Volume #17 | IssueNo. 315/2025 | August 2025
Constructive Dissatisfaction
Have you ever felt dissatisfied and unhappy even after achieving something ? Answer could be an YES or a NO depending on how far you want to go. Celebrate every small success, every incremental progress, however tiny, but don’t stop. Just pause and restart. Because beyond that success lies excellence. Be dissatisfied. Ask for more from yourself. That’s the only way to excel, to perfect and break boundaries.
- My driver’s son Harish messaged his first semester marks from Diploma in Mechatroncis. It read 62.5%. My husband and I had convinced him to pursue a Diploma over the usual pre-university course. Knowing his performance in 10th grade, we were delighted with what he had achieved. My husband bought him some sweets, gave him some cash gift and patted him on his back. I asked “Harish, are you happy with your marks ?” expecting him to say YES. I was taken aback when he said “No ma’am I am not all that happy. I want to get more next time. I will do better”. I liked his spirit and his attitude. He worked harder, smarter and in the next semester achieved a 68%. He came beaming with his better results. His ‘dissatisfaction’ with himself, his urge to score higher, belief in himself and his progressive attitude helped him excel.
- Describing him as a ‘Sore loser’, my son spoke glowingly of this well-known come-back cricketer with whom he used to practise in the neighbourhood cricket camp, years ago. I quizzed what he meant. He recalled how this cricketer would get angry with himself everytime he got out. He would be dissatisfied with his own performance even after scoring his best. That was his self-motivation technique to surpass his standards. This is his secret to his perseverance and finding a place in a highly competitive Indian cricket team after a long hiatus.
- “I could have got a campus placement in my Udupi college but I knew I will not be happy. I wanted to be on my own.” said the young cab driver Anil, a Bcom graduate, all of 22 years. Ironically I was travelling in his cab to record a podcast that was meant to guide and motivate young students from tier 2 and 3 cities to take up Company Secretary course and pursue a profession. And here I was, chatting up with him who had maintained a spic and span car and even turned on the air conditioner (most drivers refuse giving some flimsy reason unless you pay more). His confidence, his poise and his professional, positive attitude amazed me. He welcomed the infamous Bangalore traffic and population – without the two, where is my business he asked ? Probing a bit I understood that he was dissatisfied with the thought of working for someone. The entrepreneurial bug had bitten him. As a cab driver, Anil made a decent sum that a fresh graduate would take atleast 2-3 years to reach. This only seemed his first venture. He was very clear when he declared “5 years from now I am clear I will start some business on my own. Something that my mother will be proud of”. I realised it is his ‘positive discontentment’ that is fuelling his goals.
Dissatisfaction is the secret to progress, be it in profession, personal life, health and diet, hobbies and interests, entrepreneurial ventures, community building, social cause and what have you. However, it must not result in a negative feeling, low self-esteem or loss of confidence. Dissatisfaction must be constructive, propelling one towards progress and excellence. Mantra for this is question status quo!
The most significant regulatory announcement during August, 2025 was passing of the Income Tax Act, 2025 which aligns with the theme of the editorial “Constructive dissatisfaction” (hopefully it is towards economic progress coupled with ease of living !). Other updates in this 315th Samhita are from MCA, SEBI, RBI, IFSC, ESG, DPIIT and GST. For any previous issues of Samhita and the readers’ feedback, please visit http://www.sharadasc.com/resource-center/.
Happy Reading
S.C. Sharada
www.linkedin.com
Regulatory Updates
MCA Updates
MCA vide notification dated August 13, 2025 has amended the Companies (Indian Accounting Standards) Rules, 2015 in consultation with National Financial Reporting Authority. These amendments are aimed at aligning the IND-AS with IFRS. Key amendments have been introduced under Ind AS 7 – Statement of Cash Flows, Ind AS 12 – Income Taxes, Ind AS 101 – First-time Adoption of Indian Accounting Standards, Ind AS 1- Financial Statement Presentation etc. Refer the link below to read highlights and impact of the said amendments.
