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Newsletter

Stay informed and up-to-date with the latest news and insights related to compliance

ricago Newsletter August Edition - 2025

Labour Laws

EPFO CIRCULAR REGARDING FURNISHING ACCURATE GROSS WAGES IN MONTHLY ECR TO AVAIL BENEFIT UNDER EMPLOYMENT LINKED INCENTIVE SCHEME

The Employees’ Provident Fund Organisation (EPFO) released a circular on July 22, 2025 regarding proper declaration of gross wages in the monthly Electronic Challan-cum-Return (ECR) submission by employers.This specific instruction pertains to the Employment Linked Incentive (ELI) Scheme, which incentivizes both employers and employees. In the ELI Scheme, criteria include a restriction for employees whose gross monthly wages exceed ₹1,00,000. This limitation makes the accurate reporting of gross wages in the ECR critical for determining eligibility in the scheme and preventing unintended claims or denials.

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Tax Laws

CBDT PARTIAL MODIFICATION OF PAN INOPERATIVE CONSEQUENCES – RELIEF FOR TDS/TCS DEFAULTS

The Central Board of Direct Taxes (CBDT) issued Circular No. 9/2025, which modifies Circular No. 3/2023 regarding the impact of PAN becoming inoperative under Rule 114AAA of the Income-tax Rules,1962. The earlier circular stated that PANs would become inoperative if not linked with Aadhaar as of 1st July 2023, incurring higher TDS/TCS rates under sections 206AA and 206CC of the Income-tax Act, 1961.

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Corporate Laws

RBI MASTER DIRECTION – RESERVE BANK OF INDIA (NON-BANKING FINANCIAL COMPANY – SCALE BASED REGULATION) DIRECTIONS, 2023.

As outlined in the RBI’s Master Direction on Non-Banking Financial Company Scale Based Regulation (SBR) dated 17th July 2025, the Reserve Bank of India has integrated and refined the regulations governing the Non-Banking Financial Companies (NBFCs) sector. The framework classifies NBFCs into four layers—Base Layer (BL), Middle Layer (ML), Upper Layer (UL), and Top Layer (TL)—based on size, activity, and systemic risk. NBFCs and ICCs, MFI sectors, Factors, and Infrastructure finance companies (IFCs), along with IDF-NBFCs, are all included in the NBFCs category and are therefore subject to the all-encompassing Directions. Each of these categories is subjected to different compliance requirements, which include governance, activity-based compliance, and prudential norms.

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Judicial Insight

DELHI HIGH COURT UPHOLDS NON-COMPETE CLAUSE AGAINST EX-EMPLOYEE IN IT SECTOR

[Varun Tyagi v. Daffodil Software Private Limited, FAO 167/2025& CM APPL.36613/2025,Delhi High Court]

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