Direct Tax Services
Audit
Consulting
ESG Advisory
Indirect Tax Services
RBI Services
SEBI Services
IRDA Registration
FEMA Advisory
Compliances
IBC Services
VCFO Services
Developed
Developing
BOTs
American
EU-1
EU-2
South East
South Asia
Gulf
ME
Select Your Location
RBI has issued a new notification vide CIRCULAR NO RBI/2022-23/136 CO.DGBA.GBD.No.S957/43-33-005/2022-2023 on 14.11.2022, has directed the agency banks to submit their claims for commission in the set format to CAS (central account section) Nagpur in respect to central government transaction and the respective regional office of RBI for state government transactions.
The agency banks receive agency commission as a payment from the reserve bank of India for handling the government business. The master circular on the conduct of government business by agency banks, payment of agency commission date April 1, 2022, related to claiming agency commission, is mentioned in Para 21 of the captioned master circular.
The article discusses the critical provisions of RBI notification to clarify the changes made for agency banks.
Table of Contents
The agent banks receive a commission from the reserve bank of India for handling government business.
An agency bank is also called an agent bank. It performs services in some capacity on behalf of a business. It can provide various services for businesses seeing to expand internationally. These agent banks primarily act in support of another bank or peer of banks, but they can act on behalf of a person or business.
Look at the eligibility criteria for transactions related to RBI paying the agency commission to agent banks for handling the government business are:
Agency Banks are advised to carefully seek instructions published by the Reserve bank of India from timely concerning transactions which are not eligible for an agency commission and submit their claims for an agency commission accordingly. All agent banks claiming agent commission certify that agency commission is not claimed on ineligible transactions.
After implementing the TIN 2.0 regime for direct tax collection, it’s decided to modify para 21 of the circular on the conduct of govt. Business by agency banks. The following are the modified circular:-
Agency banks submit the claims for agency commission which they will get from RBI on behalf of handling the government service in the set format to the central account service Nagpur regarding central government transactions and the separate regional office of RBI for state government transactions simultaneously.
However, agency commission claims regarding GST receipt transactions and direct tax collection transactions are covered by the TIN 2.0 regime. The claims will only be settled at Mumbai’s Reserve Bank of India (RBI) Regional Office. Consequently, all agent banks authorized for Goods and service tax and direct tax collection under the TIN 2.0 regime are advised to submit their agency commission claims related to the separate receipt transactions at Mumbai Regional Office only.
The direct tax about the agency transaction under OLTAS will continue to be settled at the Central account section, Nagpur, RBI. The prescribed formats for claiming agency commission for all agency banks or agent banks and respective and distinctive sets of certificate to be signed by the branch officials & Chartered Accountants (CA) or Cost Accountants are mentioned in Annex 2, Annex 2A and Annex 2B separately. These certificates will be an extension to the Certificate from a chief general manager (in charge of government business) to the result that there are no pension transactions to be credited or delays in crediting regular pension arrears thereof.”
The provision issue by the RBI[1] regarding the agency commission for direct tax collection. RBI modify the para 21 in the master circular, this is for the all agency banks. As per the circular the agent bank will submit the claim for the agent commission in respect to handling the services of government and commission will pay by the Reserve bank of India. The certificate is signed by the branch manager which is given in annexure.
Read Our Article: Patent Infringement Letter: All You Need To Know
Training audit refers to a fact-based assessment to know whether the work the Learning & De...
The entertainment industry works and flourishes on human emotions. The entertainment sector com...
The Securities Exchange Board of India (SEBI) has issued a circular on the redressal of investo...
There has been a revolutionary transformation in the world of finance with the rise of cryptocu...
The World Trade Organisation defines e-commerce as ‘distribution, production, sale, marketing...
Are you human?: 2 + 5 =
Easy Payment Options Available No Spam. No Sharing. 100% Confidentiality
The Foreign Currency Exposure is a risk associated with the business engaged in the activities of dealing in foreig...
12 Oct, 2022
The digital age and its new inventions in every field have increased the hassle with the vent of new technology flo...
15 Jan, 2021
Chat on Whatsapp
Hey I'm Suman. Let's Talk!