(Open Highlights of Ind AS amendments)
(Open MCA notification dt August 13, 2025)
MCA vide notification dated August 26, 2025 has amended the form RD-1 for filing of application with the Regional Director. The revised form is effective from September 15, 2025. Key changes introduced in the form are as follows:
- Details of jurisdiction of police station to be provided for the Applicant
- Copy of approved scheme filed in form CAA-11 introduced as new mandatory attachment where purpose selected for the eform is ‘Notice of approval of the scheme filed in Form CAA-11
- A provision has been made to enable LLPs to file this form and details in the form and declaration portion has been updated accordingly
RBI Update
The Companies Act, 2013 permits the Board of Directors to take on record share transfer based on duly stamped and executed share transfer form in SH-4, irrespective of whether a non-resident transferor or transferee is involved. Further, in terms of FEMA regulations, a share transfer involving non-resident party is reported in Form FCTRS subsequent to the approval of share transfer. However, as per the RBI’s instructions to AD Banks that were issued last year, taking on record of such share transfer prior to reporting in FC-TRS would amount to contravention under the FEMA regulations. In the updated instructions to AD Banks, these contradictory provisions have been struck down, bringing in much needed clarity and alignment with the provisions of the Act.
SEBI Update
SEBI has issued Circular dated July 31, 2025 mandating all Regulated Entities to ensure digital accessibility for persons with disabilities in accordance with the Rights of Persons with Disabilities Act, 2016 and related rules. This circular has been issued following the Supreme Court judgment dated April 30, 2025, which held that digital access is an intrinsic component of the right to life and personal liberty.
Key Points from the Circular:
- All SEBI regulated entities must ensure their digital platforms provide full access to persons with disabilities which shall include features such as Indian Sign Language (ISL) videos, closed captioning, descriptive audio, and alternate text for images.
- Digital platforms must adhere to accessibility standards including WCAG 2.1 (or latest version), Guidelines for Indian Government Websites (GIGW), and IS 17802
- Digital KYC/e-KYC processes must include alternatives to accommodate differently abled users
- Implementation timeline:
– Within 1 month: Submit list of digital platforms and compliance report
– Within 45 days: Appoint IAAP certified accessibility professionals as auditors
– Within 3 months: Conduct accessibility audit
– Within 6 months: Complete remediation of audit findings - Annual compliance reporting required within 30 days from the end of each financial year
- All Regulated Entities must designate a Nodal Officer for digital accessibility compliance
- KYC applications from clients with disabilities can only be rejected after review by a designated human officer who has the authority to override automated rejections
- Accessibility requirements must be included in all procurement contracts and RFPs
- The circular applies to all regulated entities including stock brokers, mutual funds, KYC Registration Agencies, stock exchanges, depositories, and clearing corporations
IFSCA Updates
IFSCA has issued a Circular dated 29th July 2025 establishing a comprehensive framework for Transition Bonds. This framework aims to bridge the financing gap for hard-to-abate sectors responsible for 40% of global greenhouse gas emissions, which struggle to access traditional green financing despite their essential role in achieving net-zero targets. IFSCA has labelled “Transition Bonds” as ESG-labelled debt securities enabling high-carbon industries to finance their decarbonization goal.
The circular outlines eligibility criteria, transition plan requirements, disclosure standards, and reporting obligations for issuers of these bonds.
Highlights of the Circular:
- Eligible Activities: Funds must be used for projects classified as “transition” under recognized taxonomies including ASEAN, Australian, EU, Climate Bonds, Singapore-Asia, IEA Technology roadmaps, Japan’s METI, or any taxonomy specified by the Government of India
- Transition Plan Requirements: Issuers must have a credible entity-level transition plan that includes:
– Paris Agreement-aligned decarbonization goals and pathways – limiting global temperature rise to well below 2°C
– Robust decarbonization strategy and action plan – concrete and sector-specific actions to achieve emissions reduction
– Quantified, time-bound greenhouse gas (GHG) reduction targets covering Scope 1 and 2 emissions
– Strong governance with Board-level oversight
– Stakeholder and value chain engagement including suppliers, customers, employees and other actors across the value chain
– Transparency in disclosure of transition strategies, targets, progress and methodologies - Independent External Review: Mandatory appointment of independent external reviewers to verify alignment with the framework, which may be conducted through second-party opinion, verification, or certification
- Comprehensive Disclosure Requirements: Issuers must disclose:
– Detailed transition plan with short, medium, and long-term GHG reduction targets, governance mechanism, broader sustainability strategy
– Materiality of climate related projects and emissions profile
– Science Based Target initiatives (SBTi) for climate transition strategy
– Implementation transparency including CapEx roll out plans, phase-out plan, qualitative & quantitative assessment of GHG emission - Continuous Reporting: Annual reporting required until bond redemption, covering:
– Progress against climate transition strategy, including annual GHG emission reductions, % of CapEx allocation etc.
