As the new Income Tax (I-T) Act, 2025 moves towards implementation from April 1, 2026, the finance ministry is reviewing and simplifying the compliance forms used by charitable institutions.

Debjyoti Das, principal chief commissioner of income tax (exemption), said the new Act has already reorganised exemption provisions into a clearer and more coherent structure, and the accompanying procedures and forms are now being examined.

“There is also another set of people working on the forms. The forms have not yet been modified… I am hopeful that they will come out with something simpler.

India’s corporate tax collection has surged from Rs 4,57,719 crore in 2020-21 to Rs 9,86,767 crore in 2024-25, the Parliament was informed on Tuesday. Minister of State for Finance Pankaj Chaudhary shared the data in the Rajya Sabha in response to a written question, reported IANS.

According to Chaudhary, the RBI’s October 2025 bulletin article “Resilience and Revival: India’s Private Corporate Sector” noted that during the Covid period, despite contraction in sales, lower raw material costs, subdued wage growth, and favorable base effects, net profit at the aggregate level rose sharply by 115.6 per cent, the report added,

Countries must collaborate in tax matters as new financial products emerge and the economies become more digital, Finance Minister Nirmala Sitharaman said on Tuesday. Evolving structures of “beneficial ownership” necessitate continued cooperation between jurisdictions, she noted.

Addressing the 18th Plenary meeting of the Global Forum on Transparency and Exchange of Information for Tax Purposes in New Delhi, Sitharaman underscored the importance of maintaining confidentiality and cybersecurity with utmost care and stated that these challenges cannot be addressed alone by any single country and require coordination, trust, and timely exchange of relevant information.

On November 3, 2025, the Income Tax Appellate Tribunal (ITAT) Bangalore ruled that a taxpayer's tax deduction cannot be denied under Section 11 just because of a clerical mistake made while filing the income tax return (ITR). The ITAT said that the income tax department cannot take advantage of a taxpayers' mistake to deny him a tax exemption which has already been granted under Section 11.

For those who might not know, Section 11 provides a structured tax exemption framework for Charitable and Religious Trusts registered under Section 12AB, allowing income to remain tax-exempt as long as it is used for approved charitable purposes.

Summary of the judgement
Chartered Accountant (Dr.) Suresh Surana says in this case (ITA No.1485/Bang/2025), the assessee is a charitable trust duly registered under Section 12AB, which qualifies it for exemption under Section 11.

On October 31, 2025, the Mumbai bench of the Income Tax Aappellate Tribunal (ITAT) ruled that a taxpayer's claims under the new tax regime could not be rejected due to a delay in filing the Form 10IC, beyond the legal deadline.

This judgement came in the backdrop of a case filed by a taxpayer against the income tax department. He had filed his income tax return (ITR) on February 11, 2021 by declaring an income of Rs 8.7 crore and had opted for the new tax regime under Section 115BAA. However, he failed to file Form-10IC, leading the income tax officer/centralised processing centre (CPC) to deny the concessional tax rate benefits under the new tax regime (Section 115BAA) while processing the ITR.
Feeling aggrieved, the taxpayer submitted an application under Section 154 before CPC but it was turned down. The CPC's decision was later upheld by ld CIT(A). The taxpayer then took the case to ITAT Mumbai.

Intensifying its efforts to curb tax evasion, the Central Board of Direct Taxes (CBDT) has launched the second phase of its “NUDGE” initiative to strengthen voluntary compliance by taxpayers on foreign assets and income. The exercise will begin with around 25,000 high-risk cases identified through Automatic Exchange of Information (AEOI) data for 2024-25.

From November 28, 2025, SMS and email alerts will be sent to the flagged taxpayers, advising them to review and revise their income tax returns (ITRs) for the assessment year 2025-26 by December 31, 2025. Non-compliance may invite severe penalties under the Income-tax Act and the Black Money Act, the tax department said.

