Weekly Round-up on Tax and Corporate Laws | 14th to 19th April 2025

This weekly newsletter analytically summarises the key stories reported at taxmann.com during the previous week from April 14^th to 19^th, 2025, namely:

1. Consumer Protection Authority fines 24 coaching centres Rs. 77.6 lakh for misleading ads; urges compliance with Guidelines;
2. No penalty under Black Money Act if assessee was only joint holder of foreign asset for administrative purposes: ITAT;
3. Govt. clarifies that no proposal to levy GST on UPI transactions above Rs. 2,000: Press Release;
4. GSTN issues advisory on reporting of inter-state supplies under Table 3.2 of GSTR-3B; and
5. Disclosure requirements under Ind AS 24 for aggregating vs. separately reporting related party transactions.

1. Consumer Protection Authority fines 24 coaching centres Rs. 77.6 lakh for misleading ads; urges compliance with Guidelines

1.1 Introduction

In a significant move to uphold consumer rights and promote transparency in the education sector, the Central Consumer Protection Authority (CCPA) vide. Press Release dated April 17, 2025, has issued strong directives to coaching centres, mandating strict compliance with the Consumer Protection Act, 2019 and the Guidelines for the Prevention of Misleading Advertisements in the Coaching Sector, 2024.

Taking action against deceptive promotional practices, the CCPA targeted institutes offering services for prestigious examinations such as UPSC Civil Services, IIT-JEE, and RBI. It issued 49 notices, imposed a total monetary penalty of Rs 77.60 lakhs on 24 coaching centres and directed the discontinuation of misleading advertisements and unfair trade practices.

1.2 Mandatory disclosures to ensure transparency in Coaching Advertisements

The Authority has emphasized that all coaching centre advertisements must be accurate, clear, and free from misleading claims or the concealment of material information from consumers. The coaching centres must disclose key details in their advertisements, including the student’s name, rank, course type, and whether the course was paid or free.

Additionally, coaching centres are strictly prohibited from making assurances of guaranteed success. This ensures accountability on the part of coaching centres and promotes ethical advertising practices within the sector.

1.3 Overview of Guidelines for Prevention of Misleading Advertisements in Coaching Sector, 2024

The Guidelines for the Prevention of Misleading Advertisements in the Coaching Sector, 2024, were issued on November 13, 2024. These guidelines prohibit coaching centres from making false or misleading claims/advertisements to promote their services and engaging in deceptive or unfair practices. They represent a landmark step towards promoting ethical advertising in the education sector.

The primary objectives of the guidelines are as follows –

• To prevent student exploitation and ensure they are not misled by false promises or compelled into unfair contracts.
• To promote fair advertising and transparent practices.
• To help students and their families make informed decisions based on accurate and truthful information.
• To supplement existing regulations and strengthen regulatory framework governing advertisements in coaching sector.

1.4 Key issues identified by the Central Consumer Protection Authority

After the declaration of competitive examination results, such as IIT-JEE and NEET, the CCPA observed that several coaching centres were not adhering to the Guidelines for the Prevention of Misleading Advertisements in the Coaching Sector, 2024.

Considering the violation of the Act and the Guidelines, the CCPA recently issued notices to a few coaching institutes relating to the following issues –

• Promises of Guaranteed placement or selection
• Rank assurances in examinations such as JEE/NEET
• Violation of consumer rights
• Misleading advertisements and
• Unfair trade practices, including non-delivery of promised services, admission cancellations without fee refunds, deficiency in service and non/partial refund of fees.

These practices violate various provisions of the Act, including Sections 2(28) and 2(47) of the Consumer Protection Act, 2019, and Guidelines for the Prevention of Misleading Advertisement in the Coaching Sector, 2024.

Earlier, the CCPA had also taken action against coaching centres offering services for competitive exams, including UPSC CSE, IIT-JEE, NEET, RBI, and NABARD. This action reaffirms the CCPA’s commitment to ensuring that no false or misleading advertisements are made in contravention of the Consumer Protection Act, 2019.

1.5 Monetary Penalty of Rs 77.60 lakhs imposed on 24 coaching centres

In a decisive step towards safeguarding consumer rights and enhancing accountability in the coaching sector, the CCPA has, over the past three years, taken action against misleading advertisements, unfair trade practices, and violations of consumer rights by various coaching centres.

In this regard, the CCPA has issued 49 notices, imposed a total monetary penalty of Rs 77.60 lakhs on 24 coaching centres, and directed them to discontinue misleading advertisements and unfair trade practices.

Read the Press Release

2. No penalty under Black Money Act if assessee was only joint holder of foreign asset for administrative purposes: ITAT

The assessee, a resident individual, and his son invested in a fund in Mauritius. The assessee did not disclose these investments in his Schedule FA while filing the return of income. The Assessing Officer (AO) initiated penalty proceedings under the Black Money Act.

The assessee contended that he was not the owner of the foreign asset, and hence, there was no requirement to disclose it in Schedule FA of the income tax returns. Unsatisfied with this explanation, AO levied a penalty for non-disclosure of foreign assets in Schedule-FA.

