The Parliament’s Monsoon Session, beginning July 20, will have a relatively light legislative agenda, with the government seeking approval for key pending bills, including the Foreign Contribution (Regulation) Amendment Bill, 2026, to tighten rules governing foreign funding of non-government organisations (NGOs).

The Income-Tax (Amendment) Bill, 2026, will replace an ordinance granting tax concessions on foreign investment in government debt securities.

The government has listed five new bills for the session, which concludes on August 13. These include the Micro, Small and Medium Enterprises Development (Amendment) Bill, 2026, aimed at aligning the MSME Development Act, 2006, with the sector’s evolving needs.

The Foreign Contribution (Regulation) Amendment Bill, 2026, seeks to strengthen the framework governing how Indian entities, individuals and NGOs receive, utilise and create assets from foreign contributions.

A key provision of the Bill is the creation of a designated authority to take charge of foreign contributions and assets if an organisation’s FCRA registration is cancelled, surrendered or lapses. In such cases, assets created using foreign funds may be taken over, managed or disposed of by the authority in accordance with prescribed rules, replacing the current system that lacks a structured mechanism for handling such situations.

The Income-Tax (Amendment) Bill, 2026, will replace the ordinance promulgated on June 5 to provide tax relief to foreign portfolio investors (FPIs). The measure grants a retrospective exemption, effective April 1, 2026, from taxes on capital gains and interest income earned from investments in government securities. Earlier, FPIs were subject to a 30% tax on short-term capital gains, a 12.5% tax on long-term capital gains and a 20% tax on interest income—levies that had remained a key deterrent even after India’s inclusion in major global bond indices.

The Micro, Small and Medium Enterprises Development (Amendment) Bill, 2026, seeks to improve the ease of doing business through trust-based regulation, strengthen the mechanism for addressing delayed payments to MSMEs, enable enforcement of arbitral awards in favour of micro and small enterprises, and provide states with greater flexibility in determining the composition of Micro and Small Enterprises Facilitation Councils (MSEFCs), allowing more such councils to be constituted.

Disclaimer: This article is based on a recent ITAT Pune ruling in a specific case. Judicial decisions are fact-specific, and their applicability depends on individual circumstances. Taxpayers should seek professional advice before relying on this ruling for their own cases.

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