u/section 194A
what is the concept of CBS
circular no.3/2010 ???
CBS stands for Core Banking Solution, which is the networking of various bank branches through a robust IT infrastructure. It allows the customers to operate their bank accounts and avail the banking services with a centralized network. In other words, with CBS, their accessibility is not limited to just their bank branch, but the bank as a whole.
CBS has been greatly used by banks across India because of its numerous advantages. For starters, it helps to speed up the majority of transactions that are carried across the bank branches on the network with the help of a centralized server. CBS also offers powerful software programs that help the banks with their basic operations like calculations of deposits and loans, interest, etc.
It is clarified via Circular No. 03/2010, dated 2-3-2010 that since no constructive credit to the depositor’s / payee’s account takes place while calculating interest on time deposits on daily or monthly basis in the CBS software used by banks, tax need not be deducted at source on such provisioning of interest by banks for the purposes of macro monitoring only.
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