Weekly Round-up on Tax and Corporate Laws | 22nd to 27th September 2025

This weekly newsletter analytically summarises the key stories reported at taxmann.com during the previous week from Sep 22nd to Sep 27th, 2025, namely: 

1. Govt. operationalises nationwide GSTAT with e-Courts Portal for speedy dispute resolution
2. CBDT waives interest on demand raised due to disallowance of Section 87A rebate on income taxable at special rate
3. Income from sale of seeds produced by getting them cultivated through farmers is agricultural income: HC
4. RBI streamlines norms for settlement of claims related to deceased customers of banks
5. E-office generated ‘Issue Number’ will be deemed as DIN for communications by CBIC officers: Circular
6. GSTN introduced changes in IMS to keep specified records pending for one tax period
7. Accounting for CSR expenditure and handling of CSR assets in capital projects and donations. 

1. Govt. operationalises nationwide GSTAT with e-Courts Portal for speedy dispute resolution 

The CBIC issued a press release announcing the operationalisation of GSTAT with a Principal Bench in New Delhi and 31 State Benches. It highlighted simplified procedures, digital filings, and an e-Courts Portal for online appeals, hearings, and case tracking. This was stated in Press Release, Dated 25-09-2025. 

About the Update 

The CBIC has issued a press release announcing the launch of the Goods and Services Tax Appellate Tribunal (GSTAT) in New Delhi by Union Minister of Finance and Corporate Affairs, Smt. Nirmala Sitharaman. GSTAT has been established as a specialised, nationwide forum to ensure fair, efficient, and transparent resolution of GST disputes. The Tribunal is structured to deliver jargon-free decisions in plain language, with simplified formats and checklists, digital-by-default filings, virtual hearings, and time standards for listing, hearing, and pronouncement. It functions through a Principal Bench in New Delhi and 31 State Benches across 45 locations, with each Bench comprising two Judicial Members, one Technical Member from the Centre, and one Technical Member from the State, ensuring balanced judicial and technical expertise along with cooperative federalism in decision-making. 

The press release also highlights the launch of the GSTAT e-Courts Portal, developed in collaboration with GSTN and NIC, which allows taxpayers and practitioners to file appeals online, track the progress, and participate in hearings through digital mode. To facilitate orderly submissions, staggered filing of appeals is permitted until 30-06-2026, supported by comprehensive guidance that includes FAQs, explanatory notes, and instructional videos covering registration, filing of appeals, digital hearings, and case tracking. GSTAT aims to minimise legal frictions, provide consistency in interpretation, ensure predictability in outcomes, and strengthen trust between taxpayers and the tax administration, thereby promoting ease of doing business, fair dispute resolution, and taxpayer-centric governance. 

Read the Press Release 

2. CBDT waives interest on demand raised due to disallowance of Section 87A rebate on income taxable at special rate 

The Central Board of Direct Taxes (CBDT) has issued a circular to waive the demand raised upon the taxpayers due to the disallowance of the section 87A rebate on the income that is chargeable to tax at a special rate. 

The provisions of section 115BAC(1A) of the Income-tax Act, 1961, are subject to the other provisions of Chapter XII of the Act. Therefore, incomes chargeable to tax at special rates as specified under various provisions of Chapter XII of the Act are not included while determining the chargeability to tax under section 115BAC(1A). 

The Board has noticed that in certain cases, the returns have been processed, and a rebate was allowed under section 87A to taxpayers on incomes chargeable to tax at special rates. In such cases, rectifications have to be carried out to disallow such a rebate, which has been incorrectly allowed. Such rectifications will result in demands being raised. If the payments of such demands raised are delayed, then the same is liable for charging interest under section 220(2). 

Therefore, to mitigate the genuine hardship arising to such taxpayers on account of interest payable under section 220(2), the CBDT directs that the interest payable under section 220(2) shall be waived in such cases where the payment of the demands raised is made on or before 31.12.2025. 

