Office of Auditor General directs 13 merchant banks to pay Rs 2.30 crore as income tax

The office of Auditor General has directed the 13 merchant banks to pay Rs 2.30 crore as income tax. The tax offices of Tangal and Putalisadak have been authorised to collect the amount from the merchant banks.

As per Schedule 1 of Income Tax Act 2058, the banking institutions not registered in VAT are liable to pay 30% as income tax. But the merchants banks are found to have been paying income tax as an ordinary entity at 25%.

So, the office of Auditor General has directed the merchant banks to pay income tax at 30% which turns out to be Rs 2.30 crore.

Merchant Banks perform functions like issue manager, share registrar as well as manage various mutual funds and portfolio.