– Timeline for reporting Scope 3 emissions
– Use of carbon capture technology and carbon offsets for achieving the targets (if applicable)
– Changes to implementation plans, deviations with corrective actions - Guidance on the disclosure requirement: Issuers may refer to International Capital Market Association’s (ICMA) “Climate Transition Finance Handbook” for further guidance and undertake verification of annual disclosures
This framework is a significant step in enabling finance for sectors that need investment to achieve climate goals, particularly in developing economies like India.
IFSCA vide circular dated August 13, 2025 has clarified that the term “foreign currency account with a bank outside India” used in FEMA Regulations includes the account opened with an International Banking Unit (“IBU”) in any of the specified foreign currencies. Accordingly, IBUs may open such accounts for persons resident in India without prior permission of the Authority.
IFSCA vide circular dated August 12, 2025 has issued updated regulatory framework for Global Access in the IFSC. This comprehensive circular extends to Global Access Providers (GAPs), Broker Dealers and clients accessing global markets directly or indirectly through a Global Access Provider. GAPs as defined in the circular covers subsidiaries of Recognized Stock Exchanges set up in IFSC or a Broker Dealer registered with the Authority accessing Global Markets on clientele basis or proprietary basis through direct arrangement with foreign brokers. Thus they form an important part of the IFSC ecosystem by facilitating access to international markets and financial services, enabling cross-border transactions and investments for clients.
The updated framework broadly provides for the following:
- GAP-Obligation to seek authorization
- Net worth requirement
- Fit & proper requirements
- Permitted Clients
- Permitted Products through Global Access
- Responsibilities of GAP
- Segregation of Funds
- Disclosure to Clients
- KYC, AML & TFC norms
- General obligations
- Code of Conduct
- Periodic Reporting
- Fee Structure
IFSCA has issued the following Master Circulars in August 2025:
- Master Circular for Debenture Trustees in the IFSC – To specify the requirements or directions on various provisions pertaining to Debenture Trustees under the CMI Regulations
- Master Circular for Credit Rating Agencies in the IFSC– In order to enable the stakeholders to have access to various requirements including instructions or directions issued under CMI Regulations at one place
- Master Circular for Distributors in the IFSC- To specify the requirements or directions on various provisions pertaining to Distributors under the CMI Regulations
- Master Circular for ESG Ratings and Data Products Providers in the IFSC – To specify the requirements or directions on various provisions pertaining to ESG Ratings and Data Products Providers under the CMI Regulations.
- Master Circular for Investment Advisers in the IFSC- To specify the requirements or directions on various provisions pertaining to Investment Adviser under the CMI Regulations.
- Master Circular for Investment Bankers in the IFSC- In order to enable the stakeholders to have access to various requirements including instructions or directions issued under CMI Regulations at one place.
- Master Circular for Research Entities in the IFSC- To specify the requirements or directions on various provisions pertaining Research Entities under the CMI Regulations.
DGFT Update
The DGFT, vide Notice dated August 26, 2025, has suspended the Standard Input Output Norms (SION) for a wide range of food and related products, including confectionery, biscuits, starch, tea bags, edible oils, namkeens, amongst other goods and instead claim input duty exemption benefits under the Advance Authorisation scheme through the applicable provisions of the Foreign Trade Policy. This move streamlines export facilitation while allowing exporters to continue availing duty-free import benefits through flexibility in input output mapping.
Continuity through Advance Authorisation: Even though SION norms stand suspended, exporters of the listed food and related products can seamlessly shift to claiming duty-free import benefits under Para 4.03(b) provisions of the FTP.
Flexibility in Input-Output Mapping: Instead of relying on pre-fixed SIONs, exporters can now apply on a case-by-case basis for Advance Authorisation, ensuring input-output requirements are better aligned with their specific production processes.
No Break in Export Benefits: The suspension is procedural and does not withdraw benefits. Exporters remain eligible for input duty exemption, ensuring competitiveness in international markets is not compromised.
Source credits- J the App by Justidt Solutions P Ltd (https://justidt.com/)
Others
The Department for Promotion of Industry and Internal Trade (DPIIT) has recently issued the ‘Cookware, Utensils and Cans for Foods and Beverages (Quality Control) Order, 2025’ on August 21, 2025. This order supersedes the previous one from 2024.
Key Points:
- Starting from October 01, 2025, domestically manufactured or imported cookware, utensils, and cans for food and beverages must bear the Standard Mark under a license from the Bureau of Indian Standards.
- Exemptions exist for goods manufactured for export, limited imports for research purposes, certain MSMEs meeting specific criteria, and goods filled with materials upon import.
