The Directorate General of Goods and Services Tax Intelligence (DGGST) has informed several banks by sending prior notices regarding the payment of taxes. It comprises SBI, HDFC, ICICI Bank, Axis Bank and several other banks. These banks have collected money from the customers for not keeping the minimum balance in their accounts but haven’t paid taxes to the government. DGGST is also demanding that banks should pay also taxes on the free facilities provided to the account holders who have maintained the minimum balance in their accounts.
According to the official sources, the banks can take some actions against DGGST in this matter and they might further appeal to the government. The Directorate General of Goods and Services Tax Intelligence (DGGST) has started doing investigations in respect of keeping the minimum balance in bank accounts and various services being offered by the banks to the customers. It was found that either bank charged some fee for their services from customers who were not keeping the minimum balance in their accounts or provided some free facilities to those who are maintaining the minimum balance.
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The most challenging situation for the banks is that the tax department has also asked them to pay tax on the fee charged for back-dated transactions/services. The banks are in trouble as to how they are supposed to collect taxes from the customers on their old transactions. It is being stated that this amount may have crossed thousands of crores of rupees.
