Dhanlaxmi Bank signed MoU with CBDT, CBIC for tax collection

Dhanlaxmi Bank on Thursday said it has signed a memorandum of understanding with Central Board of Direct Taxes (CBDT) and Central Board of Indirect Taxes and Customs (CBIC) for collection of taxes. The bank has been authorised by the Reserve Bank of India (RBI) based on the recommendation from the Controller General of Accounts for collection of various taxes, Dhanlaxmi Bank said in a regulatory filing.

Key Points:

The technical integration required to implement the seamless flow of remittances from the bank’s portal to that of CBDT and CBIC will be completed at the earliest in order to provide early access to its customers towards the facilities. The bank was empanelled as a ‘Agency Bank’ by the RBI in October, allowing it to handle general banking activity for the federal and state governments on their behalf.

It is to be noted that RBI had in 2020 appointed its General Manager D K Kashyap on the board of the bank for two years.

To avoid any conflict of interest, the central bank normally does not appoint its nominee to the boards of private banks unless there are extraordinary circumstances.

Dhanlaxmi Bank, based in Kerala, was placed under the RBI’s Prompt Corrective Action (PCA) framework in November 2015 due to its poor financial condition, and it was only last year that it was released. It has been profitable since then.