Weekly Round-up on Tax and Corporate Laws | 26th January to 1st February 2026

This weekly newsletter analytically summarises the key stories reported at taxmann.com during the previous week from Jan 26^th  to Feb 01^st 2026, namely:

1. Highlights of the Finance Bill, 2026
2. FM presents Economic Survey 2025-26; India’s potential growth revised upward to 7%
3. MCA invites public comments on proposed amendments to IEPFA Rules, 2016 to simplify & expedite low-value investor refunds;
4. Govt. notifies the draft Occupational Safety, Health and Working Conditions (Coal Mines) Regulations, 2026;
5. GSTN enhances interest computation mechanism and GSTR-3B functionalities from Jan 2026: Advisory; and
6. Accounting treatment of additional consideration received pursuant to the Advance Pricing Agreement under Ind AS 115.

1. Highlights of the Finance Bill, 2026

The Union Budget 2026 was presented by Finance Minister Nirmala Sitharaman on February 1, 2026. The Finance Bill 2026 dispelled the hearsay by confirming that the Income Tax Act 2025 will take effect from April 1, 2026. The bill decriminalises certain offences by reducing penalties or replacing them with fees. While income tax slabs remain unchanged, the bill offers relief to individual taxpayers by lowering TCS on overseas travel and remittances to 2% and by exempting interest from motor accident claims. These measures, along with an extended period for revising returns and a disclosure scheme for foreign assets, indicate a move toward a more “trust-based” relationship between the state and its citizens.

In the corporate tax sector, the bill proposes reducing the MAT rate to 14% without any MAT credit claim, expanding the “Safe Harbour” threshold for IT firms, and introducing a tax holiday scheme for cloud computing. These measures aim to reduce litigation and attract high-tech investment. However, the government has also taken a firm stance on speculative trading by increasing the Securities Transaction Tax (STT) on futures and options. Additionally, treating share buybacks as Capital Gains ensures that corporate distributions are taxed more fairly. Overall, the Finance Bill 2026 emphasises administrative ease and sector-specific growth rather than broad-based tax reforms.

Read the Budget Highlights

2. FM Presents Economic Survey 2025-26; India’s Potential Growth Revised Upward to 7%

The Finance Minister Smt. Nirmala Sitharaman presented the Economic Survey 2025-26 in Parliament on January 29, 2026. The Survey reviews the performance of the Indian economy in the backdrop of a challenging global environment marked by geopolitical tensions, trade fragmentation and financial market volatility. It notes that despite these headwinds, India remains one of the fastest-growing major economies, supported by strong macroeconomic fundamentals, policy reforms, and sustained public investment.

The Survey provides a comprehensive assessment of developments in growth, inflation, fiscal position, monetary conditions, the external sector, and financial stability, along with a detailed review of sectoral performance across agriculture, industry, and services. It also analyses emerging issues such as manufacturing competitiveness, cost of capital, export performance, climate transition, employment and skill development, and the role of technology, including artificial intelligence, in shaping the economy.

The Economic Survey 2025-26 underlines the need to strengthen domestic growth drivers while building resilience against external shocks. It emphasises the importance of improving state capacity, enhancing productivity, promoting competitive manufacturing and exports, and maintaining policy credibility to sustain growth over the medium term.

Read the Overview of the Economic Survey 2025-26

3. MCA Invites Public Comments on Proposed Amendments to IEPFA Rules, 2016 to Simplify & Expedite Low-Value Investor Refunds

The Ministry of Corporate Affairs, through the Investor Education and Protection Fund Authority (IEPFA), has invited public comments on the proposed amendments to the IEPFA (Accounting, Audit, Transfer and Refund) Rules, 2016. The proposed amendments aim to simplify procedures, reduce documentation, and expedite the refund process for investors, particularly for low-value claims.

3.1 Background and Objective of the Proposal

The proposed amendments form part of IEPFA’s ongoing efforts to make the refund framework more efficient, transparent, and investor-centric. They seek to address long processing timelines and procedural complexities faced by investors in claiming amounts transferred to the Investor Education and Protection Fund under the Companies Act, 2013.

