August 2026 – At a Glance

• The RBI retained the policy repo rate at 5.25% and maintained a neutral stance, while proposing reforms concerning loan pricing, UCB licensing and recovery-agent conduct.
• The RBI’s draft Data Governance Guidance for regulated entities reached an important consultation stage, with comments invited until 17 August 2026.
• SEBI introduced measures concerning Online Bond Platform Providers, InvIT cash-flow calculations and commodity-derivatives stress testing.
• SEBI proposed a framework for Depository Receipts against units of REITs and publicly listed InvITs, potentially providing an additional route for foreign capital.
• The Joint Parliamentary Committee submitted its report on the Corporate Laws (Amendment) Bill, 2026, recommending changes aimed at simplifying compliance and strengthening governance.
• Parliament passed legislation concerning banking records, tribunals, MSMEs, mineral regulation, and registration of births and deaths.

Editor’s Note

August 2026 has witnessed significant legislative, regulatory and judicial activity across India’s business and legal landscape.

The month has been particularly notable for developments in corporate law, financial regulation and capital markets. The Joint Parliamentary Committee’s report on the Corporate Laws (Amendment) Bill, continuing RBI reforms and SEBI measures indicate a policy emphasis on reducing compliance friction while strengthening governance, transparency and investor protection.

Parliament has also enacted important legislation concerning banking records, tribunals and MSMEs, while amendments concerning mineral regulation and civil registration have progressed. At the judicial level, the Supreme Court has addressed significant issues concerning GST enforcement, cyber-enabled financial fraud, arbitration and regulatory accountability.

This edition highlights principal legal, regulatory and judicial developments from 1 August to 31 August 2026 that may have practical implications for businesses, investors, financial institutions, technology companies and multinational corporations operating in India.

Corporate Law & Governance

Joint Parliamentary Committee Reports on Corporate Laws (Amendment) Bill, 2026

The Joint Parliamentary Committee examining the Corporate Laws (Amendment) Bill, 2026 submitted its report to Parliament on 3 August 2026. The Bill, introduced in March 2026, proposes amendments to the Companies Act, 2013 and the Limited Liability Partnership Act, 2008.

The Committee’s recommendations seek to balance ease of doing business with stronger corporate governance and cover areas including digital governance, corporate compliance, audit provisions, fast-track mergers, director-related requirements and procedural defaults.

The recommendations remain part of the legislative process and do not amend the Companies Act or LLP Act unless and until the Bill is enacted and the relevant provisions come into force.

MCA Extends Companies Compliance Facilitation Scheme

The Ministry of Corporate Affairs has extended the Companies Compliance Facilitation Scheme, 2026 until 31 August 2026, providing eligible companies additional time to regularise specified pending ROC filings.

MSME Development (Amendment) Act, 2026

The Micro, Small and Medium Enterprises Development (Amendment) Act, 2026 received Presidential assent on 13 August 2026. The amendments seek to reduce payment-related constraints, facilitate more time-bound dispute resolution and simplify MSME compliance.

Banking & Financial Regulation

RBI Retains Repo Rate at 5.25%

The Reserve Bank of India’s Monetary Policy Committee retained the policy repo rate at 5.25% and maintained its neutral policy stance, marking the fourth consecutive meeting at which the rate has remained unchanged.

RBI Proposes Harmonised Framework for Interest Rates on Loans and Advances

The RBI has proposed a harmonised framework governing interest rates on loans and advances across regulated entities, including banks and NBFCs. The proposal seeks to reduce fragmentation and establish a more principles-based approach to loan pricing.

RBI Proposes “On-Tap” Licensing for Urban Co-operative Banks

The RBI has proposed a framework for “on-tap” licensing of Urban Co-operative Banks, providing a structured mechanism for eligible entities to obtain banking licences while maintaining prudential and governance requirements.

RBI Strengthens Responsible Business Conduct in Loan Recovery

The RBI has introduced changes concerning the engagement and conduct of recovery agents, aimed at strengthening customer protection and accountability. The revised requirements are expected to become operational from 1 January 2027.

RBI’s Data Governance Framework for Regulated Entities

The RBI’s draft Guidance on Regulatory Expectations for Data Governance seeks to strengthen the reliability, availability, traceability and security of data maintained by regulated entities.

The proposed framework contemplates stronger board oversight and defined responsibilities across the data lifecycle, including Data Owners, Data Stewards and Data Custodians. Comments were invited until 17 August 2026.

Bankers’ Books Evidence Act, 2026

The Bankers’ Books Evidence Act, 2026 received Presidential assent on 13 August 2026, replacing the 1891 legislation. The new framework recognises modern electronic and digital banking records and updates their evidentiary treatment.

Capital Markets & Securities Regulation

SEBI Modifies Framework for Online Bond Platform Providers

On 14 August 2026, SEBI issued a circular modifying the regulatory framework for Online Bond Platform Providers (OBPPs), including measures intended to promote ease of doing business.

