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Compliance Updates
- From the Newsletter "India News", Issue Q4 2025
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An overview of India’s compliance landscape, highlighting recent regulatory updates, procedural reforms, and enforcement trends impacting corporate governance, labour laws, environmental regulations, and reporting requirements for businesses operating in India.
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Company Law Updates
Setting up of 3 (three) new Regional Directorates (“RDs”) and 6 (six) new Registrar of Companies (“ROCs”)
The Ministry of Corporate Affairs (“MCA”) has established 3 (three) new RDs at Chandigarh, Navi Mumbai and Bengaluru; and 6 (six) new ROCs at Delhi, Mumbai, Kolkata, Noida, Nagpur and Chandigarh with effect from 1 January 2026, improving regulatory efficiency and support India’s corporate and Limited Liability Partnership (“LLPs”) landscape.
Relaxation of additional fees and extension of time for filing Financial Statements and Annual Returns for Companies.
MCA has extended the deadline for companies to file their FY 2024–25 Financial Statements and Annual Returns [e- Forms MGT-7, MGT-7A, AOC-4, AOC-4 CFS, AOC-4 NBFC (Ind AS), AOC-4 CFS NBFC (Ind AS), AOC-4 (XBRL)] on the MCA V3 portal until 31 January 2026, with no additional fees, considering the large filing volume and stakeholder challenges.
Ease of Doing Business: Directors/Designated Partners KYC filing now once in 3 (three) years.
MCA has amended the Companies (Appointment and Qualification of Directors) Rules, 2014, notified on 31 December 2025, reducing the frequency of KYC compliance for Directors and Designated Partners. Under the amendment, KYC filings will now be required only once every 3 (three) years, easing the compliance burden for companies and LLPs. Directors/Designated Partners must, however, continue to report any changes in their particulars to the ROC within 30 (thirty) days. The amendment will come into effect from 31 March 2026.
Company secretarial (cs) compliance for Private limited companies
Below is a summary of the compliances that need to be adhered to in the next quarter (January – March 2026):
Particulars |
Due Date |
| Form AOC-4 (Filing of Financial Statements). | 30 (thirty) days from the date of Annual General Meeting.
*Extended due date is 31 January 2026. |
| Form CSR-2 (Report on Corporate Social Responsibility Activities and Expenditure). | 30 (thirty) days from the date of Annual General Meeting (linked to form AOC-4).
*Extended due date is 31 January 2026. |
| Form MGT-7 (Filing of Annual Return). | 60 (sixty) days from the date of Annual General Meeting.
*Extended due date is 31 January 2026. |
| Hold at least 1 (one) Board Meeting in the quarter January 2026 – March 2026. | On or before 31 March 2026 after considering the gap of 120 (one hundred and twenty) days. |
| Making payment towards contribution of CSR Activities, if applicable. | On or before 31 March 2026. |
| Form ECB-2 Return. | In case External Commercial Borrowings (ECB), commercial loans are availed by eligible resident entities from recognized non-resident lenders, such resident entities are required to file Form ECB-2 Return within 7 (seven) working days from the closing date of each month. |
| Form AOC-4 (Filing of Financial Statements). | 30 (thirty) days from the date of Annual General Meeting.
*Extended due date is 31 January 2026. |
| Form CSR-2 (Report on Corporate Social Responsibility Activities and Expenditure). | 30 (thirty) days from the date of Annual General Meeting (linked to form AOC-4).
*Extended due date is 31 January 2026. |
Insolvency and Bankruptcy Code (“IBC”) Updates
Supreme Court: IBC Moratorium doesn’t bar Voluntary Surrender of Corporate Debtor’s Leased Property to Lessor.
On 5 August 2025, Supreme Court in Sincere Securities Pvt. Ltd & Ors v. Chandrakant Khemka & Ors. 2025 INSC 931, held that the IBC moratorium under Section 14(1)(d) of IBC, 2016, does not bar voluntary surrender of leased property during Corporate Insolvency Resolution Process (“CIRP”), if the Committee of Creditors (“CoC”) and Resolution Professional (“RP”) deem retention financially unviable. The act was distinguished from coercive recovery barred by the moratorium, and the Court restored the NCLT’s order, setting aside the NCLAT’s ruling, reaffirming the primacy of CoC’s commercial wisdom.
Supreme Court: CoC Exists Until Resolution Plan is Fully Implemented or Liquidation Ordered
On 26 September 2025, the Supreme Court in Kalyani Transco V. Bhushan Power and Steel Ltd. & Connected Matters 2025 INSC 1165, held that the CoC under the IBC, 2016 does not become functus officio upon approval of a resolution plan by the Adjudicating Authority. The CoC continues to exist until the resolution plan is fully implemented or liquidation is ordered under Section 33 of the IBC, 2016, as clarified by Regulation 18(2) of the CIRP Regulations. The Court emphasized that ending the CoC’s role prematurely would leave creditors vulnerable if the plan fails and reaffirmed the CoC’s ongoing role in monitoring and ensuring realization of dues.