3.2 Scope of Claims Covered

The amendments apply to refund claims relating to unclaimed dividends, shares, matured deposits, debentures, and other eligible amounts transferred to the IEPF. The focus is on easing compliance requirements and improving turnaround time without compromising verification standards.

3.3 Streamlined Framework for Low-Value Claims

A key feature of the proposal is the introduction of a simplified mechanism for low-value claims, to be processed primarily based on verification by the relevant company. Low-value claims are defined as physical shares with a market value of up to Rs 5 lakh, dematerialised shares with a market value of up to Rs 15 lakh, and dividend claims of up to Rs 10,000.

3.4 Reduced Timelines for Disposal of Claims

For eligible low-value claims, the Authority proposes a significantly reduced disposal timeline of 30 days. The refund process would rely solely on the company’s verification report, enabling faster and hassle-free refunds for investors.

3.5 Rationalisation of Documentation and Procedures

The draft amendments also propose rationalisation of documentation requirements, enhanced procedural clarity and clearer responsibilities for companies. These changes are intended to eliminate duplicative compliance requirements, streamline processing, and improve overall efficiency in handling refund applications.

3.6 Conclusion

If implemented, the proposed amendments are likely to substantially reduce delays in IEPFA refunds, especially for small investors with low-value claims. The combination of simplified procedures, shorter timelines, and reliance on company verification may help ease administrative delays and improve certainty and confidence among investors seeking refunds from the IEPF.

Read the Press Release

4. Govt. Notifies the Draft Occupational Safety, Health and Working Conditions (Coal Mines) Regulations, 2026

Section 136 of the Occupational Safety, Health and Working Conditions Code, 2020, (OSH&WC Code) empowers the Central Government to make regulations in relation to mines and dock work. Accordingly, the Central Government vide notification dated January 28, 2026, has notified the draft Occupational Safety, Health and Working Conditions (Coal Mines) Regulations, 2026, prescribed under the OSH&WC Code. The draft regulations apply to all coal mines and extend across India. Objections and Suggestions can be submitted within 45 days from the date of publication in the Official Gazette.  The key highlights of the draft Regulations are as follows:

• Constitution of the Board of Mining Examination – The draft regulations provide for the constitution of a Board of Mining Examination, consisting of the Chief Inspector-cum-Facilitator as the Chairperson and five members possessing a degree in mining engineering. Each member must hold office for 3 years from the date of appointment or until their successor is appointed, whichever is later.
• Qualifications of Chief Inspector-cum-Facilitator or Inspectors-cum-Facilitators – As per the draft regulations, no person must be appointed as the Chief Inspector cum facilitator or Inspector-cum-Facilitator unless such person holds a degree in mining engineering from an educational institution approved by the Central Government.
• Safety Management Plan – Under the draft regulations, the owner, agent and manager of every mine must:

1. 1. identify hazards to the health and safety of the persons employed at the mine to which they may be exposed while at work,
   2. assess the risks to health and safety to which employees may be exposed while they are at work,
   3. follow an appropriate process for identification of the hazards and assessment of risks
   4. record the list of hazards identified and risks assessed, and
   5. make those records available for inspection by the employees.

• Maintenance of Reports, Records and Registers – As per the draft regulations, all reports, records and registers required to be maintained must be kept in interleaved bound paged registers and signed by the concerned competent persons or officials and countersigned by the manager.
• Payment of Fees – The draft regulations provide that any fees payable must be paid through an electronic mode or any other means as specified from time to time by the Chief Inspector-cum-Facilitator.
• Place of Accident Not to Be Disturbed – The draft regulations provide that whenever an accident occurs in or about a mine resulting in loss of life or serious bodily injury to any person, the place of accident must not be disturbed or altered before the arrival of or without the consent of the Chief Inspector-cum-Facilitator or the Inspector-cum-Facilitator to whom the notice of the accident has been given. Further, the place of accident must not be disturbed or altered except where such alteration is necessary to prevent any further accident, to remove the bodies of the deceased, or to rescue any person from danger, or where discontinuance of work at the place of accident would seriously impede the working of the mine.
• Appeal to the Chief Inspector-cum-Facilitator – As per the draft regulations, an appeal against an order made by the Regional Inspector-cum-Facilitator may be preferred before the Chief Inspector-cum-Facilitator, who may confirm, modify or cancel the order. The appeal must be made within 15 days of receipt of the order by the aggrieved person.

