income Tax Notification 39/2026 Dated 30/03/2026)
Mandatory Unique Identification Number (UIN) System introduced to Track Non deduction of TDS Declarations under Form 121: The notification mandates that payers assign a 26-character UIN to each declaration received from payees seeking non-deduction of tax, comprising a sequence number, tax year, and payer’s TAN. It requires digitization of paper declarations and maintenance of a continuous sequence, reset annually. The payers also must furnish Part B of Form No. 121 quarterly on the e-filing portal, irrespective of whether tax has been deducted.
(Link: Income Tax Notification 01/2026 CPC(TDS) Dated 28/03/2026)
Referencing by Document Identification Number (DIN): The circular mandates that all communications such as notices, orders, summons, and letters issued to taxpayers must carry a DIN or be appropriately referenced. DIN may be included directly, via attachment, or through electronic correspondence, and need not appear on every page. Exceptions are permitted in specific situations like technical issues or lack of PAN, subject to recording reasons and obtaining post-facto approval within 15 days. Such communications must also be uploaded with DIN subsequently.
(Link: Income Tax Circular 04/2026 Dated 31/03/2026)
Sovereign Wealth Fund Tax exemption Rules & Procedure: The circular prescribes the procedure for notification and compliance of Sovereign Wealth Funds (SWFs) under Schedule V of the Income Tax Act 2025. It facilitates tax exemption benefits for specified income such as dividends, interest, and capital gains arising from investments in notified infrastructure sectors, subject to conditions like investment period and minimum holding of three years. It introduces Form I for SWFs seeking notification and Form II for quarterly reporting of investments.
(Link: Income Tax Circular 03/2026 Dated 30/03/2026)
Clarification on Section 194A TDS on interest in case of Banking Institutions: The X account post by Income Tax Department reiterates that banking companies are not required to deduct TDS where interest does not exceed the prescribed threshold. The clarification addresses the definition of “banking company” under the new law, noting that although the explicit reference to institutions covered under Section 51 of the Banking Regulation Act, has been omitted in the Income Tax Act, 2025, such institutions continue to be included within its scope. Accordingly, these banks and institutions remain eligible for the threshold exemption from TDS under the revised provisions.
(Link: Income Tax X account Post Dated 30/03/2026)
B. GST
Goods and Services Tax Settlement of Funds Rules 2026: The Ministry of Finance has notified the Goods and Services Tax Settlement of Funds Rules, 2026, replacing the earlier 2017 rules to streamline the settlement of GST funds between the Centre and States. The rules establish a comprehensive framework for electronic transmission of reports, cross-utilisation of input tax credit, and apportionment of Integrated GST (IGST). The rules prescribe detailed reporting formats (GST STL series) for tracking tax utilisation, refunds, recoveries, and fund transfers, ensuring transparency and accuracy in settlement.
(Link: Fin Min GST Notification Dated 30/03/2026)
GSTN, Clarifications on Appeal Rights due to incorrect NIL demand in Adjudication Orders: The GSTN has issued a clarification addressing difficulties faced by taxpayers in filing appeals on the GST portal where adjudication orders reflect a “NIL” demand despite disputes on tax liability. This issue arises when taxpayers make voluntary payments at the Show Cause Notice (SCN) stage without admitting liability, and the adjudicating authority treats such payments as full discharge without determining the actual liability. GSTN clarified that such payments do not amount to acceptance of liability and taxpayers retain the right to appeal. As a remedy, taxpayers are advised to seek a rectification order from the adjudicating authority to reflect the correct demand, after which appeals can be filed within prescribed timelines.
(Link: GSTN Advisory Dated 03/04/2026)
C. Central Excise
No Notification/ Circular during the week.
D. Custom Duty
Exemption of AIDC on Ammonium Nitrate till June 2026: The Central Government has reduced the effective AIDC rate on Ammonium Nitrate (tariff item 3102 30 00) to ‘Nil’, and it will remain valid until 30th June 2026.
