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TMI BlogClarification on GST on Services of Business Facilitator (BF) or a Business Correspondent (BC) to Banking Company.X X X X Extracts X X X X X X X X Extracts X X X X ..... THAN, I.A.S., COMMISSIONER OF STATE TAX Dated: 23.04.2019 Circular No. 56/2019-TNGST (RC No.26/2019/A1/Taxation) Sub: Clarification on GST on Services of Business Facilitator (BF) or a Business Correspondent (BC) to Banking Company. Representations have been received seeking clarification on the following two issues: (i) W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spondent , the rate and quantum of which may be reviewed periodically. The agreement of banks with the Business Correspondent specifically prohibits them from directly charging any fee to the customers for services rendered by them on behalf of the bank. On the other hand, banks (and not Business Correspondents ) are permitted to collect reasonable service charges from the customers for such se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. Issue 2: Clarification on the scope of services by Business Facilitator/Business Correspondent to a banking company with respect to accounts in rural areas: It has also been requested that the scope of exemption to services provided in relation to accounts in its rural area branch vide Sl. No. 39 of Notification No. II (2)/CTR/532/(d-15)/2017 dated 29.06.2017 be clarified. This cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in rural area and the services which can be provided by Business Facilitator/Business Correspondent , is governed by the RBI guidelines. Therefore, classification adopted by the bank in terms of RBI guidelines in this regard should be accepted. 4. This pari materia circular is issued with reference to the circular issued by the Government of India on the recommendation of the GST Counci ..... X X X X Extracts X X X X X X X X Extracts X X X X
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