Insolvency and Bankruptcy Board of India (“IBBI”) Amends CIRP Regulations to Strengthen Disclosure on Avoidance Transactions
The IBBI has introduced IBBI (Insolvency Resolution Process for Corporate Persons) (Fifth Amendment) Regulations, 2025 (Amendment Regulations). Under the revised framework:
- RPs must mandatorily disclose all identified avoidance transactions and fraudulent or wrongful trading in the Information Memorandum (“IM”), keep it updated, and share it periodically with the CoC.
- Resolution plans may assign such transactions only if disclosed in the IM and communicated to all prospective applicants before the final submission date.
Labour and Industrial Updates
Delhi Grants 24/7 Operating Exemption to Shops and Establishments (Excluding Liquor Stores)
On 7 August 2025, the Delhi Lieutenant Governor exempted all establishments (except liquor shops) from Sections 14, 15, and 16 of the Delhi Shops and Establishments Act, 1954 removing the need for prior approval for night shifts, working hours, and weekly closures. The exemption is conditional on limits to work hours, safety and transport for night shifts, CCTV installation, written consent from women employees, and full compliance with labour laws. This move aligns Delhi with other industrial states, enhancing business flexibility while safeguarding employee welfare.
Supreme Court Rules That Separate Registrations Do Not Make Units Separate Under EPF Act
In Torino Laboratories Pvt. Ltd. vs. Union of India & Ors., 2025 INSC 849 the Supreme Court ruled that separate registrations under different laws do not make units distinct under the Employees’ Provident Funds and Miscellaneous Provisions Act, (“EPF”) 1952. Entities operating from the same premises can be treated as one for EPF purposes, preventing employers from evading liability by creating multiple entities. The judgment reinforces substance over form in labor compliance and strengthens enforcement of employee social security benefits.
Employee State Insurance Corporation (“ESIC”) Reintroduces SPREE Scheme to Encourage Voluntary Registration
On 1 July 2025, ESIC reintroduced the SPREE Scheme to promote registration of employers and employees under the Employees’ State Insurance Act, 1948. The scheme encourages voluntary registration without retrospective coverage or penalties and will remain in effect until 31 December 2025. Subsequently, on 14 July 2025, ESIC issued a notification directing field officers to monitor registrations under the scheme. Importantly, it prohibits inspections of units covered during the scheme’s operation period.
Environmental Laws
Revised criteria for classification of industries within the ‘White’ category
On 28 July 2025, the Ministry of Environment, Forest and Climate Change (“MoEFCC”) amended its earlier notification to revise the criteria for ‘White’ category industries. Now, units with a Pollution Index (PI) score up to 25 (twenty-five) (earlier 20 (twenty)) are exempt from obtaining consent under the Water Act, 1974 and Air Act, 1981, provided they notify their respective State Pollution Control Board or Pollution Control Committee. A revised list of eligible sectors has also been issued.
MoEFCC Notifies Environment Protection (Management of Contaminated Sites) Rules, 2025 (“EPMCS Rules”)
The Environment Protection (Management of Contaminated Sites) Rules, 2025, notified by MoEFCC, mandate SPCBs to assess suspected contaminated sites and report those exceeding hazardous levels to CPCB. Confirmed sites require public consultation and listing on a central portal. Responsible parties must fund remediation, or SPCBs will act if none are found. A Central Remediation Committee oversees implementation and allows voluntary remediation. SPCBs may levy environmental compensation, which does not exempt remediation costs
Simplified Scheme by Maharashtra Pollution Control Board (“MPCB”) for Auto-Renewal of Consents Based on Self-Declaration
On 13 August 2025, MPCB extended its auto-renewal scheme for Consent to Operate to all industries not requiring Environmental Clearance under Environmental Impact Assessment. Eligible units can renew by submitting a self-declaration confirming compliance and no increase in production or pollution load. Capital investment must not exceed a 30% (thirty percent) increase. Validity: Red – 5 (five) years, Orange – 10 (ten) years, Green – 15 (fifteen) years. Renewals are updated on MPCB’s website within 7 (seven) days.
Consumer Law Updates
Supreme Court Restores Full Enforcement Powers to Consumer Forums, Closing 18 (eighteen)-Year Legal Loophole
On 22 August 2025, in Palm Groves Cooperative Housing Society Ltd. v. Magar Girme, the Supreme Court held that consumer forums have the same enforcement powers as civil courts for both final and interim orders. This ruling closes an 18 (eighteen)-year gap caused by a 2002 amendment and aligns with the Consumer Protection Act, 2019’s objective of ensuring swift and effective consumer redressal.
Bureau Indian Standards
Compulsory use of Standard Mark for various Hand Tools’
The Government of India notified Hand Tools (Quality Control) Order, 2025 (“QCO”) on July 22, 2025, which shall come into force from 1 October 2025, superseding the QCO, 2024. The QCO, 2024 mandates that all hand tools sold in India must bear the Indian Standard Mark and be certified by the Bureau of Indian Standards (“BIS”). Both domestic and foreign manufacturers must obtain a valid BIS license to sell these products in India. Contravention of the provision of this QCO, 2025, shall be punishable under the provisions of BIS Act, 2016.