(Link: Customs Notification 13/2026 (T) Dated 01/04/2026)
Customs Duty waived on specified Petrochemicals Products till June 2026: The basic customs duty (BCD) has been exempted on import of goods listed in the Table annexed to the notification, covering various chemicals, petrochemicals, and polymer products classified under specified tariff headings of the Customs Tariff Act. These include substances such as anhydrous ammonia, toluene, styrene, methanol, isopropyl alcohol, ammonium nitrate, among others.
(Link: Customs Notification 12/2026 (T) Dated 01/04/2026)
SEZ Units granted Duty Exemption due to Domestic Supply Promotion Policy: The notification allows conditional customs duty exemptions on goods manufactured by Special Economic Zone (SEZ) units and cleared to the Domestic Tariff Area (DTA). It allows reduced customs duty and Agriculture Infrastructure and Development Cess (AIDC) based on specified rates, subject to compliance with conditions. It excludes units in Free Trade and Warehousing Zones and goods merely imported into SEZ and removed without manufacturing.
(Link: Customs Notification 11/2026 (T) Dated 31/03/2026)
Mauritius 6th Tranche Customs FTA Notification: The notification amends earlier Notification 25/2021 dated 31st March 2021 and substituted existing tables with revised tables. The revised tables update duty structures, align classifications, or modify concession rates as per current policy requirements.
(Link: Customs Notification 10/2026 (T) Dated 31/03/2026)
UAE 5th Tranche Customs FTA Notification: The notification amends earlier Notification 22/2022 dated 30th April 2022 and substituted existing tables with revised tables. The revised tables update duty structures, align classifications, or modify concession rates as per current policy requirements.
(Link: Customs Notification 09/2026 (T) Dated 31/03/2026)
Amendments relating to duty exemptions on Re-import of Goods: The notification amends earlier notification 45/2017 dated 30th June 2017, clarifying that exemption conditions apply only where the re-imported goods are the same as those originally exported. It further introduces a provision that goods re-imported through courier mode, except those specified under the Courier Imports and Exports Regulations, shall be subject to risk-based treatment.
(Link: Customs Notification 08/2026 (T) Dated 30/03/2026)
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. 3rd April 2026. The tariff value for crude palm oil is set at USD 1141 per metric ton, while gold and silver have tariff values of USD 1526 per 10 grams and USD 2427 per kilogram, respectively. The tariff value for areca nuts is fixed at USD 7020 per metric ton.
(Link: Customs Notification 35/2926 (NT) Dated 02/04/2026)
Courier Rules amended for faster disposal of Uncleared Imported Goods: The notification amends the Courier Imports and Exports (Clearance) Regulation and revises procedures for handling uncleared imported goods. Goods not cleared within 30 days will be detained and disposed of after notice, with storage charges payable by the authorised courier. The couriers may also request re-export or return of goods after 15 days, subject to conditions.
(Link: Customs Notification 34/2026 (NT) Dated 31/03/2026)
Amendments to Courier Regulations to allow Re-Export of Uncleared Goods After 15 Days: The amended regulations permits authorized couriers to request re-export or return of imported goods remaining uncleared after fifteen days from arrival, provided such goods are not prohibited or restricted and no enforcement proceedings have been initiated.
(Link: Customs Notification 33/2026 (NT) Dated 31/03/2026)
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. 31st March 2026. The tariff value for crude palm oil is set at USD 1141 per metric ton, while gold and silver have tariff values of USD 1450 per 10 grams and USD 2201 per kilogram, respectively. The tariff value for areca nuts is fixed at USD 7020 per metric ton.
(Link: Customs Notification 32/2026 (NT) Dated 30/03/2026)
Amendments to Sea Cargo Manifest and Transhipment Regulations: The amendment primarily modifies the compliance timeline specified in the regulatory table following Form XII, against Serial No. 6 in column (3) till 30th June 2026.