- Manufacturers certified by the Bureau or those with pending certification before the implementation date can continue selling their goods for up to six months post-implementation by declaring to the Bureau.
Source credits- J the App by Justidt Solutions P Ltd (https://justidt.com/)
The Labour Commissioner of Karnataka vide notice dated August 21, 2025 has directed that Labour Commissioners shall conduct a survey to assess if Employer of a workplace has duly constituted the Internal Complaints Committee as required under the POSH Act, 2013. Further, if no such Committee has been constituted, necessary action shall be taken as per the Act. It has been directed to complete such survey within a period of 6 weeks from the date of notice.
ESG Updates
A Parliamentary panel has recommended that the Ministry of Corporate Affairs (MCA) establish a dedicated ESG oversight body to curb greenwashing and penalize misleading sustainability claims. The committee emphasized that while Section 166(2) of the Companies Act provides a general mandate, explicit legislative provisions are needed to make ESG integration a non-negotiable responsibility for company boards. Such a framework would shift ESG from being a disclosure exercise to a core element of corporate governance and strategic accountability.
The panel further proposed sector-specific ESG guidelines, targeted support for MSMEs, and statutory amendments to the Companies Act, 2013, to embed sustainability into directors’ duties. These recommendations form part of the government’s action taken report on the Standing Committee on Finance’s 10th report concerning the “Demands for Grants (2025-26) of the MCA” highlighting the growing emphasis on ESG as a pillar of responsible business conduct in India.
The Global Reporting Initiative (GRI) has launched two new sustainability reporting standards—GRI 102: Climate Change and GRI 103: Energy to drive corporate accountability and accelerate climate action. These standards promote transparency through alignment with established frameworks like the GHG Protocol and are designed to integrate with IFRS S2 disclosures.
GRI 102: Climate Change emphasizes science-based emissions reductions as the cornerstone of mitigation efforts. It sets out clear disclosure expectations aligned with global climate goals and includes ‘just transition’ metrics to capture the social impacts of climate strategies—especially on workers, Indigenous Peoples, and communities.
GRI 103: Energy offers a comprehensive view of corporate energy impacts, focusing on the use of renewable and non-renewable sources, decarbonization plans, and energy efficiency outcomes. It positions responsible energy management as essential to any climate strategy.
Both standards are aligned with authoritative global instruments, including the Greenhouse Gas Protocol, enabling a more streamlined and coherent reporting experience for companies. Notably, GRI 102 complements the IFRS S2 standard, allowing for integrated disclosures of climate-related risks and opportunities.
India and the United Nations have jointly launched the UN-India Global Capacity-Building Initiative, a new framework designed to accelerate Sustainable Development Goal (SDG) implementation across the Global South. The initiative seeks to connect Indian institutions, expertise, and development models with partner countries to strengthen cooperation and share best practices. The formal launch took place in New Delhi, hosted by India’s Ministry of External Affairs, signalling a step toward positioning India as a key contributor to global development efforts.
The program will support diverse areas, including digital health platforms, fortified food supply chains, enhanced statistical capacity for census operations, and vocational and technical education. It builds on India’s longstanding Indian Technical and Economic Cooperation (ITEC) Programme and is complemented by the newly created UN India SDG Country Fund, with seed funding from the Gates Foundation. By leveraging these resources, the initiative aims to scale sustainable solutions and promote South-South cooperation, strengthening collective progress toward achieving the SDGs.
The Global Reporting Initiative (GRI) has opened a global public consultation on its proposed Textiles & Apparel Sector Standard, aimed at strengthening transparency and accountability in one of the most environmentally and socially significant industries. The consultation, open until 28 September 2025, invites feedback from stakeholders on the draft standard’s clarity, feasibility, relevance, and completeness. It applies to organizations across the textiles, clothing, footwear, and jewellery value chain—from production and manufacturing to wholesale and retail—covering impacts up to the point of sale.
The draft standard tackles long-standing challenges in traceability and oversight of globally dispersed supply chains, which complicate efforts to address key issues such as water pollution from hazardous chemicals, poor labour conditions, and gender-based discrimination. The draft addresses major sector risks including hazardous chemical use, gender discrimination, excessive working hours, and poor labour practices.
Intercontinental Exchange (ICE) has expanded its climate data and analytics capabilities to cover more than five million private companies worldwide, filling a major gap in climate risk analysis for private markets. This offering provides investors and asset managers with consistent, standardized climate risk data across all major asset classes, enabling more informed decision-making. The service integrates Dun & Bradstreet’s extensive global private company data, powered by the reliable D-U-N-S® Number, with ICE’s advanced geospatial intelligence and climate risk models.