SEBI Standardises Net Distributable Cash Flow Calculations for InvITs

SEBI issued a framework on 14 August 2026 for calculating Net Distributable Cash Flows (NDCF) for Infrastructure Investment Trusts (InvITs).

The framework seeks greater consistency and transparency in determining cash available for distribution to unitholders.

SEBI Reviews Stress Testing for Commodity Derivatives

SEBI has initiated a review concerning the inclusion of historical scenarios in stress testing for the commodity derivatives segment, reflecting its continuing focus on risk management and market resilience.

SEBI Proposes Depository Receipts for REITs and InvITs

SEBI has proposed a framework permitting REITs and publicly listed InvITs to issue Depository Receipts (DRs) to overseas investors.

The proposal seeks to create an additional mechanism for accessing international capital, with comments invited until 25 August 2026.

SEBI Proposes Overhaul of Portfolio Management Services Framework

SEBI has proposed a comprehensive restructuring of the Portfolio Management Services (PMS) regulatory framework, including new SEBI (Portfolio Managers) Regulations, 2026.

The proposal seeks to modernise and consolidate the existing regime while introducing greater flexibility in investment strategies and compliance requirements.

Taxation

Taxation and Other Laws (Amendment) Act, 2026

The Taxation and Other Laws (Amendment) Act, 2026 received Presidential assent on 17 August 2026 and amends the Income-tax Act, 2025 and related tax legislation.

The amendments include measures affecting offshore funds, electronic payments and specified investment structures, with the broader objective of reducing compliance friction and improving India’s attractiveness for fund-management and investment activities.

Goods & Services Tax

Supreme Court Mandates Communication of GST Arrest Order Before Arrest

In Union of India v. Sunil Biyani, decided on 12 August 2026, the Supreme Court held that an order authorising arrest under Section 69 of the CGST Act, 2017 must be communicated to the person concerned before arrest.

The decision reinforces procedural safeguards in GST enforcement.

Supreme Court Clarifies Requirements for Invoking Section 74

The Supreme Court has clarified that the extended limitation period under Section 74 of the CGST Act cannot be invoked merely by mechanically alleging fraud, wilful misstatement or suppression. Such allegations must be supported by foundational facts establishing the statutory conditions.

GSTN Holds Proposed E-Way Bill Enhancements

GSTN has placed on hold proposed enhancements to the e-Way Bill system that had been scheduled to take effect from 1 August 2026.

The proposed changes included additional Ship-To GSTIN requirements in specified Bill-To/Ship-To transactions and voluntary closure of e-Way Bills. The changes were put on hold following industry representations.

Competition Law

BRICS Competition Authorities Strengthen Cooperation on Renewable Energy Markets

The Competition Commission of India hosted the BRICS Heads of Competition Authorities Meeting in Udaipur on 8 August 2026 during India’s BRICS Presidency.

The participating authorities adopted a Joint Statement focused on cooperation and knowledge-sharing in competition enforcement, including in renewable-energy markets.

Insolvency & Bankruptcy

IBBI Continues Strengthening Due-Diligence Framework

The IBBI has continued strengthening professional standards and regulatory oversight in insolvency processes. It has also issued a discussion paper concerning guidance to insolvency professionals on due diligence, reflecting the emphasis on professional accountability and process integrity.

Dispute Resolution

Tribunals Reforms Act, 2026 Comes into Force

The Tribunals Reforms Act, 2026, which received Presidential assent on 13 August 2026, replaces the Tribunals Reforms Act, 2021.

The new framework seeks to strengthen the independence, transparency and uniformity of India’s tribunal system and provides for a National Tribunals Commission to oversee appointments, performance and institutional administration.

The Act came into force on 25 August 2026 following notification by the Central Government.

Intellectual Property & Technology

Continued Judicial Focus on AI, Data and Digital Technologies

Indian courts continue to confront emerging issues arising from artificial intelligence, biometric systems and data-driven technologies.

The RBI’s proposed data-governance framework and judicial consideration of emerging surveillance technologies indicate that businesses deploying AI and data-intensive systems will increasingly need to consider governance, accountability, security and privacy.

Consumer & Product Regulation

Supreme Court Scrutinises Front-of-Pack Warning Labels for Packaged Foods

The Supreme Court has questioned the Centre and the Food Safety and Standards Authority of India (FSSAI) concerning implementation of front-of-pack warning labels for packaged foods containing high levels of sugar, salt and fat.

On 13 August 2026, the Court granted the Union Government additional time to place its final position before the Court and indicated that further directions may follow.

Mining & Natural Resources

Mines and Minerals (Development and Regulation) Amendment Act, 2026

The Mines and Minerals (Development and Regulation) Amendment Bill, 2026 was passed by Parliament on 13 August 2026 and received Presidential assent on 17 August 2026.

The legislation seeks greater predictability in the taxation and regulatory framework applicable to mineral rights and mineral-bearing lands and aims to promote long-term investment in the major-minerals sector.

