DY Chandrachud, Former CJI.
Former CJI D.Y. Chandrachud Urges Ban on Retrospective Tax Amendments: Mumbai, India – July 5, 2025 – Former Chief Justice of India (CJI) D.Y. Chandrachud today delivered a powerful address, advocating for a permanent cessation of retrospective tax amendments and a comprehensive overhaul of India’s legal and regulatory framework. Speaking at the centenary celebrations of the Chamber of Tax Consultants in Mumbai, Justice Chandrachud emphasized that such reforms are crucial for India to achieve its ambitious goal of becoming a $10 trillion economy.
Justice Chandrachud unequivocally stated that unpredictable tax laws serve as a significant deterrent to investments and pose a formidable roadblock to the nation’s economic aspirations. “The destabilizing ghosts of retrospective tax amendment must be permanently banished,” he asserted, underscoring the need for stability and certainty in the tax regime.
He stressed that clarity, simplicity, and fairness in tax law are not merely desirable but are central to fostering economic growth and building public trust. “The health of India’s economy is intrinsically linked to a tax regime which is perceived by taxpayers and investors as fair, transparent, predictable and efficient,” Justice Chandrachud remarked. He cautioned that a regime viewed as “capricious or excessively adversarial undermines its own revenue goals by discouraging compliance and investment.”
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Praising the New Income Tax Bill, Cautioning Against New Ambiguities
Turning his attention to the Income Tax Bill of 2025, which is currently under review by a Parliamentary Select Committee, Justice Chandrachud lauded it as a significant improvement over the archaic 1961 Income Tax Act. He highlighted the drastic simplification: “The old Income Tax Act had 819 sections divided into 47 chapters, including alphanumerical sections like 115JB. The new bill reduces this to 536 sections and just 23 chapters, while eliminating 1,200 provisos. The word count is nearly half.” He humorously noted the environmental benefit, questioning “How many trees have been cut in devoting paper to understanding whether a proviso to a section Is an exception or an explanation.”
However, the former CJI also offered a word of caution, stressing that simplification must be meaningful. “New tax laws should not create new ambiguities that can lead to protracted litigation,” he warned, advocating for legislative clarity that truly reduces legal disputes.
Drawing parallels with the recent overhaul of criminal laws, Justice Chandrachud opined that while new enactments should retain the skeletal framework and core principles of their predecessors, they “should not be mere replicas.” He urged that “New laws must represent a conscious evolution of thought to address the realities of the 21st century and of emerging India.”
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Leveraging Technology and Expanding Dispute Resolution
Justice Chandrachud also underscored the critical role of technology in enhancing the delivery of professional services and improving judicial efficiency. “For Digital India to succeed, we must deliver professional services quickly and effectively through digital means,” he emphasized.
He cited the widespread adoption of video conference platforms for court hearings during the COVID-19 pandemic as a prime example of technology’s potential. He revealed that “The adoption of virtual hearings yielded savings of over ₹1,200 crores annually.” He envisioned these savings being redirected towards crucial areas such as “judicial infrastructure, legal aid, and training,” thereby significantly reducing litigation.
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Addressing the persistent issue of unresolved fiscal disputes, Justice Chandrachud noted that such backlogs hamper economic activity by causing delays, stalling investments, affecting businesses, eroding public trust, and ultimately holding back growth. To combat this, he passionately called for the expansion of online dispute resolution (ODR) mechanisms, particularly for small tax disputes.
“ODR must be used for low-value tax claims,” he urged. “Today, all these travel right up to the Supreme Court, and I have dealt with all of them in the midst of dealing with some of the most seminal constitutional issues. Taking these small disputes out of the legal system would free up our tribunals and courts to focus on the big, complex cases.”
Addressing Digital Fraud and Advocating for Specialized Courts
In a more somber note, the former CJI also warned about the escalating challenge of digital fraud and deepfake technologies. He recounted a personal anecdote, expressing his shock at an incident where “an industrialist had been duped into paying crores of rupees by a scammer pretending to be me over a video call. My name was used to rob someone and disrupt their peace,” he lamented, highlighting the urgent need for robust digital security measures.
Finally, Justice Chandrachud advocated for the establishment of specialized commercial courts equipped with expertise in finance, trade, competition law, and emerging technologies. He proposed that “These courts should resolve cases quickly, ideally within 180 days.” Furthermore, he called for the development of “world-class arbitration and mediation centers matching international standards,” asserting that this would facilitate the efficient resolution of complex international business disputes and enhance India’s global reputation.
Justice Chandrachud’s address serves as a compelling blueprint for legal and economic reform, emphasizing predictability, efficiency, and technological integration as cornerstones for India’s future prosperity.
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