Several banks in India have resolved to pursing legal action following the government's decision to levy services offered to customers who maintain large deposits for services like wealth management or lockers without paying an annual fee.
Indian authorities have decided to view these "complementary" services provided to clients with large deposits as taxable.
The government has alleged that through the deposit based services, cumulatively, over a dozen banks did not pay taxes worth Rs 18,000 crore. While notices were issued in April 2018, the banks remained in silence. Now, they are taking the case to court.
The conflict is being regarded by banks as an "industry issue", according to a report by the Times of India, with responsibility for the matter Indian Banks' Association, which currently represents 237 banking companies operating in India.
The banks targeted with the heaviest levies have been cited as HDFC (Rs 6,200 crore), ICICI (Rs 3,500 crore), and Axis (Rs 3,200 crore.)
Bankers have shared the view that the deposit-based services were offered in a similar vein to the free lounge access, cheque deposit, ATM usage, and debit cards offered to premium account holders, stating that the intent was "not to avoid tax."