Many non-resident Indians (NRIs) those who claimed benefit of lower or nil rate of taxation under the Double Taxation Avoidance Agreement (DTAA) are receiving income tax notice(s) for failing to file Form 10F. The Income Tax Act, 1961, allows NRI taxpayers to declare their income and file ITR by applying for lower or nil rate of income tax (in some cases) under DTAA.

For availing the benefit of lower or nil taxes under DTAA, NRIs must submit a Tax Residency Certificate (TRC) and Form 10F. This form could be filled any time before filing Income Tax Return (ITR). As per the existing Indian tax law, there is no deadline to file Form 10F and it can be filed electronically by all NRIs who may or may not have a PAN card.

Two-third of Rs 43 lakh crore outstanding direct tax demand is "difficult to collect", Income Tax Department has informed a Parliamentary panel. When the Standing Committee on Finance expressed concern over the huge arrears of demand and desired to know the possible steps, including a moratorium, that can be taken to address this, the Chairman of CBDT told the panel that arrears are a cause for concern.

"We have around Rs 43,00,000 crore of arrear demand which is a cause of concern for us. Partly, this is a legacy issue. This arrear pertains to mid-90s also because earlier what used to happen was there was essentially a manual registers that we were keeping," the CBDT Chairman told the panel.

A parliamentary panel has asked the department of revenue to constitute an expert panel to meticulously examine the issue of pending litigation and propose remedial measures at the earliest with 621,000 tax appeals involving Rs 29.79 lakh crore pending at various courts.

The parliamentary standing committee on finance, in its report tabled Wednesday in Lok Sabha, flagged shortage of manpower at the first appellate level. It noted that the cost of litigation to the government was about Rs 108 crore in 2023-24. "The committee also desires that this matter should be addressed with utmost sincerity and urgency," the committee said.

The Central Board of Direct Taxes (CBDT) has clarified that the principal purpose test (PPT) provisions, designed to prevent tax treaty abuse, will apply prospectively only to the double taxation avoidance agreements (DTAAs) that include a PPT clause. It also stated that the PPT will not affect any other treaty provisions that may deny its benefits to taxpayers.

However, experts say that the authorities can still oppose DTAA benefits to taxpayers (companies) involving “grandfathered investments”, which they feel are of genuine tax abuse, by using other anti-abuse rules under the domestic laws, namely general anti-abuse rules (GAAR), specific anti-abuse rules (SAAR), and judicial anti-abuse rules (JAAR).

In a significant decision, the Income Tax Appellate Tribunal (ITAT), Mumbai bench, distinguished between a legal owner (an individual whose name is merely added on purchase of a property, say a spouse or brother) and a beneficial owner (to whom it actually belongs).

The ITAT emphasized that merely having a name on a property title does not necessarily confer ownership if there is clear evidence to the contrary. Thus, on sale of the property, where the proceeds flow solely to the beneficial owner, the individual whose name has been merely added is not obliged to pay tax on capital gains.

Often, when a property is purchased, the name of another family member is added out of ‘love and affection' – such as to provide a degree of security to a spouse.

The total amount of tax revenue locked in litigation for direct taxes stands at Rs 11.83 trillion, with over 71,453 cases pending across the Supreme Court, High Courts, and tax tribunals as of December 31, 2024, Finance Minister Nirmala Sitharaman said on Tuesday in a written reply in Rajya Sabha.

For indirect taxes, 82,011 cases are pending, with a locked revenue of Rs 5.76 trillion as of January 31, 2025.

As per official data, 6,730 direct tax cases are pending in the Supreme Court, with Rs 25,708.2 crore in dispute.

The Central Board of Direct Taxes (CBDT) has invited public input on the Income Tax Bill, 2025, which was introduced in the Parliament on February 13 and is currently under review by a Select Committee. As part of the consultation process, the board has launched an online portal where stakeholders can submit suggestions regarding tax rules and related forms, the Ministry of Finance said in a statement on Tuesday.

