No service tax on maintenance of minimum balance as consideration for Banking Services

Canara Bank Vs Union of India (Karnataka High Court) Conclusion: Non-maintenance of minimum balance by customers did not generate taxable consideration and, therefore, no service tax/GST, interest or penalty could be levied. Revenue was also bound by its earlier acceptance of an identical adjudication order in favour of another bank. Held: Assessee-banks challenged show-cause notices proposing levy of service tax/GST on amounts arising from customers’ failure to maintain minimum average balance. The banks contended that there was no agreement whereby customers paid consideration in retur...