Read the Circular 

3. Income from sale of seeds produced by getting them cultivated through farmers is agricultural income: HC 

The assessee was a company engaged in the business of research, production, and sale of agricultural/hybrid seeds. It entered into agreements with farmers to utilise their lands, under which the farmers performed normal agronomic practices for the production of seeds from foundation seeds supplied by the assessee under its supervision and control. 

For the relevant assessment year, the assessee claimed exemption under section 10(1). During the assessment proceedings, the Assessing Officer (AO) disallowed the exemption on the ground that the assessee was not directly involved in agricultural activity. On appeal, the CIT(A) allowed the assessee’s claim. The Tribunal also allowed the claim, and the matter reached the High Court.  

The High Court held that the parent seeds were produced through agricultural cultivation. The company undertook cultivation under its supervision and at its own cost and risk. 

The production of these seeds and the farmer, wherein under the supervision, technical guidance, and control of the company, is in agreement for the production of the Hybrid seeds, since they have a direct nexus with the land owned by it or on the leased lands by supplying seeds to the farmers and getting them cultivated under its supervision and control and the company plays an active role of action of monitoring and nurturing the plants by the assessee cultivated by the farmers.  

Although the assessee may not be directly involved in the cultivation activity, it was indirectly involved through farmers in the production of hybrid seeds yielding high yields for various types of hybridisation, which were used in agriculture to produce high-yielding seeds. Therefore, the assessee was indirectly involved in the said activity. 

Accordingly, the Tribunal was justified in allowing deduction under section 10(1) of the Income-tax Act by taking the income of the assessee as agricultural income. 

Read the Ruling 

4. RBI streamlines norms for settlement of claims related to deceased customers of banks 

The RBI vide Circular dated September 26, 2025, has issued revised directions to simplify and standardise the settlement of claims for deceased bank customers. These updated norms are designed to eliminate inconsistencies in bank practices, ensure uniformity in documentation and enhance overall customer experience. By providing clear guidelines for claims related to deposit accounts, safe deposit lockers, and articles in safe custody, the RBI aims to streamline the claims process, making it faster, more transparent, and more convenient for claimants. These directions shall apply to all commercial and cooperative banks. 

a) Background and Rationale 

The existing guidelines require banks to adopt a simplified procedure for settling claims made by survivors/ nominees/ legal heirs. However, divergent practices continue to be followed by banks. On August 6, 2025, the RBI, in a press release, proposed uniform procedures for legal heirs to access bank accounts and safe deposit lockers of deceased customers.  

Accordingly, the RBI decided to review the existing guidelines and issue revised directions to streamline the procedures and standardise the documentation, with the objective of enhancing customer service. In this regard, the RBI has issued the ‘Settlement of Claims in respect of deceased customers of Banks’ Directions, 2025.  

b) Simplified procedure for settlement of claims 

In cases where the accounts of deceased depositors do not have a nominee/survivorship clause, banks must adopt a simplified procedure for settling claims if the aggregate amount payable, including accrued interest as of the application date, is less than the threshold limit.  

The ‘Threshold limit’ means Rs 5 lakh, in case of a cooperative bank and Rs 15 lakh, in case of any other bank or such higher limit as may be fixed by the bank, including a cooperative bank. The banks must settle claims as follows: 

• For claims up to Threshold limit: Settlement must be made using basic documents such as a claim form, death certificate of deceased depositors, a letter of no-objection, a legal heir certificate issued by a competent authority and a bond of indemnity signed by the claimants. 
• For claims above the Threshold limit: Additional documents would be required, such as a succession certificate or a legal heir certificate issued by a competent authority, or an affidavit sworn before a Notary Public/Judge/Judicial Magistrate regarding the legal heirs of the deceased depositor, by an independent person. 

c) Settlement of claims not falling under the Simplified procedure 

For claims outside the simplified procedure, banks must settle claims as under: 

