Govt notifies date after which PAN will be invalid if not linked to Aadhaar

The government through an announcement on March 31, 2019, has informed the date after which your PAN will become unacceptable if in the case not linked to Aadhaar. 

According to the notice, the last date to link PAN with Aadhaar is September 30, 2019, and according to the rules if PAN is not linked with Aadhaar by this date, then PAN will become unacceptable. "The Notification delivers the sunset date for linking of Aadhaar with PAN. Pursuant to the told announcement, the entire taxpayers seizing a valid PAN on 1 July 2017 are thankful to link their PAN with Aadhaar on or rather than 30 September 2019.

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The default can promote to the annulment of PAN", speaks Shalini Jain, tax partner, individuals’ consultative services, EY India. The prior time limit to link PAN and Aadhaar were March 31, 2019, but, without any clearance as amongst chartered accountants and lawful professionals as to whether PAN will become sedentary if not linked with Aadhaar by March 31, 2019. This is because according to sub-section (2) of section 139AA of the Income Tax Act, the last date of linking was to be informed by the government through a notice in the official gazette only and there was no journal notice informing the time limit of March 31 for this determination. March 31 had been revealed as the time limit only through circulars and notices.

S Vasudevan, Partner, Lakshmi Kumaran&Sridharan Attorneys speak, “The time limit for Aadhar-PAN linking has been static to be 30.09.2019 by way of Notice No. 31/2019 delivered under section 139AA(2) of the Income-tax Act, 1961. This time limit implements to the people who were seizing PAN as on 01.07.2017. It confirms our vision that earlier to this notice, lawfully there was no time limit for linking Aadhar with PAN for such cases. If Aadhar-PAN linking is not completed by 30.09.2019, then PAN will be considered to be invalid. We have faith this notice sets at rest all the misunderstanding that was formed by prior orders and circulars.” had mainly indicated this deficiency of precision about whether PAN would become illegal if not linked to Aadhaar by the previous time limit of March 31, 2019. Section 139AA of the Income Tax Act states that each individual who has PAN as on July 1, 2017, is necessary to link his/her PAN with his/her Aadhaar number. If the PAN is not linked by Aadhaar by a date to be informed by the government then PAN would become unacceptable. This date has now been notified as September 30, 2019. Once a person's PAN becomes invalid, the individual would be considered not to own a PAN and other supplies of the Income Tax Act will put on.

This can mean drawback of Rs 10,000 under section 292B, the higher inference of TDS due to non-accessibility of PAN Etc. Section 139AA also involves required mentioning of Aadhaar while applying for novel PAN card and also while filing an income tax return. The announcement moreover makes it clear that quoting and linking of PAN with Aadhaar while filing ITR is mandatory with effect from April 1, 2019, regardless of the time limit of September 30, 2019, being after the normal due date for filing ITR. EY's Jain additional explains:

"The Spherical elucidates that taxpayers will be obligatory to mandatorily estimate Aadhaar in all returns of income well-appointed on or after 1 April 2019. Returns filed till 31 March 2019 without mentioning Aadhaar, as a difficulty of allowance, will be administered without affecting any contrary penalties for non-quoting of Aadhaar.

There were vagueness and misperception among the shareholders on the last date of AadhaarPAN linking and its expected opposing penalties. There was a separated sight on the clarification of numerous CBDT orders whereby the date of the agreement was prolonged from time to time till 31 March 2019. The existing Announcement puts the concern at rest by officially informing the dusk date of 30 September 2019 for linking Aadhaar with PAN by all the taxpayers. The Circular further offers assurance on ROIs filed till 31 March 2019 without mentioning Aadhaar not activating adverse penalties. Taxpayers who are necessary to fulfill with Aadhaar-PAN linkage must now do so without further interruption and, if, before 30 September 2019."

Keep in mind the last date to link PAN with Aadhaar will not be appropriate to the following people, only if they do not have Aadhaar number or Aadhaar Enrolment ID: a) Non-resident Indians according to the Income Tax Laws b) Not a citizen of India c) Is of age 80 years or additional at whatever time throughout the tax yeard) Inhabitant of the states of Assam, Meghalaya and Jammu and Kashmir Section 139AA was introduced in the Income Tax Act by Budget 2017. This section makes it obligatory to link PAN with Aadhaar.

The Supreme Court while safeguarding the legitimate legitimacy of Aadhaar has also supported the obligatory linking of PAN with Aadhaar.

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