(Link: Customs Notification 31/2026 (NT) Dated 30/03/2026)
Faceless Assessment for SEZ to DTA Clearances for Concessional Duty Benefit: The circular mandates that Bills of Entry filed for goods manufactured by Special Economic Zone (SEZ) units and cleared to the Domestic Tariff Area (DTA) under concessional duty rates, shall be assessed under the faceless assessment system to ensure uniformity, transparency, and efficiency. These consignments will also be routed through the Risk Management System (RMS) for automated allocation to officers.
(Link: Customs Circular 18/2026 Dated 01/04/2026)
Removal of Value Limit of Rs 10 Lakh for Commercial Export through Courier: The circular removes the Rs 10 lakh value cap on courier export consignments, enabling greater flexibility for exporters, including non-e-commerce goods. It also introduces a Return to Origin (RTO) mechanism allowing re-export of uncleared or unclaimed imported goods after 15 days, thereby reducing congestion at courier terminals and improving logistics efficiency. Also, the process for re-import of returned or rejected goods has been simplified through a risk-based framework, replacing cumbersome verification requirements.
(Link: Customs Circular 17/2026 Dated 31/03/2026)
SCMTR Transition extended to June 2026 for system Development & Testing: The implementation of the Sea Cargo Manifest and Transhipment Regulations (SCMTR) has been reviewed. While electronic filing of cargo movement messages between ports has been successfully implemented nationwide, uniform adoption of Stuffing (SF) messages remains incomplete. To address ongoing system development and testing requirements across ICDs, CFSs, SEZs, and gateway ports, the transitional provisions for SCMTR have been extended until 30th June 2026.
(Link: Customs Circular 16/2026 Dated 30/03/2026)
E. Directorate General of Foreign Trade (DGFT)
Amendment in Import Policy and conditions of items under Chapter 71 of ITC: Several items including gold and silver related articles, platinum products, and precious metal goods have been shifted from ‘Free’ to ‘Restricted’ import status, subject to newly introduced policy condition. It, however, exempts imports by Export Oriented Units (EOUs), Special Economic Zones (SEZs), and export-linked schemes, provided such goods are not diverted to the Domestic Tariff Area.
(Link: DGFT Notification 03/2026 Dated 02/04/2026)
Amendment in Import Policy of items covered under CTH 7113 under Chapter 71 of ITC: The notification revises several categories of jewellery made of precious metals, including gold, silver, platinum, and studded variants, from ‘Free’ to ‘Restricted’ import status. These restrictions apply regardless of prior contracts, letters of credit, advance payments, or shipment status, and the benefit of transitional arrangements has been expressly denied.
(Link: DGFT Notification 02/2026 Dated 01/04/2026)
Supply of essential commodities to the Republic of Maldives during FY 2026-27: The notification allows export of items such as eggs, rice, wheat flour, sugar, onions, potatoes, dal, stone aggregate, and river sand within prescribed quantity limits, while exempting these exports from any existing or future restrictions. However, exports of restricted or prohibited items are permitted only through six designated customs ports.
(Link: DGFT Notification 01/2026 Dated 01/04/2026)
Existing RoDTEP Rates for Exports extended till September 2026: The notification extends the Remission of Duties and Taxes on Exported Products (RoDTEP) Scheme for a further period of six months, till 30th September 2026, for all eligible export products.
(Link: DGFT Notification 74/2026 Dated 31/03/2026)
Re-import Period for Diamond Exporters extended to Four Months: The notification provide a one-time relaxation for eligible exporters of cut and polished diamonds (0.25 carat or above) with specified turnover criteria to benefit from an extended re-import timeline at zero duty. In cases where the original re-import period of three months expires between 1st March 2026 and 31st May 2026, the deadline will automatically be extended by 30 days. This effectively increases the re-import period to four months for such shipments.
(Link: DGFT Notification 73/2026 Dated 31/03/2026)
Free Import Policy for Tur/ Pigeon Peas extended till March 2027: The notification extends the ‘Free’ import policy for Tur/ Pigeon Peas (Cajanus Cajan) classified under ITC (HS) Code 07136000, previously valid up to 31st March 2026, until 31st March 2027.