Data-Driven Enforcement
The first phase of the exercise will focus on the highest-risk cases, while a second phase starting mid-December will expand the NUDGE campaign to cover additional taxpayers. Large corporates are also being brought on board to sensitise employees, who may have foreign assets that remain undisclosed in their returns.

The finance ministry is reviewing and simplifying the compliance forms used by the charitable institutions for return filings, registration and renewal, a senior official said on Monday.

The new Income Tax Act, 2025, to be effective from April 1, 2026, has already reorganised exemption provisions into a simplified and cohesive structure, and the forms are now being reviewed.

Addressing the PHD Chamber of Commerce and Industry’s (PHDCCI) session on the taxation of charitable institutions and exempt entities, Debjyoti Das, principal chief commissioner of income tax (exemption) acknowledged that the I-T 1961 is complex and fragmented, particularly with regard to exemption provisions.

What did Debjyoti Das say?
He pointed out that shifting provisos, scattered clauses, and repeated piecemeal amendments had created a web of procedural and interpretative difficulties, often leading to frustration for taxpayers, tax professionals, and officers alike. He said that efforts are underway to ease procedural hassles related to registration and late filing of tax audit reports.

The Supreme Court on Tuesday clarified that tax deduction at source on remittances to non-resident entities cannot exceed 10% as specified in various Double Tax Avoidance Agreements (DTAA), and any demand raised by the income tax department beyond this would be inconsistent with the treaty.

Rejecting the income tax department's appeals that wanted higher tax of 20% to be deducted at source (TDS) by various information technology companies like Mphasis, Wipro and Manthan Software Services, the apex court said that the TDS provisions in the Income Tax Act 1961 must be read along with the DTAA for computing the tax liability, and that when the foreign recipient is eligible for treaty benefits, the deduction cannot exceed the 10% cap specified in the DTAA.

The department wanted higher tax of 20% to be deducted at source as these companies had failed to furnish permanent account numbers in terms of Section 206AA of the Income Tax Act.

There’s a high probability that many taxpayers have not received their income tax refund (ITR) filed for the financial year (FY) 2024-25, or assessment year (AY) 2025-26. One must’ve been regularly checking the income tax portal to find any reasons for delay, and yet couldn’t really understand why.

Recently, the chairman of Central Board of Direct Taxes (CBDT), Ravi Agrawal, clarified that many ITRs appear unusual, and that the department is carefully checking any errors in filing. He said 40 percent of more appeals have been settled this year.

While some refunds may get issued earlier, however, large refunds may get delayed due to various discrepancies in the ITR filing, including any arithmetical error, incorrect claim, disallowance of expenditure and deduction claimed beyond the due date, as well as non-validation of taxpayer’s bank account, to cite an example. The ITR verification process is mostly automated.

The good news is that refunds are not very far off. Agrawal said that the remaining refunds should be released by the end of this month or by December.

Income Tax Refunds: Income tax refunds were among the most searched terms in India over the last week. According to Google Trends, people extensively searched for questions like refund delay, income tax refunds, and “when will I receive my income tax refund?” A key reason for this is CBDT Chairman Ravi Agarwal’s recent statement, in which he stated that the department is conducting a detailed investigation into some high-value and red-flagged refund claims. This investigation is causing a temporary delay in the refund process.

Aggarwal clearly stated that all valid refunds will be issued by December. However, public concerns have not been allayed, as “Income Tax Refunds” continues to trend on Google Trends.

81.8 million ITRs filed, but 9.2 million returns still pending processing
According to government data available on the Income Tax Department’s portal: Over 81.8 million ITRs filed, 78.7 million returns verified, but only 69.5 million of these have been processed.

Taxpayers are increasingly getting system-generated intimations under Section 143(1)(a) for discrepancies in returns filed and annual information statement (AIS) or Form 26AS. They must respond by submitting clarifications or file a revised return by December 31.

