Jammu & Kashmir Bank Faces GST Demand of Rs.200 Crores for Transfer Pricing Mechanism

Jammu & Kashmir Bank Ltd has received a demand from the Additional Commissioner, Central GST Commissionerate, Jammu for GST liability and penalty amounting to Rs.200,20,80,009 each. The demand is for GST on Interest Receivable under Transfer Pricing Mechanism (TPM) between Corporate Headquarters and Branches from a common pool of funds, treated as financial services. The demand order pertains to the period from February 23, 2020 till March 2024. The Bank has a strong case on merits and believes that the demand will be set aside by the Court. The Bank will take appropriate legal recourse and based on assessment, legal course, and expert opinion, it believes that the demand order will have no material impact on its financials, operations, or other activities.