• For claims involving ‘Will’ without any dispute: Banks must settle claims involving ‘Will’ left behind by a deceased depositor based on Probate of Will/Letter of Administration, as applicable, in addition to the claim form, death certificate of deceased depositor and an officially valid document of the claimants.  
• Cases involving contesting claims/ disputes: In case of contesting claims or disputes amongst the legal heirs and/or the beneficiaries named in the Will of deceased depositor, banks must settle claims based on Probate of Will/Letter of Administration or Succession Certificate or Court Order/decree, as applicable. Also, if there is an order from the Court restraining the bank from making the payment, the claim must not be processed during the period the order is in force.  

d) Settlement of claims for safe deposit lockers and articles in safe custody kept by the deceased customer

If a sole locker hirer nominates an individual to receive the contents of the locker upon their death, a bank must grant access to the locker to such nominee, with the liberty to remove the contents of the locker.  

Where a locker is hired jointly with the instructions to operate it under joint signatures, and the locker hirers nominate any other individual, in the event of the death of any of the locker hirers, the bank must give access of the locker and the liberty to remove the contents jointly to the nominees and the surviving hirers.  

e) Standardisation of procedure for submission of claims 

Banks must use standardised forms for receiving claims and other documents as per the prescribed formats. These forms and documents, required for the settlement of claims w.r.t deposit accounts/safe deposit lockers/articles in safe custody kept by a deceased customer must be made available at all branches and on the bank’s website for the convenience of claimants. 

Additionally, banks must display on their websites – 

• All documents to be submitted by a claimant and 
• The procedure to be followed for the settlement of claims 

Once a claimant submits all the required documents for processing of the claim, the bank must issue a confirmation to the claimant. However, in case of any pending or incomplete documents, the bank must inform the claimant about the list of such documents while acknowledging the receipt of the claim.  

Also, banks may provide an online facility for lodging claims through their websites. Upon a claimant uploading the claim form along with the required documents, banks must issue an acknowledgement/confirmation through appropriate channels and provide claimants the option to track the status of their claims.  

f) Time limit for settlement of claims 

Banks must settle claims relating to deposit accounts of a deceased customer within a period not exceeding 15 calendar days from the date of receipt of all the required documents associated with the claim. For safe deposit lockers/articles in safe custody, banks must, within 15 calendar days of receiving all the required documents, process the claim and communicate with the claimants to arrange a date for preparing an inventory of the lockers/articles in safe custody.  

g) Compensation for delay in settlement of claims 

Where any deposit-related claim is not settled within 15 calendar days from the date of receiving the complete set of documents associated with claim, then the bank must communicate the reasons for the delay to the claimants.  

In the case of delay, the bank must pay compensation to the claimants in the form of interest at a rate not less than the prevailing bank rate + 4% p.a. on the settlement amount due for the period of delay. Further, in cases of claims relating to safe deposit lockers/articles in safe custody, the bank must pay compensation to the claimants at the rate of Rs 5,000 for each day of delay.  

Read the Circular 

5. E-office generated ‘Issue Number’ will be deemed as DIN for communications by CBIC officers: Circular

The CBIC issued a circular clarifying that the eOffice-generated ‘Issue Number’ will be deemed as DIN for communications. It provided an online utility for verification and modified earlier circulars to align with this framework. This was stated in Circular No. 252/09/2025 – GST, Dated 23-09-2025. 

About the Update 

The CBIC has issued a circular regarding the verification and quoting of Document Identification Number (DIN) in communications dispatched through eOffice. An online utility (https://verifydocument.cbic.gov.in) is now functional, allowing verification of the unique electronically generated ‘Issue number’ on communications sent via the public option in eOffice. The utility confirms the Issue number along with file number, date of issue, type of communication, issuing office, and masked recipient information. Quoting a separate DIN on such communications is not required, as the eOffice Issue number shall be deemed the DIN and considered a valid communication. Circular No. 122/41/2019-GST dated 05-11-2019, Circular No. 128/47/2019-GST dated 23-12-2019, and Circular No. 249/06/2025-GST dated 09-06-2025 are modified to this extent. 

