PAN Card Holders May Have to Pay Rs 10,000 Penalty Each Time for Missing This Deadline
PAN Card Holders May Have to Pay Rs 10,000 Penalty Each Time for Missing This Deadline
If PAN becomes inoperative, the income tax department will consider that the individual has not submitted PAN and therefore liable to face the consequences for the same. Know details

If your Permanent Account Number (PAN) is not linked to your Aadhaar Card, your PAN card will become inoperative, starting from April 1, 2022. The income tax department has extended the deadline till March 31, 2022 within which all PAN cards in India must be linked with Aadhaar cards. All such PAN cards which are not linked to Aadhaar cards, would be declared inoperative after the deadline ends.

According to Section 139AA of the Income Tax Act, every individual with PAN as on July 1, 2017 and is eligible to obtain Aadhaar, must link PAN with Aadhaar. The taxpayer must mention the Aadhaar number while filing an income tax return.

If PAN becomes inoperative, the income tax department will consider that the individual has not submitted PAN and therefore liable to face the consequences for the same. “Where a person, whose permanent account number has become inoperative…, is required to furnish, intimate or quote his permanent account number under the Act, it shall be deemed that he has not furnished, intimated or quoted the permanent account number, as the case may be, in accordance with the provisions of the Act, and he shall be liable for all the consequences under the Act for not furnishing, intimating or quoting the permanent account number,” the CBDT mentioned earlier.

Rs 10,000 can be Levied as Penalty Each Time you Fail to Furnish PAN Card

It must be noted that having a PAN card is mandatory for several purposes like opening of a bank account, buying mutual funds or shares and even making cash transactions of over Rs 50,000.

According to Section 272B of Income Tax Act, a penalty of Rs 10,000 can be levied in case PAN is not quoted or furnished as required by the Income Tax Law. Under the provisions, a penalty could be imposed for every such non-compliance.

Explaining the rule, Naveen Wadhwa, DGM, Taxmann, said, “A penalty of Rs 10,000 would be levied on each default. Suppose, PAN of Mr A becomes inoperative. He makes payment to a hotel in cash for an amount exceeding Rs 50,000 and also makes payment in cash for purchase of foreign currency for an amount exceeding Rs 50,000. In this situation, the income tax department can impose penalty of Rs 20,000, i.e., Rs. 10,000 for each default.”

In Budget 2021, the Union government has added a new section 234H in the Income Tax Act, where an individual will have to pay a penalty if PAN and Aadhaar are not linked after the deadline ends. So if an individual misses the deadline, he or she will be liable to pay a penalty not exceeding more than Rs 1,000.

Commenting on the PAN Aadhaar linking deadline, Sujit Bangar, founder Taxbuddy.com said, “Even though deadline for linking of PAN with Aadhar has been extended to March 31, 2022, it’s advisable to completed this linkage as early as possible. Linkage of PAN and Aadhar has lot of benefits like early receipt of refund.”

Your inoperative PAN cards will turn into operative as and when the Aadhaar linking process is complete. If you are not sure whether your PAN is linked to Aadhaar, you can check the status here.

Read all the Latest Business News here

What's your reaction?

Comments

https://rawisda.com/assets/images/user-avatar-s.jpg

0 comment

Write the first comment for this!