Former CJI DY Chandrachud urges India to stop unpredictable tax changes and simplify legal systems for economic growth. He says fairness and digital tools are key to building trust and boosting investments.
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MAHARASHTRA: Former Chief Justice of India (CJI) DY Chandrachud said that India must stop making sudden tax law changes for the past (retrospective tax) and bring big reforms in its laws and regulations if it wants to reach the goal of becoming a $10 trillion economy.
While speaking at the 100-year celebration event of the Chamber of Tax Consultants in Mumbai, Justice Chandrachud said that confusing and changing tax rules can scare away investors and slow down India’s economic progress.
He gave a clear warning:
“The destabilizing ghosts of retrospective tax amendment must be permanently banished.”
He explained that tax laws must be simple, clear, and fair so that people and businesses can understand and follow them easily. That way, more people will pay taxes honestly, and investors will feel confident to invest in India.
“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. A regime viewed as capricious or excessively adversarial undermines its own revenue goals by discouraging compliance and investment,”
-he said.
Justice Chandrachud also spoke about the new Income Tax Bill of 2025, which is currently being looked at by a Parliamentary Select Committee.
He praised the bill for being much simpler than the old law from 1961.
“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. How many trees have been cut in devoting paper to understanding whether a proviso to a section Is an exception or an explanation, The word count of the new bill is nearly half of the old act,”
-he said.
However, he also gave a word of caution. He said that simplification should be real and not just for show.
“New tax laws should not create new ambiguities that can lead to protracted litigation,”
-he warned.
He connected this idea to other legal reforms too. Referring to changes in India’s criminal laws, he said:
“While new enactments retain the skeletal framework and core principles of their predecessors, they should not be mere replicas. New laws must represent a conscious evolution of thought to address the realities of the 21st century and of emerging India.”
Justice Chandrachud also stressed how important technology is for faster court cases and legal services.
He said that digital tools can save both time and money.
“For Digital India to succeed, we must deliver professional services quickly and effectively through digital means,”
-he said.
He talked about how online court hearings during COVID-19 helped the system save crores of rupees.
“The adoption of virtual hearings yielded savings of over ₹1,200 crores annually. Imagine the good that can be achieved towards reducing litigation. That money could be used for judicial infrastructure, legal aid, and training,”
-he stated.
He said that the huge number of pending tax cases is hurting India’s economy. These delays are stopping investments, disturbing businesses, and breaking public trust.
He strongly supported using Online Dispute Resolution (ODR) to quickly settle small tax disputes.
“ODR must be used for low-value tax claims. 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.”
Justice Chandrachud also shared a shocking personal experience about online fraud.
“I was shocked to discover that 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 said.
Lastly, he called for setting up special courts to handle commercial cases like finance, competition, trade, and new technologies.
“These courts should resolve cases quickly, ideally within 180 days. We also need world-class arbitration and mediation centers matching international standards. This will help us resolve complex international business disputes efficiently and earn global respect,”
-he said.
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