Communications dispatched using the eOffice public option do not require a separate DIN, while other communications not using the public option or lacking a verifiable Reference Number (RFN) from the GST portal must continue to quote the DIN generated through the DIN utility. 

Read the Circular 

6) GSTN introduced changes in IMS to keep specified records pending for one tax period 

The GSTN issued an advisory introducing changes in the IMS to allow specified records to be kept pending for one tax period. It also enabled reporting of ITC actually availed or reversed and added optional remarks for supplier visibility. This was stated in GSTN Advisory, Dated 23-09-2025. 

About the Update 

The GSTN has issued an advisory on new updates in the Invoice Management System (IMS) designed to simplify compliance. Taxpayers can now keep certain specified records pending for a limited period—one tax period, which is one month for monthly taxpayers and one quarter for quarterly taxpayers. Eligible records include credit notes or upward amendments of credit notes, downward amendments of credit notes where the original was rejected, downward amendments of invoices or debit notes where the original invoice has been accepted and GSTR-3B filed, and ECO-document downward amendments under similar conditions. 

A new facility has also been introduced to declare the amount of Input Tax Credit (ITC) actually availed and, if applicable, reversed—either partially or fully—for the specified records. Additionally, taxpayers can optionally save remarks while taking reject or pending actions on records, which will be visible in Form GSTR-2B and the Outward Supplies dashboard for supplier reference. 

These changes will be effective from the October tax period and will apply prospectively only to records filed by suppliers after the rollout. The due date for keeping records pending is determined by the tax period in which the relevant documents were communicated by the supplier. 

Read the Advisory 

7. Accounting for CSR expenditure and handling of CSR assets in capital projects and donations 

Companies often discharge their Corporate Social Responsibility (CSR) obligations through activities such as creating capital assets, making donations, or distributing goods and services. The accounting treatment of such CSR expenditure is guided by the Companies (CSR Policy) Rules, 2014 (as amended in 2021), the Technical Guide on Accounting for Expenditure on CSR Activities issued by ICAI, and relevant Ind AS provisions. 

While Ind AS 16, Property, Plant and Equipment (PPE), permits capitalisation of costs directly attributable to bringing an asset to its intended use, this principle does not extend to CSR activities. Since CSR expenditure does not generate future economic benefits for the company, related assets cannot be capitalised in its books. Instead, the expenditure is charged to the Statement of Profit and Loss as CSR expense. Further, the 2021 CSR amendments require that any capital asset created with CSR funds must vest with eligible entities such as Section 8 companies, registered public trusts or societies with CSR registration, project beneficiaries, or a public authority. For assets created in earlier years and shown as PPE of the company, the rules require transfer to an eligible entity within the prescribed period and derecognition from the company’s balance sheet. 

For example, when a company spends CSR funds on constructing a community health center to be run by a Section 8 company, the amount incurred qualifies as CSR expenditure and is charged to the Statement of Profit and Loss, not capitalised, even though it relates to construction of a capital asset. Similarly, where a company had earlier built a vocational training center and shown it as a PPE in its books, it was subsequently required to transfer the center to a registered public trust and derecognise it, ensuring compliance with the amended CSR framework. 

CSR obligations may also be met through donations in kind, such as distribution of goods manufactured by the company. In such cases, Ind AS 2, Inventories, requires valuation at cost or net realisable value, whichever is lower. The goods are derecognised from inventory, and the corresponding value, along with any taxes like GST borne by the company, is recognised as CSR expenditure in the Statement of Profit and Loss at the time control passes to beneficiaries. 

Thus, whether CSR spending takes the form of constructing assets, transferring earlier capitalised assets, or donating goods, it must be recognised as an expense in the Statement of Profit and Loss. No CSR-related assets remain in the company’s books, ensuring compliance with the Companies (CSR Policy) Rules and the Ind AS framework. 

Read the Story