(Link: DGFT Notification 72/2026 Dated 31/03/2026)
Free Import Policy for Urad extended till March 2027: The notification extends the ‘Free’ import policy for Urad (Vigna Mungo) classified under ITC (HS) Code 07133110, previously valid up to 31st March 2026, until 31st March 2027.
(Link: DGFT Notification 71/2026 Dated 31/03/2026)
Free Import Policy for Yellow Peas till March 31, 2027: The notification extends the ‘Free’ import policy for Yellow Peas under ITC (HS) Code 07131010, previously valid up to 31 March 2026, until 31 March 2027.
(Link: DGFT Notification 70/2026 Dated 31/03/2026)
MIP on Virgin Paper Board Imports extended till April 2026: The notification extends the existing Minimum Import Price (MIP) MIP of INR 67,220 per metric tonne (CIF value) on imports of Virgin Multi-layer Paper Board (VPB), previously valid up to 31 March 2026, until 31 March 2027.
(Link: DGFT Notification 69/2026 Dated 31/03/2026)
Export & Re-Import deadlines extended for Gem & Jewellery Sector due to Global Trade Disruptions: The one-time relaxation grants an automatic extension of 30 days for re-export, export, and re-import periods where such timelines expire between 1st March 2026 and 31st May 2026.
(Link: DGFT Public Notice 54/2026 Dated 30/03/2026)
Special drive for expeditious issuance of EODCs under Advance Authorisation (AA) and EPCG Schemes: DGFT has extended its special drive for expedited issuance of Export Obligation Discharge Certificates (EODCs) under Advance Authorisation (AA) and Export Promotion Capital Goods (EPCG) schemes until 31st May 2026.
(Link: DGFT Trade Notice 34/2026 Dated 01/04/2026)
F. Securities and Exchange Board of India (SEBI)
Consultation Paper on Reintroduction of Open Market Buy Back of Shares or Other Specified Securities through Stock Exchange: This method was discontinued from 1st April 2025 due to concerns over unequal shareholder participation and tax related inequities under the earlier regime. The paper outlines that the taxation framework has since evolved, shifting the tax burden to shareholders and treating buyback proceeds as capital gains, thereby addressing earlier concerns. The feedback/ comments from stakeholders are invited.
(Link: SEBI Consultation Paper Dated 02/04/2026)
G. Ministry of Corporate Affairs (MCA)
DIR-3 KYC filing reduced to once every Three Years to cut Compliance Burden: Under the revised rules, effective from 31st March 2026, directors holding a DIN as of 31st March of a financial year are required to file Form DIR-3 KYC Web once every three financial years, instead of annually, with a deadline of 30th June. However, any change in key details such as mobile number, email ID, or residential address must be updated within 30 days through the same form along with the prescribed fee. It also replaces existing forms with a single DIR-3 KYC Web form.
(Link: MCA Update for Directors Dated 31/03/2026)
H. Insolvency and Bankruptcy Board of India (IBBI)
Valuation Standards for the purpose of valuation conducted under IBC: The IBBI has notified the adoption of International Valuation Standards (IVS) for all valuations conducted under the Insolvency and Bankruptcy Code (IBC). It applies across various processes including corporate insolvency resolution, liquidation, voluntary liquidation, pre-pack insolvency, and bankruptcy of personal guarantors.
(Link: IBBI Circular Dated 01/04/2026)
I. Reserve Bank of India (RBI)
Master Direction on Incentives for Currency Distribution and Exchange and Penalties for Deficiency in Service: It introduces financial incentives for banks to establish and maintain currency chest (CC) infrastructure, exchange soiled and mutilated notes, and distribute coins, including additional benefits for rural and remote areas. It also prescribes strict penalties for deficiencies such as refusal to exchange notes, non-availability of coins, ATM cash-outs, counterfeit note circulation, reporting errors, and operational lapses in CCs.
