CBDT Amends Safe Harbour Rules

• The CBDT vide notification no. 21/2025 dated 25th March 2025 has amended Rule 10TA (definitions for Safe Harbour Rules) and Rule 10TD (safe harbour) of Safe Harbour Rules (SHR).
• These amendments are in relation to, expanding definition of core auto components under SHR and increasing turnover thresholds for certain eligible international transactions of provision of services. Further, applicability of Safe Harbour Rules is extended.

EXTENDED SAFE HARBOUR PERIOD

• The scope of Safe Harbour Rules are now extended for AY 2025-26 and AY 2026-27.

EXPANDING DEFINITION OF CORE AUTO COMPONENTS

• Amended definition of core auto components shall also include lithium-ion batteries for use in electric or hybrid electric vehicles. Accordingly, eligible assessee engaged in eligible international transaction of manufacture and export of lithium-ion batteries for use in electric or hybrid electric vehicles can target operating margin of 12%.