New Delhi: The Karnataka government has taken a major step by suspending all transactions with the State Bank of India (SBI) and Punjab National Bank (PNB). In an order passed by Chief Minister Siddaramaiah, the state has directed all departments to close their accounts in these banks and promptly recover their deposits.
Opposition-ruled states like West Bengal and Karnataka have time and again attacked the Finance Ministry and the central government accusing the Union of not paying its GST dues. However, the Finance Ministry has refuted the allegation on each occasion. The ban on transactions by central banks comes amid this ongoing tussle.
The order also specifies that no further deposits should be made in SBI or PNB. The directive also extends to public companies, corporations, local bodies, universities and other institutions, directing them to follow the same guidelines.
The directive comes in the wake of allegations of misappropriation of government funds deposited in these banks. Despite previous warnings and communications, the issue remained unresolved, prompting the government to take this decisive step.
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