Appeal to the Central Government: The draft regulations provide that an appeal against any order made by the Chief Inspector-cum-Facilitator must be made within 20 days of the receipt of the order by the aggrieved person to the Central Government.

Read the Notification

5. GSTN Enhances Interest Computation Mechanism and GSTR-3B Functionalities from Jan 2026: Advisory

The GSTN issued an advisory enhancing interest computation and GSTR-3B functionalities, effective from the January 2026 tax period. Interest will be system-computed considering minimum cash balance, liability breakup will auto-populate from GSTR-1/GSTR-1A/IFF, IGST liability may be paid using CGST/SGST ITC after IGST ITC exhaustion, and interest for delayed/cancelled cases will be recovered via GSTR-10. This was stated in the GSTN Advisory, dated 30-01-2026.

About the Update

The GSTN has issued an advisory informing that, from the January 2026 tax period onwards, certain enhancements have been made in the filing of GSTR-3B. The interest computation in Table 5.1 has been updated to provide the benefit of the minimum cash balance available in the Electronic Cash Ledger from the due date of return filing until the date of tax payment, in line with the proviso to Rule 88B (1) of the CGST Rules, with interest for delayed returns of the January-2026 tax period to be auto-populated in the February-2026 tax period. The system-computed interest will be non-editable downward and will represent the minimum interest payable, while taxpayers may amend the values upward based on self-assessment.

The portal will auto-populate the Tax Liability Breakup Table in GSTR-3B based on document dates reported in GSTR-1, GSTR-1A, or IFF relating to previous tax periods where the corresponding liability is discharged in the current period. Once the available IGST ITC is fully exhausted, the portal will allow payment of IGST liability using available CGST and SGST ITC in any sequence. In cases of cancelled taxpayers, where the last applicable GSTR-3B is filed after the due date, the applicable interest shall be levied and collected through GSTR-10.

Read the Advisory

6. Accounting Treatment of Additional Consideration Received Pursuant to the Advance Pricing Agreement under Ind AS 115

Accounting for additional consideration received pursuant to an Advance Pricing Agreement under Ind AS 115, Revenue from Contracts with Customers, often arises when an entity has rendered services to a related party and the final determination of the arm’s length price occurs in a later period.

For example, an Indian subsidiary of a foreign multinational provided back-office and support services to its parent company on a cost-plus basis, recognising revenue based on a 10% mark-up determined using the best information available at the time. Subsequently, during a transfer pricing audit, the tax authorities and the company entered into an Advance Pricing Agreement (APA), finalising a 15% mark-up. The parent entity remitted a lump-sum payment representing the cumulative shortfall for services rendered in earlier years. This raised a question on whether this additional amount should be recognised as revenue in the current financial year or treated as a prior period error requiring restatement, and what disclosures would be required to explain the transaction.

Ind AS 115 provides guidance for such situations. Revenue is recognised when the entity satisfies a performance obligation by transferring control of the promised goods or services to the customer. When consideration is variable, it is included in the transaction price only to the extent that it is highly probable that a significant reversal of cumulative revenue will not occur. Subsequent changes in the transaction price that relate to performance obligations already satisfied are recognised in the period in which the change occurs. Furthermore, entities are required to disclose revenue recognised in the current period from performance obligations satisfied in previous periods and to explain significant judgements and changes in judgements affecting the amount and timing of revenue.

In the present scenario, revenue for earlier periods was correctly recognised based on the information available at that time and therefore does not constitute a prior period error. The APA represents a resolution of uncertainty regarding the transaction price. Accordingly, the incremental amount received relates to services already rendered and should be recognised as revenue in the current financial year when the right to receive the consideration becomes enforceable. Disclosures should clearly explain that the revenue pertains to prior period services, the nature of the additional consideration, and the significant judgements involved in determining the transaction price and timing of recognition.

Read the Story