Bhopal (Madhya Pradesh): The Union Budget has offered a strong and timely push to Micro, Small and Medium Enterprises (MSMEs), which account for nearly 99 per cent of India’s industrial sector and encompass
over 2,000 industry clusters and small-scale units.
The allocation of ₹10,000 crore for the MSME Growth Fund is a commendable step that will strengthen Indian industry, improve access to capital, and enhance global competitiveness.
Equally significant is the rationalisation of income tax penalties. The reduction in penalty for misreporting of income from 200 per cent to 100 per cent will provide much-needed relief to taxpayers, particularly in search and survey cases, and help reduce prolonged litigation. This move reflects a more balanced and taxpayer-friendly approach.
The Budget has also streamlined income tax return filing timelines. The due date for non-business taxpayers filing ITR Forms 1 and 2 remains July 31, while non-audit businesses and trusts now have time until August 31. This clear differentiation will ease compliance and benefit both taxpayers and tax professionals.
A major procedural relief has been provided to residents purchasing property from Non-Resident Indians. Earlier, obtaining a Tax Deduction Account Number (TAN) was mandatory to deduct TDS. Under the new provision, PAN-based TDS deduction will suffice, eliminating unnecessary procedural hurdles.
The government’s efforts to smoothen tax administration ahead of the new Income Tax Act, effective April 1, 2026, are welcome. Another positive reform is the enhancement of the NRI investment limit in Indian equities under the portfolio investment scheme from 5 per cent to 10 per cent, which is expected to boost foreign investment and strengthen capital markets.
Overall, the Budget makes adequate provisions for industry, infrastructure, rail and rare earth corridors, chemical parks, Ayurveda and healthcare, semiconductor mission 2.0, textiles, overseas investors, and ease of doing business. These initiatives promise long-term, sustainable economic reforms for India.
( The writer,Rajesh Jain is Chartered Accountant in Bhopal )