Civil Registration & Digital Records

Parliament Passes Registration of Births and Deaths (Amendment) Bill, 2026

The Registration of Births and Deaths (Amendment) Bill, 2026 was passed by both Houses of Parliament, with the Rajya Sabha approving it on 4 August 2026.

The Bill seeks to strengthen birth and death registration and make delayed-registration requirements more stringent. It also reinforces the significance of such records for identity and public-service delivery.

Employment & Labour

Courts Continue to Address Contract Labour and Employment Rights

Indian courts continue to examine contractual employment, employer-employee relationships and statutory employment benefits.

A recent Delhi High Court judgment reiterated that supervision and control by a principal employer, by themselves, are insufficient to establish an employer-employee relationship with contract labour; the contractual arrangement, recruitment, payment of wages, nature of work and surrounding circumstances must be considered.

Environment & Sustainability

Environmental Compliance Continues to Face Greater Judicial Scrutiny

Environmental regulation remains subject to significant judicial and regulatory attention, particularly concerning environmental clearances, waste management and the “polluter pays” principle.

The Supreme Court has directed the Ministry of Environment, Forest and Climate Change to develop a more comprehensive framework concerning environmental compensation under the Solid Waste Management Rules, 2026, with the objective of ensuring greater consistency in implementation.

Practical Takeaways for Businesses

• Companies should regularise eligible ROC filings under the Companies Compliance Facilitation Scheme and monitor the Corporate Laws (Amendment) Bill.
• Banks and NBFCs should monitor RBI reforms concerning loan pricing, recovery agents, data governance and UCB licensing.
• RBI-regulated entities should review data-governance architecture and processes for maintaining and authenticating electronic banking records.
• SEBI-regulated entities should review August measures concerning OBPPs, InvIT distributions and commodity-derivatives stress testing.
• REITs and InvITs should evaluate the proposed Depository Receipt framework and its implications for foreign investment.
• Businesses involved in GST investigations should review safeguards concerning arrest under Section 69 and the requirements for invoking Section 74.
• Businesses dealing with MSMEs should review payment practices and contractual arrangements.
• Companies should monitor implementation of the Registration of Births and Deaths, MMDR and Tribunals Reforms legislation.
• Businesses using contract labour should review contractual structures and statutory compliance.
• Companies deploying AI and data-intensive technologies should strengthen data governance, cybersecurity and accountability.
• Food and beverage businesses should monitor front-of-pack labelling developments.
• Mining, infrastructure and environmentally regulated businesses should assess evolving environmental and mineral-sector requirements.

Looking Ahead

Businesses should particularly monitor:

• The finalisation and implementation of the Corporate Laws (Amendment) Bill, 2026.
• Implementation of the Tribunals Reforms Act, 2026.
• Developments concerning the draft FEMA Foreign Investment Rules, 2026.
• SEBI’s proposed framework for Depository Receipts against REIT and InvIT units.
• Implementation of the Taxation and Other Laws (Amendment) Act, 2026.
• Further RBI measures concerning lending, data governance and banking regulation.
• Developments concerning GST enforcement and Sections 69 and 74 of the CGST Act.
• Further judicial developments concerning arbitration, digital fraud and emerging technology.
• Additional legislative and regulatory measures affecting businesses, investors and regulated entities.

Closing Note

India’s legal, regulatory and judicial landscape continues to evolve rapidly, with policymakers, regulators and courts placing increasing emphasis on ease of doing business, corporate governance, investor protection, digitalisation, regulatory accountability and sustainable development.

The developments highlighted in this edition demonstrate the importance of proactive compliance and continuous monitoring of legislative and judicial developments affecting business operations, investment structures and commercial decision-making.

At KBD Partners, we remain committed to helping clients navigate these developments through commercially focused legal advice and strategic regulatory guidance. We hope this edition of the KBD Monthly Monitor provides valuable insights into the evolving legal landscape and assists businesses in making informed decisions.

KBD Partners

Email: mailbox@kbdlawpartners.com

About KBD Partners

KBD Partners is a full-service law firm advising domestic and international clients across a broad spectrum of legal and regulatory matters. The Firm’s practice areas include Corporate and Commercial Law, Mergers & Acquisitions, Renewable Energy and Infrastructure, Real Estate, Intellectual Property, Employment Law, Regulatory Compliance, Arbitration and Dispute Resolution.

Our lawyers combine technical legal expertise with commercial understanding to provide practical, solution-oriented advice tailored to clients’ business objectives. We regularly advise corporations, financial institutions, investors, start-ups, promoters and high-net-worth individuals on complex transactions, regulatory matters and strategic disputes.

With a commitment to excellence, responsiveness and client service, KBD Partners strives to deliver high-quality legal solutions that help clients navigate evolving legal and business challenges with confidence.

Disclaimer

This publication has been prepared by KBD Partners for informational purposes only and does not constitute legal advice, solicitation or advertisement. The contents of this publication should not be relied upon as a substitute for specific legal advice. Readers are advised to seek professional advice before acting upon any information contained herein.