Banks in a GST fix over RBI's directive to levy penal charges

The ban on 'penal interest' on borrowers is posing a tax dilemma for banks.  Banks  fear that the Reserve Bank of India's (RBI) directive to levy penalty only in the form of ' penal charges ' as against the hitherto practice of imposing 'penal interest' would attract the  goods and services tax  ( GST ) on such levies. While  interest rates &nbs…