The Central Board of Direct Taxes (CBDT) has rolled out a major modernisation of the Capital Gains Account Scheme (CGAS) through two notifications, 161/2025 (CGAS Second Amendment Scheme, 2025) and Notification 162/2025 (CGAS Authorised Banks List). These changes, effective 19 November 2025, bring the 37-year-old scheme into the digital era while expanding access for taxpayers and banks alike.
This article provides details of these updates, including digital payments, new authorised banks, Section 54GA benefits, and operational changes relevant for 2025 and beyond.
1. CGAS Now Covers Section 54GA Exemption for SEZ Relocation
A major policy upgrade is the inclusion of Section 54GA, which provides capital gains exemption for businesses shifting industrial undertakings from urban areas to Special Economic Zones (SEZs).
With this change:
- Taxpayers relocating to SEZs can now deposit their capital gains under CGAS.
- All related forms (A, B, C, G, H) have been updated.
- This amendment incentivises SEZ development and eases compliance for industrial units.
2. Expanded Definition of “Deposit Office” – 19 New Banks Added
CBDT Notifications 161/2025 and 162/2025 significantly broadens the network of banks authorised to operate CGAS accounts.
Newly Authorised Banks (Non-Rural Branches Only):
- HDFC Bank
- ICICI Bank
- Axis Bank
- City Union Bank
- DCB Bank
- Federal Bank
- IDFC FIRST Bank
- IndusInd Bank
- Jammu & Kashmir Bank
- Karnataka Bank
- Karur Vysya Bank
- Kotak Mahindra Bank
- RBL Bank
- South Indian Bank
- Yes Bank
- Dhanlaxmi Bank
- Bandhan Bank
- CSB Bank
- Tamilnad Mercantile Bank
This is in addition to:
- State Bank of India (SBI)
- Subsidiary banks
- Nationalised banks
Important: Only non-rural branches qualify. A rural branch is defined as one located in an area with a population below 10,000 (2011 Census).
This update officially modernises the “Deposit Office” definition and dramatically increases CGAS access across India.
3. Digital Payments Now Fully Recognised Under CGAS
CGAS deposits were historically made through cheques or demand drafts. The 2025 amendments replace this outdated system with a wide range of electronic payment modes, including:
- UPI
- IMPS
- NEFT
- RTGS
- Net Banking
- Credit Cards
- Debit Cards
- BHIM Aadhaar Pay
Effective Date of Deposit:
For electronic payments, the date the bank receives the payment (subject to realisation) will be considered the deposit date, a crucial factor for capital gains compliance.
4. Electronic Statements Replace Physical Passbooks
The scheme now formally recognises:
- Electronic statements of account, which will hold the same validity as traditional passbooks.
This change benefits taxpayers who prefer paperless compliance and online record-keeping.
5. Online Closure of Accounts (Mandatory from April 1, 2027)
A major procedural upgrade:
- Forms G and H (used for withdrawal/closure) must be submitted electronically from 1 April 2027.
- Submission will require Digital Signature Certificate (DSC) or Electronic Verification Code (EVC).
- CBDT Systems Directorate will publish the digital process and authentication rules.
This ensures CGAS becomes fully integrated into India’s digital tax ecosystem.
6. Updated Forms for Digital Transactions
CGAS forms have been redesigned with additional fields for:
- UPI/IMPS/NEFT/RTGS transaction IDs
- Electronic payment details
- Section 54GA reporting
These changes streamline compliance for taxpayers using modern banking methods.
7. Before vs After: What Has Changed?
Before Amendments in November 2025
- Cheque/DD payments only
- Paper passbooks mandatory
- No coverage for Section 54GA
- Closure only via physical forms
- Limited bank network (mainly SBI + few nationalised banks)
- No digital verification or online filing
After Amendments in November 2025
- Digital payments via UPI, IMPS, NEFT, RTGS, cards
- E-statements accepted
- 54GA included in the scheme
- Online closure mandatory from April 2027
- 19 private-sector banks newly authorised (non-rural branches)
- Forms updated with digital transaction fields
- Greater convenience and faster compliance
Conclusion: CGAS 2025 Brings Convenience, Compliance & Digital Transformation
With Notifications 161/2025 and 162/2025, the Government has transformed CGAS into a modern, technology-aligned, taxpayer-friendly scheme. From digital payments to expanded banking access and SEZ investment incentives, these updates signal a strategic shift away from paper-driven processes toward seamless, electronic compliance.
For further details/ official information, please refer:
CBDT Income Tax Notification 161/2025 dated 19/12/2025: CGAS Second Amendment Scheme 2025
CBDT Income Tax Notification 162/2025 dated 19/12/2025: Revised List of CGAS Authorised Banks