Even though your PAN has not yet become inoperative if it is not linked to the Aadhaar number, as the deadline for it has been extended, it will now be fined for not doing it so far and will stop working if it is not is done until the new deadline of March 31, 2023. If the Permanent Account Number (PAN) stops working, you will not get any major government service anymore.
The issue of the PAN-Aadhaar interlinking started after the Tax Administration was informed that multiple Permanent Account Numbers (PANs) have been assigned to one person or one PAN has been assigned to more than one person.
Last week, the Ministry of Finance said, “Until March 31, 2023, the PAN of the assessees who have not declared their Aadhaar will remain functional for the procedures under the law, such as issuing income refunds, processing refunds, and so on.”
Services affected if PAN is not linked to Aadhaar until March 2023
In a statement on March 30, the Ministry of Finance said: “After March 31, 2023, the PAN of taxpayers who fail to declare their Aadhaar as required will become unusable and all the consequences of the Act (Income Tax Act, 1961) on the failure to provide, indicate, or quote the PAN applies to these taxpayers.”
As part of this, the CBDT issued a circular stating: “Rule 114AAA of the Income Tax Rules states that if an individual’s PAN ceases to work, he will not be able to provide, disclose or quote his PAN and be liable for all consequences under the law for such failure”.
1) The person cannot file a return using the non-functioning PAN
2) Pending returns will not be processed
3) Pending refunds cannot be given to non-functioning PANs
4) Ongoing procedures such as in the case of defective returns cannot be completed once the PAN stops working
5) Tax should be deducted at a higher rate if PAN stops working
Punishment for not linking PAN-Aadhaar so far
The Central Board of Direct Taxes (CBDT) said in a notice last week that those who have not linked their Aadhaar and PAN numbers until now will be subject to a fine of Rs 500 if done within three months and Rs 1,000 if they are done afterwards. However, the PAN remains operational for the time being, even though it is not linked to Aadhaar.
The notice released on March 30 reads: “Anyone who, in accordance with the provisions of subsection (2) of Section 139AA, is required to communicate his Aadhaar Number in the prescribed form and manner to the prescribed authority.” give, fail to do so. thus not later than the date mentioned in the said subsection, at the time when his Aadhaar Number is subsequently disclosed to the prescribed authority, he shall owe as compensation an amount equal to:- (a) five hundred rupees, in the case where such notice is given within three months of the date referred to in subsection (2) of Section 139AA; and (b) a thousand rupees, in all other cases.”
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