J&K Bank Receives ₹400 Crore GST Demand Notice from Central Tax Authorities
Srinagar, March 23, KNT: Jammu and Kashmir Bank Ltd. has received a Goods and Services Tax (GST) demand notice of approximately ₹400 crore from the Additional Commissioner of the Central GST Commissionerate, Jammu, the bank said in a regulatory filing on Tuesday.
The demand includes a GST liability of about ₹200 crore along with an equal amount as penalty, officials said.
“This is to inform that the Bank has received a demand dated March 23, 2026 from Additional Commissioner, Central GST Commissionerate, Jammu for GST liability of Rs 200,20,80,009 with applicable interest and penalty of Rs 200,20,80,009,” the bank said in its exchange filing.
The development comes even as the bank reported improved financial performance for the third quarter of the current fiscal year.
The notice is significant as it raises compliance and financial implications for the bank, although officials have not yet indicated whether the demand will be contested or settled.
According to the filing, the GST component stands at over ₹200 crore, with a matching penalty amount, effectively doubling the total exposure to around ₹400 crore, excluding applicable interest.
Financial experts said such tax demands are subject to legal and procedural review, and companies often seek clarification or challenge them through appropriate forums.
Meanwhile, Jammu and Kashmir Bank reported an 11% increase in net profit for the third quarter ending December 31, 2025.
Jammu & Kashmir Bank Ltd. is a scheduled commercial bank incorporated in 1938 and headquartered in Srinagar. It functions as a universal bank, offering retail and corporate banking services across India, with a strong presence in Jammu and Kashmir.
The bank is unique in its ownership structure, with the Government of Jammu and Kashmir as a major shareholder, while its shares are also listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE).
J&K Bank plays a key role in financial inclusion and credit delivery in the Union Territory, particularly in agriculture, small businesses and government-linked schemes. It also acts as the primary banker for several government departments and public sector initiatives in the region.
Over the years, the bank has expanded its footprint beyond Jammu and Kashmir, establishing branches in major cities across India while maintaining its regional focus.
In recent years, the bank has undertaken reforms to improve asset quality and operational efficiency, including reducing non-performing assets (NPAs) and strengthening its balance sheet.
The bank posted a net profit of ₹589 crore, compared to ₹531 crore in the corresponding quarter of the previous fiscal year.
Total income during the quarter rose to ₹3,593 crore, up from ₹3,448 crore in the same period last year, reflecting steady operational growth.
Asset quality also improved, with gross non-performing assets (NPAs) declining to 3% of gross loans in the December quarter of FY26, compared to 4.08% a year earlier.
Market reaction to the developments remained positive, with the bank’s stock rising during trading.
Shares of J&K Bank surged as much as 5.03% to ₹114.83 before closing 3.46% higher at ₹113.11 apiece. This compared with a 1.78% gain in the benchmark Nifty index.
Analysts said the rise in share price suggests investor confidence in the bank’s financial performance, despite the tax demand.
“The market appears to be factoring in the bank’s improved earnings and asset quality, even as the tax issue emerges,” a market analyst said.
Jammu and Kashmir Bank, a key financial institution in the region, continues to play a significant role in banking and credit delivery, particularly in Jammu and Kashmir. [KNT]