(Link: RBI aster Directions 393/2026 Dated 01/04/2026)
Master Direction on Counterfeit Notes- Detection, Reporting and Monitoring: The banks and RBI offices are authorised to impound counterfeit notes, which must not be returned or credited to customers. Mandatory machine-based verification is required for all notes received, and counterfeit notes must be stamped, recorded, and acknowledged through receipts. Reporting obligations are stringent, small cases are reported monthly, while larger instances require immediate FIR filing with police. Banks must install detection device and maintain CCTV surveillance.
(Link: RBI aster Directions 394/2026 Dated 01/04/2026)
Master Direction– Facility for Exchange of Notes and Coins: The updated directions mandate all bank branches to provide free and non-discriminatory service for exchange of notes ad coins to the public. Banks must accept soiled, mutilated, and imperfect notes, as well as coins of valid denominations, and ensure adequate availability of cash through ATMs. These clarify definitions of defective notes, procedures for their adjudication, and timelines for their exchange or credit.
(Link: RBI aster Directions 395/2026 Dated 01/04/2026)
Floating Rate Savings Bonds, 2020 (Taxable) Operational Guidelines: The updated guidelines governs issuance, servicing, interest payments, nomination, premature encashment, and redemption of Floating Rate Savings Bonds. These Bonds are issued in electronic form through authorised Receiving Offices (ROs) and credited to Bond Ledger Accounts (BLA). Applications may be submitted offline or online, with PAN or prescribed declarations, and KYC compliance is mandatory. Interest is linked to the National Savings Certificate (NSC) rate with a spread of 35 basis points and is reset semi-annually. The bonds have a tenure of seven years, with provisions for nomination, transfer on death, and premature encashment subject to conditions.
(Link: RBI Circular 06/2026 Dated 02/04/2026)
Residents allowed to exchange INR at Airport Departure Forex Counters: The amended instructions allows residents, in addition to non-residents, to exchange Indian Rupee (INR) notes at foreign exchange counters located in departure halls within Duty-Free Areas or Security Hold Areas beyond immigration or customs checkpoints. Previously, such facilities were primarily accessible to non-residents or subject to restrictions.
(Link: RBI Circular 05/2026 Dated 02/04/2026)
Non-Deliverable INR Derivatives barred to Curb Forex Risk: Authorised Dealers (ADs) are now prohibited from offering non-deliverable derivative contracts involving the Indian Rupee (INR) to both residents and non-residents. However, deliverable forex derivatives may still be offered for genuine hedging purposes, provided users do not maintain offsetting non-deliverable positions.
(Link: RBI Circular 04/2026 Dated 01/04/2026)
PRAVAAH Portal made mandatory for Overseas Investment Submissions: Under the new framework, the references related to Overseas Investment submitted by persons resident in India, will be processed at seven designated Regional Offices of the RBI, based on the Unique Identification Number (UIN) prefix of the foreign entity. Authorised Dealer Category I Banks are now required to submit references through the PRAVAAH portal to the respective Regional Office as per the prescribed mapping.
(Link: RBI Circular 03/2026 Dated 01/04/2026)
Reporting under FEMA Guarantees Regulations: The persons obligated to report guarantees must use specified forms, i.e., Form GRN Issue for issuance, Form GRN Modification for changes, and Form GRN Invocation for invocation, and submit them to authorised dealer banks. These banks are required to report such returns to RBI through the Centralised Information Management System (CIMS) within 30 days from the end of the relevant quarter. A unique Guarantee Transaction Number must be assigned for each issuance.
(Link: RBI Circular 02/2026 Dated 01/04/2026)
Updates on UNSC Sanctions List Under UAPA Compliance: MEA has informed about the UNSC amendments on its ISIL (Da’esh) and Al-Qaida Sanctions List of individuals and entities, which are subject to the assets freeze, travel ban and arms embargo. Regulated Entities (REs) are advised to take note for necessary compliance in terms of Master Directions on KYC.