Non-response to income tax intimations can lead to disallowing of claimed credits or deductions. It may also trigger penalty proceedings for concealment or non-compliance, including fees and interest of Sections 234B and 234C on such outstanding tax dues.

Sandeep Sehgal, partner, Tax, AKM Global, a tax and consulting firm, says the rise in system-generated intimations under Section 143(1)(a) is due to the automated mismatch detection process employed by the income tax department’s Central Processing Centre. “Such notices alert taxpayers and identify the discrepancies as part of enhanced compliance and data validation efforts,” he says.

The Central Board of Direct Taxes (CBDT) has introduced the Capital Gains Accounts (Second Amendment) Scheme, 2025, modernising a 37-year-old scheme to improve taxpayer convenience.

The amendment to the Capital Gains Account Scheme of 1988, effective November 19, extends the scheme to cover gains arising from shifting of industrial undertakings from urban areas to special economic zones (SEZs) under Section 54GA. This provision seeks to promote investments in SEZs by allowing taxpayers to claim exemptions on capital gains. The amendment brings the scheme into the digital era by recognising electronic payment modes, including credit cards, debit cards, net banking, IMPS, UPI, RTGS, NEFT, and BHIM Pay. Electronic statements of account will now be treated similarly to traditional passbooks.

The scheme's scope has been broadened to include any banking company defined under the Banking Regulation Act, 1949, authorising 19 more networks of banks to receive deposits and maintain accounts under the scheme.
"Overall, these changes will facilitate a shift from a paper-driven, cheque-based process to a streamlined, technology-enabled framework for availing of capital gains exemption," said Amit Maheshwari, tax partner, AKM Global.

The Income Tax Department is gearing up for the new and simplified Income Tax Act, 2025, which will come into effect from April 1 next year. CBDT Chairperson Ravi Agarwal recently said that the department will release newly designed ITR forms and related rules by January 2026. These forms are being designed entirely in accordance with the new tax system, giving taxpayers time to understand the changes and update their systems, according to him.

Aggarwal stated that the department is working on developing new forms and a compliance framework. During an event at IITF, he said: “We are in the process of designing forms and rules. We are working towards putting this in place by January so that taxpayers have sufficient time to adapt their processes within their systems.”

The new law and new forms will come into effect on April 1, 2026, replacing the existing Income Tax Act, 1961. This change will have the potential to make tax filing more digital, easier and clearer in the coming years, the government claims.

New ITR Forms – What will be the major changes?
These ITR forms, which come with the new law, mark a major shift in the country’s tax system. They have been specifically designed to make filing easier for ordinary taxpayers, salaried individuals, pensioners, and small businesses.

Chairman of the Central Board of Direct Taxes (CBDT) Ravi Agrawal on Monday said the Income-Tax Department is analysing certain refund claims, particularly those identified as “high-value” or red flagged due to claims of specific deductions. This process has led to a temporary delay in issuing refunds, though legitimate payouts are expected by December.

Asked about the delay, Agrawal said, “We have also written to the taxpayers to file a revised return in case they have forgotten something.”

The Income Tax department will notify ITR forms and rules under the simplified Income Tax Act, 2025 by January, officials said. The new law, which replaces the six-decade-old Income Tax Act of 1961, comes into effect from the next fiscal beginning April 1, 2026. The intent is to make tax compliance simpler and more taxpayer-friendly, Central Board of Direct Taxes (CBDT) chief Ravi Agrawal said on Monday.

“We are in the process of designing forms and rules. We are working towards putting this in place by January so that taxpayers have sufficient time to adapt their processes within their system,” Agrawal told reporters after launching the Taxpayers’ Lounge at the India International Trade Fair (IITF).

On October 31, 2025, the Income Tax Appellate Tribunal (ITAT) Bangalore provided relief to Mr. Israni, a senior citizen, by removing the disallowance of the acuisition cost for a house property in Bengaluru that he jointly sold with his wife for Rs 8 crore. Out of this Rs 8 crore, he is entitled to Rs 4 crore, as his wife had a 50% share in this property.

