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Yogi Zone

Useful articles for your finance management by our team of experts

apply for pan card with caution now

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apply for pan cardIt would be better if you apply for your Permanent Account Number (PAN) with great care. Yes this is not a prank, Income tax authorities are gearing up to make the laws all the more stringent, therefore it will not be easy for you to get hold of a  PAN card. The new measures are taken into consideration so that the cases of frauds in recent times are dealt with much stricter hand.

What can be the change now?

Earlier rental receipts were accepted by the tax authorities as a supporting document of PAN card application but the officials are now planning to do away with these receipts and will instead ask for the rent agreement as a proof of address of the applicant. Similarly, ration cards will not be accepted as a proof of identity; in this place IT department may now ask for more authentic proofs like AADHAR card, LPG or PNG connection documents or any verified certificate issued by the employer on behalf of his employee. The officials can now ask for a proof for date of birth.

Why has the step been taken?

This measure has been taken in order to address the issues of fake identifications that were being used by foreign nationals particularly Afghanistan and other neighbouring countries. This came to the notice of ‘Economic Offences Wing’ recently. It was being done by showing fake certificates of identity. The notification on the full proof plan could be issued by the income tax dept. in July, after which the new procedure to issue PAN will come into existence. This is expected to be stricter than the current scheme of arrangement.

Know Your Customer (KYC):

Until now, there was no prescribed format in which the authorities had to issue the certificates for Identity and address. Apart from bank statements, voter id’s and passports, etc there were certificates issued by Member of Parliament, MLA and gazette officer that was treated as a residential and identity proof. However, there will be a prescribed format from now on for Permanent Account Number verification. The IT department plans to make this similar to the banking Know Your Customers (KYC) norms.

Increase the reach:

The increasing transparency in PAN card issuance will allow the Income Tax authorities to increase their net on the people not filing tax returns deliberately. Close to two lakh PAN cards are issued each year while the detailed record of very few is verified by the department. After the measure, it is expected to increase the revenues of the exchequer and will reduce the usage of fake bank accounts and ID proofs.

The exercise of checking that a tax payer is not issued multiple cards is also on. This will be done by taking into account the mismatch of people having PAN card and people actually filing the returns. The examination done by third party professionals revealed that large number of PAN cards was issued on the basis of fake documents. The challenge for the department is to make sure that the multiplicity is removed from the system with the usage of revised application forms is underway.

In case of wrong issuance of PAN:

Although there have been a spree of measures adopted by the Income Tax department to increase the authenticity of the account holder, there have been many instances where the department has issued wrong PAN card to the applicants. Remember that the onus will still be on you to submit the documents if you require any changes made in your existing card. Had you got the PAN card on the basis of fake documents, there is a possibility that your position will be revealed if you submit this document as a proof for changes. It is advised that you submit the credentials as per Rule 114 of Income Tax Act, which has given 13 documents each that are accepted as Identity and Address evidence.

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