(Link: RBI Circular 01/2026 Dated 01/04/2026)
Assignment of Lead Bank Responsibility: The Lead Bank responsibility has been assigned to State Bank of India for new district Khushavati created in state of Goa.
(Link: RBI Circular 264/2026 Dated 31/03/2026)
RBI Trade Relief Measures Directions, 2026: In view of challenges faced by exporters due to geopolitical tensions and logistical disruptions, the relaxation regarding extending the time for realisation and repatriation of export proceeds from nine months to fifteen months, has been extended. Also, the enhanced export credit period for both pre-shipment and post-shipment credit has been extended to 450 days for disbursals made up to 30th June 2026.
(Link: RBI Circular 263/2026 Dated 31/03/2026)
Amendments to RBI Small Finance Banks Financial Statements- Presentation and Disclosures Directions: The key change is the restructuring of capital market exposure disclosures under ‘Notes to Accounts’, including introduction of a detailed reporting table. Banks must now disclose detailed exposure in categories such as investments in equity instruments, advances for share investments, collateral-backed loans, exposure to capital market intermediaries, underwriting commitments, and derivative-related trade exposures.
(Link: RBI Circular 262/2026 Dated 30/03/2026)
Amendments to RBI Small Finance Banks Prudential Norms on Capital Adequacy Directions: The amendments relating to risk-weighted assets (RWAs), clarifies that irrevocable payment commitments issued by banks to clearing corporations on behalf of clients shall be treated as financial guarantees with a credit conversion factor (CCF) of 100%. However, capital is required to be maintained only on the exposure classified as capital market exposure (CME), with a risk weight of 125%.
(Link: RBI Circular 261/2026 Dated 30/03/2026)
Amendments to RBI Small Finance Banks Concentration Risk Management Directions: The amendments introduce new definitions, including Capital Market Intermediaries, Collateral Security, Non-debt Mutual Funds, and Primary Security, while deleting certain earlier provisions. A comprehensive framework for Capital Market Exposure (CME) has been introduced, covering both direct and indirect exposures such as investments, credit facilities, underwriting commitments, and derivative exposures. Prudential ceilings have been prescribed, limiting aggregate CME to 40% of Tier 1 capital and direct exposure to 20% of eligible capital base, with provisions for intra-day exposure limits.
(Link: RBI Circular 260/2026 Dated 30/03/2026)
Amendments to RBI Small Finance Banks Credit Facilities Directions: The amendments redefine key terms such as collateral, capital market intermediaries (CMIs), eligible securities, loan-to-value (LTV), and margin. A new framework for loans against eligible securities prescribes LTV ceilings, valuation norms, prudential limits, and monitoring requirements. Certain loans are prohibited, including those against own securities, partly paid shares, and locked-in securities. The credit facilities to CMIs, permits specific financing activities while restricting lending for proprietary trading unless fully secured. All such exposures are to be treated as capital market exposure (CME).
(Link: RBI Circular 259/2026 Dated 30/03/2026)
Amendments to RBI Commercial Banks Undertaking of Financial Services Directions: The amendments expand permissible financial services by allowing acquisition finance and bridge finance for funding promoters’ stake in new companies and clarify provisions relating to lending to individuals against eligible securities.
(Link: RBI Circular 258/2026 Dated 30/03/2026)
Amendments to RBI Commercial Banks Financial Statements- Presentation and Disclosures Directions: The amendment introduce a detailed disclosure format for ‘Exposure to Capital Markets’. Banks are required to provide detailed reporting of capital market exposures, including direct investments, advances against securities, acquisition and bridge finance, funding to intermediaries, underwriting commitments, and derivative-related exposures.
(Link: RBI Circular 257/2026 Dated 30/03/2026)
Amendments to RBI Commercial Banks Prudential Norms on Capital Adequacy Directions: The amendment clarifies that irrevocable payment commitments (IPCs) issued by banks to clearing corporations on behalf of clients shall be treated as financial guarantees with a credit conversion factor of 100%. However, capital is required to be maintained only on the portion classified as capital market exposure (CME) under the relevant concentration risk management framework. The applicable risk weight for such exposure has been prescribed at 125%.
