**Summary:**
This circular, RBI202223112 DCM NPD No.S77009.40.002202223, issued by the Reserve Bank of India (RBI) on September 06, 2022, clarifies the applicability of Goods and Services Tax (GST) on service charges levied on cash deposits made by non-chest bank branches to currency chests. The circular addresses queries received regarding the service charges outlined in previous circulars RBI 201516 293 DCM NPD No. 2564 09.40.02 201516 dated January 21, 2016 and DCM Plg. No 2845 10.25.007201819 dated May 23, 2019. It specifies that the service charges mentioned in the aforementioned circulars are exclusive of applicable taxes. Therefore, the service charges should be interpreted as ₹5 plus applicable taxes per packet and ₹8 plus applicable taxes per packet, as applicable. The circular is addressed to the Chairman/Managing Director/Chief Executive Officer of all banks with currency chests. Sanjeev Prakash, Chief General Manager, is the contact person for this circular.
Key Entities Referenced
RBI: Reserve Bank of India, the central bank of India.
Currency Chests: Bank branches authorized to hold currency on behalf of the RBI.
GST: Goods and Services Tax, an indirect tax in India.
Sanjeev Prakash: Chief General Manager at RBI, signatory of the circular.
January 21, 2016: Date of the circular RBI 201516 293 DCM NPD No. 2564 09.40.02 201516 regarding incentive for improving service to nonchest branches.
May 23, 2019: Date of the circular DCM Plg. No 2845 10.25.007201819 regarding incentive for improving service to nonchest branches.
All Banks: All Banks in India having Currency Chests
RBI/2022-23/112
DCM (NPD) No.S770/09.40.002/2022-23 September 06, 2022
The Chairman & Managing Director
Managing Director/ Chief Executive Officer
All Banks having Currency Chests
Madam/ Sir,
Incentive for improving service to non-chest branches
Please refer to circulars RBI/ 2015-16/ 293 DCM (NPD) No. 2564/ 09.40.02/ 2015-16
dated January 21, 2016 and DCM (Plg.) No 2845/ 10.25.007/2018-19 dated May 23,
2019 on the captioned subject.
2. We have been receiving queries regarding the applicability of GST on the service
charges levied on cash deposited by non-chest bank branches to the Currency
Chests. It is clarified that the amount indicated in the aforesaid circulars are exclusive
of applicable taxes. Accordingly, the service charges mentioned in the aforesaid
circulars is to be read as ₹5 plus applicable taxes per packet and ₹8 plus applicable
taxes per packet, as the case may be.
Yours faithfully,
(Sanjeev Prakash)
Chief General Manager