On appeal, CIT(A) confirmed the penalty order, and the assessee filed an appeal to the Mumbai Tribunal.

The Tribunal held that the assessee was included as a secondary owner for administrative purposes. Thus, the assessee was under the bonafide belief that he was not required to disclose the foreign assets as they belonged to his son. There was no dispute that the son declared 100% ownership of the foreign asset in his income tax return.

Thus, the assessee’s omission to disclose foreign assets was due to a bonafide belief that he is not the owner of the asset. AO relied on the fact that the assessee lent money to his son, who, in turn, used those funds to make investments. However, under the general law, merely because a person purchases certain assets out of borrowed funds, the lender would not automatically become the owner of those assets. The buyer would continue to remain the owner of those assets until it is recovered from him by the lender in accordance with the law in the event of failure of the borrower to adhere to the terms and conditions of the loan.

Further, the said loan transaction took place in India and was duly recorded in the books of both the lender and borrower. Hence, the provisions of the Black Money Act will not extend to the loan transaction entered between the parties in India. Therefore, the tax authorities were not justified in levying the penalty, and accordingly, the penalty was deleted.

Read the Ruling

3. Govt. clarifies that no proposal to levy GST on UPI transactions above Rs. 2,000: Press Release

The Government has confirmed that there is no proposal to levy GST on UPI transactions exceeding ₹2,000, terming such claims as unfounded. It reiterated that no GST applies to P2M UPI transactions since the removal of MDR in January 2020. This was stated in the Press Release dated 18-04-2025.

About the Update

The Government has clarified that there are no proposals to impose GST on UPI transactions above Rs. 2,000, dismissing such claims as baseless. GST is only levied on charges like the Merchant Discount Rate (MDR) for certain payment methods, but since MDR was removed for Person-to-Merchant (P2M) UPI transactions in January 2020, no GST applies to these transactions.

Additionally, the Government continues to support the growth of UPI through an Incentive Scheme targeting small merchants, with allocations of ₹1,389 crore in FY 2021-22, ₹2,210 crore in FY 2022-23, and ₹3,631 crore in FY 2023-24. These initiatives have contributed to India’s leadership in global digital payments, with UPI transaction values growing exponentially, reaching ₹260.56 lakh crore by March 2025.

Read the Press Release

4. GSTN issues advisory on reporting of inter-state supplies under Table 3.2 of GSTR-3B

The GSTN stated that Table 3.2 of Form GSTR-3B will be auto-populated and non-editable from the April 2025 tax period. Taxpayers must use Form GSTR-1, GSTR-1A, or IFF to amend inter-State supply details to unregistered persons, composition taxpayers, and UIN holders. This was issued vide GSTN Advisory, dated 11-04-2025.

About the Update

The Goods and Services Tax Network (GSTN) has issued an advisory stating that Table 3.2 of Form GSTR-3B would be non-editable from the April 2025 tax period. This table auto-populates inter-state supply details made to unregistered persons, composition taxpayers, and UIN holders based on data reported in Form GSTR-1, Form GSTR-1A, or IFF. Therefore, manual edits will no longer be allowed, and Form GSTR-3B must be filed with system-generated values.

Further advised that, any corrections should be made by amending the corresponding values in Form GSTR-1A or through Form GSTR-1/IFF in subsequent periods. The taxpayers should ensure accurate reporting in the respective forms to avoid discrepancies and maintain GST compliance.

Read the Ruling

5. Disclosure requirements under Ind AS 24 for aggregating vs. separately reporting related party transactions

The transparency of related party transactions is a cornerstone of reliable financial reporting under Indian Accounting Standards (Ind AS). These transactions can significantly influence a company’s financial position and performance, necessitating appropriate disclosure to ensure users can understand their nature and impact. Ind AS 24, Related Party Disclosures, provides detailed guidance on how such transactions should be reported.

Under Ind AS 24, entities must disclose the nature of the relationships, the amount and terms of transactions, outstanding balances, and any guarantees involved. A critical issue in practice is whether related party transactions can be aggregated or should be reported separately. The standard allows aggregation only when it does not obscure material information or hinder understanding of the transactions’ effects.

For example, a company entered into related party transactions during FY 2023–24. The total related party purchases amounted to ₹400 crore, out of which ₹50 crore was spent on purchasing raw materials from its holding company. This transaction accounts for 12.5% of the total related party purchases, thereby exceeding the commonly used 10% materiality threshold. As it involves the parent entity and crosses the materiality benchmark, separate disclosure is required under Ind AS 24. Additionally, the company purchased machinery worth ₹8 crore from another related party. Since this is a capital expenditure and fundamentally different from operational purchases, Ind AS 24 prohibits aggregating it with transactions related to goods.

The requirement, therefore, is to analyze each transaction for materiality, type of related party, and nature. For material transactions or those involving key related parties or different transaction categories, separate disclosure is required. This ensures that stakeholders receive a faithful representation of the entity’s financial dealings.

In conclusion, compliance with Ind AS 24 hinges not just on disclosure but on the quality of that disclosure. Improper aggregation can impair the usefulness of financial statements. Careful judgment is essential to ensure clarity and adherence to the standard.

Read the Story