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By EquityPandit

MARKETS

J&K Bank Shares Slump 3% on Receiving GST Notice 

The demand order won't have a significant impact on its overall business operations, financial situation, or activities.

Shares of Jammu and Kashmir Bank Ltd fell 3% during the trading session on Wednesday, 5 February, after the company received an astounding Rs 16,000-crore GST notice. The notice also includes the GST penalty amount.

The bank, in a regulatory filing, said, “Bank has received a demand dated 4 February 2025 from Joint Commissioner, Central GST Commissionerate, Jammu for GST liability of Rs. 81,30,66,42,768 with interest as applicable and penalty of Rs. 81,30,66,42,768.”

The filing added, “The bank has taken appropriate legal recourse in the matter and based on our assessment and legal course adopted by the bank and expert opinion, we believe that the demand order shall have no material impact on the financials, operations or other activities of the bank.”

J&K Bank has stated that the demand order won’t have a significant impact on its overall business operations, financial situation, or activities.

J&K Bank stated that interest receivable under the transfer pricing mechanism (TPM) between its corporate headquarters and branches from a common pool of funds has been classified as a financial service, making it subject to GST.

The demand notice relates to transactions under the bank’s TPM for the period 8 July 2017 to 31 March 2020. Within a bank, funds or liquidity act as a shared resource utilized across various business units.

At 3:30 pm, the shares of J&K Bank closed 2.27% higher at Rs 101 on NSE.

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