Bandhan Bank, a leading private-segment bank in India, has received a notice from the Income Tax (IT) Department for an income tax demand of ₹119.38 crore (approximately USD 15.8 million). According to a recent report, the IT Department has sent a notice to the bank demanding payment of taxes for the financial year 2018-19.
The notice is reportedly a result of a scrutiny assessment proceedings, which were initiated by the IT Department in 2020. The bank had requested the IT Department to reconsider its assessment, but the matter has been dragged on, and the bank has now received the demand notice.
The amount involves a combination of taxes, interest, and penalties. The bank has been informed that the tax demand includes principal amount of ₹84.44 crore, interest of ₹23.44 crore, and a penalty of ₹11.5 crore. The IT Department has also imposed a surcharge of 4% on the principal amount, which has further increased the overall demand to ₹119.38 crore.
Bandhan Bank has stated that it is now considering its options, including appealing against the assessment order and disputing the demand. The bank has a track record of paying taxes regularly and has always been compliant with the tax laws. The bank believes that the demand is excessive and unwarranted, and it is committed to contesting the matter through legal means.
It is worth noting that the IT Department has been scrutinizing the tax returns of notable entities in the country, including businesses and individuals, to ensure compliance with tax laws and regulations. This could be a one-off instance, or it might be part of a broader trend, as the IT Department continues to crack down on tax evaders and taxpayers who try to manipulate their returns.
This development could have implications for other companies, particularly private sector banks and financial institutions, that may be subject to similar scrutiny. As businesses navigate the complex world of taxation, they must ensure that their tax compliance is accurate and timely, to avoid potential disputes and penalties.