The new Income Tax Bill aims to ensure greater transparency, simplify tax compliance, and eliminate outdated provisions from the existing Income-tax Act, 1961. The bill represents a major overhaul of India's tax framework, addressing issues that have evolved over the past six decades.

All offences under the income-tax law, including cases that involve agencies such as the Enforcement Directorate and the Central Bureau of Investigation, have been made compoundable by competent tax authorities if the applicant is not found to be involved in any anti-national or terrorist activity, the central board of direct taxes (CBDT) said on Monday.

However, if the applicant is found involved in such activities, the offence shall be compounded only with the approval of the CBDT chairman.

India's Central Board of Direct Taxes (CBDT) has clarified that exemptions from the Principal Purpose Test (PPT) under Double Taxation Avoidance Agreements (DTAAs) with countries like Mauritius, Cyprus, and Singapore won't interfere with domestic anti-abuse rules.

This clarification is significant, especially since India and Mauritius amended their tax treaty in April 2024 to include the PPT. The PPT aims to prevent large companies from avoiding taxes by scrutinizing business arrangements made purely for tax benefits .

In January, the CBDT had announced that the PPT wouldn't apply to past investments made under certain tax treaties with countries like Mauritius, Cyprus, and Singapore.

Tax authorities are going to unprecedented levels in using the provision of the law that allows it to collect information from different places - and not just the people who pay taxes.

It is happening across businesses and states, with the taxman snooping around for transaction details with organisations in financial services, hospitality, healthcare, real estate, manufacturing, and those linked to telecom and direct-to-home services.

The aim is to collect evidence of tax evasion, misreporting, and racketeering by verifying various dealing records with the claims made by individuals and entities, under the scrutiny of the I-T Department.

If you have donated Rs 5 lakh or more to a lesser-known political party, then the Income Tax Department may also be keeping an eye on you. Recently, tax officials have sent a long list of questions to thousands of individuals who made such donations in the financial year 2020-21.

According to reports, in many cases, the donors gave money through cheques, but they got the same money back in cash, making this process work like money laundering in a way. It is being told that a commission of 1-3% was also taken in such transactions.

The new Income Tax Bill prescribes the existing process for tax authorities to gain access to the digital space or a computer device only during search and survey operations, and it is not aimed to breach the online privacy of common taxpayers even if their case lands into scrutiny, a top I-T department official said Monday.

The powers for such a coercive action "already existed" in the 1961 Act, and these have only been reiterated in the Income Tax Bill of 2025, he said.

The official rejected claims made in some reports and opinion pieces that the tax authorities have been granted "additional" powers to breach the passwords of electronic records, including email, social media handles and Cloud storage space of the taxpayers.


"Such reports are nothing but fear mongering. The tax department is not into snooping of social media accounts or online activities of a taxpayer.

The income tax department has listed such individuals with undisclosed income subject to income tax and accordingly, the Income Tax Assessing Officers (AO) will send tax notices under Section 148A and other appropriate measures to tackle them.
If your income falls into the taxable income bracket and yet you have not filed your Income Tax Return (ITR) in previous years, you might land yourself in trouble as the Income Tax Department has identified individuals who fall under this category of non-filers.
The department has listed such individuals with undisclosed income subject to income tax and accordingly, the Income Tax Assessing Officers (AO) will send tax notices under Section 148A and other appropriate measures to tackle them.

If your income is high but withdrawals and transactions are very low, then the Income Tax Department may have its eyes on you. Income Tax officials are paying attention to cases where there is a big difference between declared income and spending pattern. If a person’s declared income is high, but cash withdrawals or digital spending is low, then it can be considered a sign of undeclared income and investigation may start.