(Link: RBI Circular 256/2026 Dated 30/03/2026)
Amendments to RBI Commercial Banks Concentration Risk Management Directions: The amendments expand the scope of Capital Market Exposure (CME), and introduce comprehensive exposure norms, including both direct and indirect exposures such as investments, credit facilities, underwriting commitments, and bridge/acquisition finance. The revised framework sets prudential ceilings, aggregate CME capped at 40% of eligible capital base, direct exposure at 20%, and acquisition finance exposure at 20%. It also introduces detailed computation methods and specifies exclusions for certain investments and infrastructure entities.
(Link: RBI Circular 255/2026 Dated 30/03/2026)
Amendments to Commercial Banks Credit Facilities Directions: The amendments introduce detailed definitions for acquisition finance, bridge finance, collateral, and capital market intermediaries, while setting clear eligibility, prudential limits, and governance requirements. Banks are permitted to extend acquisition finance subject to strict conditions, including financial strength of borrowers, maximum financing cap of 75% of acquisition value, debt-equity ratio limits, and mandatory board-approved policies. It also governs loans against eligible securities by prescribing loan to value ratios, exposure caps, and restrictions on speculative lending.
(Link: RBI Circular 254/2026 Dated 30/03/2026)
External Commercial Borrowing (ECB) Reporting Rules Revised: The circular clarifies that Form ECB 1 and Revised Form ECB 1 will be treated as returns that do not capture financial flows, affecting computation of Late Submission Fees (LSF). It provides that each delayed submission of Form ECB 2 under a Loan Registration Number will be treated as a separate instance for LSF calculation. Authorised Dealer Category I banks are required to submit complete returns to the RBI within seven days of receipt from borrowers.
(Link: RBI Circular 253/2026 Dated 30/03/2026)
J. Miscellaneous
ICAI Mandates Guidance Notes for LLPs & Non-Corporates in Two Phases: The Institute of Chartered Accountants of India (ICAI) has announced the phased applicability of the Guidance Note on Financial Statements of Non-Corporate Entities and Limited Liability Partnerships for annual reporting periods starting 2025–26. Phase I applies to accounting periods beginning on or after 1st April 2025 and covers entities with turnover exceeding ₹5 crore. Phase II extends applicability to all such entities for accounting periods beginning on or after 1st April 2026.
(Link: ICAI Announcement Dated 31/03/2026)
ICAI Defers SQM 1 and SQM 2 Implementation: The Standards on Quality Management (SQM 1 and SQM 2) were scheduled to come into force from 1st April 2026. These standards were intended to replace the existing Standard on Quality Control (SQC 1), which has been in force since 2009 and governs quality control for audit and assurance engagements. ICAI has decided to postpone the implementation of SQM 1 and SQM 2 until further notice. As a result, SQC 1 will continue to remain applicable to audit firms and professionals for the time being.
(Link: ICAI Announcement Dated 31/03/2026)
Small Savings Schemes Interest Rates for April to June 2026: Ministry of Finance has announced that the interest rates on all Small Savings Schemes for the first quarter of FY 2026–27 (1 April 2026 to 30 June 2026) will remain unchanged from those applicable in the fourth quarter. Accordingly, rates such as 4.0% on Savings Deposits, 6.9% to 7.5% on Time Deposits, 6.7% on 5-Year Recurring Deposits, 8.2% under the Senior Citizen Savings Scheme, 7.4% under the Monthly Income Account Scheme, 7.7% for National Saving Certificates, 7.1% for Public Provident Fund, 8.2% for Sukanya Samriddhi Account Scheme and 7.5% for Kisan Vikas Patra (maturing in 115 months) continue without change.
(Link: Fin Min DEA OM Dated 30/03/2026)
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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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