TMB failed to file details of Rs 3,610 cr deals due to tech glitch: sources

After the Income Tax Department pointed out that Tamilnad Mercantile Bank (TMB) had not provided full details of transactions amounting to Rs 3,610 crore, sources told Business Standard that this was due to a technical glitch. The bank has now submitted all the required documents in the last few days.

As per the Income Tax Department (IT), TMB has not filed a Statement of Financial Transactions (SFT) related to cash deposits of around Rs. 2,700 crore involving more than 10,000 accounts. The officials also highlighted discrepancies in specific credit card payments involving total transactions of Rs 110 crore, dividends of more than Rs 200 crore and shares issued of more than Rs 600 crore.

“Banks are required to report these SFT transactions at periodic intervals to IT. The bank made all required deposits, but this was not updated in the portal due to an inadvertent technical error. It was not an intentional omission,” said a source familiar with the development. Sources indicate that This may not result in any penalty to the bank, even if the omissions were willful, the penalty would probably be in the order of Rs 50,000 only.

The IT department conducted a surprise raid on the offices of the Thoothukudi-based bank on 27-28 June. Management said several large transactions, including interest payments of more than Rs 500 crore, term deposits, cash deposits and withdrawals from current accounts, were not reported by the bank. In addition, Form 61B, which provides information about account holders residing in other countries, was reportedly incorrectly filed. The department reviewed all transactions of the past three years, starting from 2020-2021. The bank has now corrected the technical error and uploaded the required documents.