According to CA (Dr.) Suresh Surana, high-income individuals need to ensure that their withdrawals and digital transactions align with their declared income to avoid scrutiny from tax officials. “A significant mismatch between the income report in the tax returns by the taxpayers and their spending patterns, such as low cash withdrawals or minimal digital transactions despite high earnings, may raise concerns about undeclared income, leading to potential scrutiny or tax investigations.”

Mauritius is pressing for amendments to its trade agreement, including Double Taxation Avoidance Convention (DTAC) with India, Foreign and Trade Minister Dhananjay Ramful said. In an interview with PTI Videos at his office in Port Louis, he underscored the need to revisit the Comprehensive Economic Cooperation and Partnership Agreement (CECPA) to restore Mauritius' position as a preferred investment conduit, as foreign direct investment (FDI) inflows from the island nation to India have declined sharply since the treaty's revision in 2016.
"Amendment in DTAC is still under discussion. Two issues, I think, need to be sorted out. From what I've been told, once this is sorted out, then they will sign the protocol," he explained, hinting at unresolved sticking points in the negotiations.

Last month, Union Finance Minister Nirmala Sitharaman tabled the Income Tax Bill, 2025 in Parliament. Once passed in Parliament, the proposed law will replace the existing Income Tax Act, 1961.

With this proposed legislation, which is expected to come into force on April 1, 2026, the government aims to simplify and modernise the tax system. However, some of its provisions have sparked debate. In particular, questions are being raised about the additional powers given to tax officials and their increased access to taxpayers’ digital data.

This expanded enforcement power is outlined in Section 247 of the Income Tax Bill, 2025, which corresponds to the existing Section 132 of the Income Tax Act, 1961, though with expanded coverage.

The new Income-tax Bill proposes to give powers to tax officers to access social media and other digital accounts including online investment, trading and banking accounts, as well as email servers. The new I-T bill has defined “virtual digital space” in the powers to call for information by income tax authorities during surveys, searches and seizures.

It defines a virtual digital space as “any digital realm that allows users to interact, communicate and perform activities” through computer technology.

Sources said the new provision under Section 247 of the I-T Bill to override the access code of a virtual digital space is “only the reiteration of the already existing provision in a simpler language”.

The Income Tax Bill, 2025 was tabled in Parliament during the Budget session. Earlier, it was perceived as an effort to just simplify the language and structure of the Income Tax Act, 1961. But now the details of the Bill are out and it’s now clear that it is just not about a simplification exercise.

One of the newly introduced provisions of the Bill gives tax officials rights to investigate taxpayers’ social media profiles, emails, bank accounts, online investments and trading accounts. In case of tax-evasion suspicion or if they suspect that you have evaded taxes or have any undeclared assets, cash, gold, jewellery, or other valuables, they can launch an investigation, which will spread to tracking social media, emails, and financial transactions. This new provision, part of the new Income Tax Bill, will be effective from April 1, 2026.

Over 30,000 taxpayers have revised their I-T returns or filed belated returns and declared additional foreign assets and income of more than Rs 30,000 crore, Government sources said on Thursday.

In line with its 'trust-first' approach, the Central Board of Direct Taxes (CBDT) had on November 16 last year, launched an awareness campaign under which messages were sent to taxpayers who had not disclosed high-value foreign income or assets in their ITRs for AY 2024-25.

SMSes and emails were sent to 19,501 taxpayers with high foreign account balances or significant foreign income from interest or dividends above a specified threshold.

For decades, agricultural income and sale of farm land has been a subterfuge to escape tax, convert black money into white. Now, a nationwide probe is underway with the income tax (I-T) department homing in on cases in various states where persons and entities have shown agricultural income of Rs 50 lakh or more without owning any land.

The tax office is simultaneously looking into several cases of unrealistic farm income of Rs 5 lakh per acre, where such declarations are inconsistent with the general trends and publicly available data.

Depending on how far the tax office pursues the matter, the exercise could stir up a hornet's nest in certain pockets given the direct and indirect ownership of land by politicians and other influential parties.