This case began when Mr. Israni filed his income tax return (ITR) for AY 2022-23 on June 16, 2022 reporting a total income of Rs 35 lakh (35,67,355). This ITR was processed under Section 143(1) on August 16, 2022 where his income calculations were accepted as submitted .However, his case was chosen for scrutiny under CASS, leading to issuance of tax notices under Sections 143(2) and 142(1).

Responding to the tax notice, Mr. Israni made submissions on various dates throughout the assessment process. However, the tax officer noted that during the year under consideration, Mr. Israni sold a house property located in Bangalore for Rs 4 crore (4,02,00,000) (50% of Rs 8 crore or 8,04,00,000).

On October 27, 2025, the Income Tax Appellate Tribunal (ITAT) Mumbai ruled that short term capital gains (STCG) from transferring development rights to a builder under a registered agreement, should be taxed in the individual homeowner’s hands rather than the housing society’s.


This ruling came about after a case was filed by the RBI Employees Bhagvati Co-op. Housing Society Ltd which is a Co-operative Housing Society registered under the Maharashtra Co-operative Housing Society Act 1960. The housing society filed this case against the income tax department after they added Rs 5 crore (4,97,63,657) to their STCG income and slapped on a penalty of Rs 1.5 crore (1,53,76,971).

Chartered Accountant Suresh Surana said to ET Wealth Online that in this case of ITO vs RBI Employees Bhagvati Co-operative Housing Society Ltd., the assessee, a residential society in Mumbai, entered into a redevelopment agreement with a developer.

India’s direct tax collections have maintained steady momentum, with the latest data indicating a year-on-year increase in net collections (as of November 10, 2025), according to latest data from the Central Board of Direct Taxes (CBDT). The rise in tax collections underscores resilient corporate profitability, expanding individual tax base and improved compliance.

According to the latest numbers for FY 2025-26 (up to November 10, 2025), net direct tax collections have touched Rs 12.92 lakh crore, compared with Rs 12.07 lakh crore in the same period last year. This reflects a growth of 7 per cent year on year, even as refunds have fallen sharply.

Corporate tax leads the rise
Corporate tax (CT) collections have shown strong performance this year.
Gross corporate tax collections rose from Rs 6.60 lakh crore in FY25 to Rs 6.91 lakh crore in FY26.

Mr. Vashistha, a retired employee of the State Bank of India from Jaipur, had to file a case in the Income Tax Appellate Tribunal (ITAT) after the income tax department denied him a higher tax exemption of Rs 25 lakh for leave encashment. What happened here was Mr. Vashistha got Rs 13 lakh as part of his retirement benefits (leave encashment) and he claimed tax exemption for the entire amount. For the uninititated, at present up to Rs 25 lakh is tax exempt for leave encashment, but earlier it was Rs 3 lakh.

On November 3, 2021, the income tax department issued him a Section 143(1) notice denying the higher tax exemption of Rs 25 lakh for leave encashment. Although he challenged this tax notice in CIT (A), he ended up losing the case there.

The ITAT Jaipur noted that the only submission put forth by Vashistha’s authorised representative was that he received Rs 13 lakh (13,05,810) as leave encashment benefit under Section 10(10)AA of the Income Tax Act, 1961.

A food product company in Andhra Pradesh, an infrastructure company in Maharashtra and a beverages firm in Punjab all have one thing in common: Tax cases that have been pending in the high court for over 10 years, without a single hearing having taken place.

And they are not alone.

There were at least 4,000 cases pending for a decade or longer where a hearing had yet to take place, shows a Business Standard analysis of figures from the think-tank and research institution DAKSH, which has created a database with information from 23 out of 25 high courts on tax cases for the two decades from 2000 to 2021.

An analysis of 320,000 unique cases showed that more than 12,000 tax cases were pending for a decade or more (33.7 per cent), without a hearing and that over 56,000 were pending overall.