Through this integration, users gain detailed insights into physical climate hazards such as flooding, wildfires, hurricanes, extreme heat, and extreme cold, alongside greenhouse gas emissions data across Scope 1, 2, and 3—normalized by revenue—to better evaluate transition risks. When combined with ICE’s existing climate solutions, the dataset allows institutional investors to access real-time hazard monitoring and cross-asset insights. This holistic approach strengthens portfolio-level climate risk management and equips stakeholders with the tools needed to assess both immediate physical threats and long-term transition impacts.
The European Commission has launched a new voluntary sustainability reporting standard for small and medium-sized enterprises (SMEs), offering a streamlined framework to address rising sustainability information demands from financial institutions and larger companies. Developed by EFRAG, the Commission’s sustainability reporting advisor, the Voluntary Standard for SMEs (VSME) is targeted at businesses not covered under the Corporate Sustainability Reporting Directive (CSRD) but increasingly required to share ESG data with corporate partners.
This initiative serves as an interim step before the formal adoption of a delegated act that will establish a voluntary reporting framework. The delegated act will be part of the Omnibus I simplification package, which also proposes limiting mandatory CSRD obligations to companies with over 1,000 employees. By easing compliance pressures while still promoting transparency, the VSME aims to balance SMEs’ reporting capacity with the growing sustainability expectations across the European value chain.
Tax Updates
President has granted assent to the Income-Tax Act, 2025, which will replace the erstwhile Income-Tax Act, 1961, after over six decades of amendments. This new legislation, passed by Parliament on August 12, 2025, aims to modernize India’s direct tax system by simplifying language, enhancing transparency, and reducing compliance burdens without altering existing tax rates or regimes. Key highlights include:
- Structural Simplifications: Reduces sections from 819 to 536 and chapters from 47 to 23, while slashing wordage from 5.12 lakh to 2.6 lakh. Introduces 39 tables and 40 formulas for better clarity.
- Unified Terminology: Replaces the confusing “Assessment Year” and “Previous Year” with a single “Tax Year” concept to minimize errors and disputes.
- Other Provisions: Aligns Alternate Minimum Tax for LLPs, allows nil-TDS certificates for those without liability, and streamlines transfer pricing and loss carry-forward rules.
The Act will take effect from April 1, 2026.
CBDT vide notification dated August 18, 2025 has amended the Income-tax Rules, introducing Rules 3C and 3D under Section 17(2) of the Income-tax Act. These rules establish new income thresholds for exemptions on employer-provided perquisites as follows:
Rule 3C: Sets a salary income limit of ₹4,00,000 for exemptions under Section 17(2)(iii)(c). Employees with salary income exceeding ₹4 lakh per financial year lose exemptions for perquisites like meal coupons, rent-free accommodation, and medical reimbursements, which become fully taxable.
Rule 3D: Establishes a gross total income threshold of ₹8,00,000 for exemptions under Section 17(2)(vi), covering benefits like concessional loans. If gross total income exceeds ₹8 lakh, these benefits are taxable.
GST Update
Previously, taxpayers could claim refunds under the category “On account of Assessment/Enforcement/Appeal/Revision/Any Other Order” (ASSORD) only if the Demand ID had a negative cumulative balance and a “Refund Due” status. This restricted refunds when individual minor heads (components) of a demand showed negative balances but the overall balance was zero or positive, causing issues for taxpayers.
To address concerns of taxpayer and tax officers, the GSTN vide advisory dated August 28, 2025 has informed about the following system updates:
- Expanded Refund Eligibility: Refunds can now be claimed regardless of the Demand ID status, even if the cumulative balance is positive or zero, as long as any minor head has a negative balance.
- Auto-Population: Only negative balances are automatically populated in Form RFD-01 (refund application);positive amounts cannot be claimed.
- Support Resources: A detailed user manual and FAQs will be released soon. For discrepancies or system issues, taxpayers can raise a ticket with the GST helpdesk.
Statutory Compliance Calendar
July 2025
Quote of the day
Restlessness is dissatisfaction and dissatisfaction is the first necessity of progress. Show me a thoroughly satisfied man and I will show you a failure. - Thomas A. Edison
Disclaimer: The contents of this Newsletter are only a summary and has not dealt with any issue in detail. Any action taken or proposed to be taken must be in consultation with professionals and not merely based on the articles / news updates. S. C. Sharada & Associates disclaims all liability on action taken without professional advice.