Permanent Account Number (PAN) [Section 139A] :
(1) Sub-section (1) requires the following persons, who have not been allotted a permanent account number (PAN), to apply to the Assessing Officer within the prescribed time for the allotment of a PAN –
(i) Every person whose total income or the total income of any other person in respect of which he is assessable under this Act during any previous year exceeded the basic exemption limit; or
(ii) Every person carrying on any business or profession whose total sales, turnover or gross receipts exceeds or is likely to exceed ` 5 lakh in any previous year; or
(iii) Every person who is required to furnish a return of income under section 139(4A). [Subsection (1)].
(2) A person who has already been allotted a PAN under sub-clauses (i), (ii) or (iii) of subsection (1), is not required to obtain another PAN under sub-clause (iv). The PAN already allotted to him shall be deemed to be the PAN in relation to fringe benefit tax.
(3) The Central Government is empowered to specify, by notification in the Official Gazette, any class or classes of persons by whom tax is payable under the Act or any tax or duty is payable under any other law for the time being is force. Such persons are required to apply within such time as may be mentioned in that notification to the Assessing Officer for the allotment of a PAN [Sub-section (1A)].
(4) For the purpose of collecting any information which may be useful for or relevant to the purposes of the Act, the Central Government may notify any class or classes of persons, and such persons shall within the prescribed time, apply to the Assessing Officer for allotment of a PAN [Sub-section (1B)].
(5) The Assessing Officer, having regard to the nature of transactions as may be prescribed, may also allot a PAN to any other person (whether any tax is payable by him or not) in the manner and in accordance with the procedure as may be prescribed [Sub-section (2)].
(6) Any person, other than the persons mentioned in (1) to (5) above, may apply to the Assessing Officer for the allotment of a PAN and the Assessing Officer shall allot a PAN to such person immediately.
(7) The CBDT had introduced a new scheme of allotment of computerized 10 digit PAN. Such PAN comprises of 10 alphanumeric characters and is issued in the form of a laminated card.
(8) All persons who were allotted PAN (Old PAN) earlier and all those persons who were not so allotted but were required to apply for PAN, shall apply to the Assessing Officer for a new series PAN within specified time.
(9) Once the new series PAN is allotted to any person, the old PAN shall cease to have effect. No person who has obtained the new series PAN shall apply, obtain or process another PAN.
(10) Quoting of PAN is mandatory in all documents pertaining to the following prescribed transactions:
(a) in all returns to, or correspondence with, any income-tax authority ;
(b) in all challans for the payment of any sum due under the Act;
(c) in all documents pertaining to such transactions entered into by him, as may be prescribed by the CBDT in the interests of revenue. In this connection, CBDT has notified the following transactions, namely:
(i) sale or purchase of any immovable property valued at Rs 5 lakh or more;
(ii) sale or purchase of motor vehicle or other vehicle (other than two wheeled motor vehicle) which requires registration under section 2(28) of the Motor Vehicle Act, 1988;
(iii) a time deposit exceeding Rs 50,000 with a banking company;
(iv) a deposit exceeding Rs 50,000 in any account with Post Office Savings Bank;
(v) a contract for sale or purchase of securities exceeding value of Rs 1 lakh;
(vi) opening a bank account;
However, in case the person making the application is a minor who does not have any income chargeable to tax, he is required to quote the PAN of his father or mother or guardian, as the case may be.
(vii) making an application for installation of telephone connection (including cellular telephone connection);
(viii) bill payments to hotels and restaurants exceeding Rs 25,000 at any one time;
(ix) payment in cash for purchase of bank drafts/pay orders/banker‘s cheque from a banking company for an amount aggregating Rs 50,000 or more during any one day;
(x) cash deposit aggregating Rs 50,000 or more with a banking company during any one day;
(xi) cash payment in excess of Rs 25,000 in connection with travel to any foreign country at any one time. Such payment includes cash payment made towards fare, or to a travel agent or a tour operator, or for the purchase of foreign currency. However, travel to any foreign country does not include travel to the neighbouring countries or to such places of pilgrimage as may be specified by the CBDT under Explanation 3 to section 139(1);
(xii) making an application to any bank or banking institution or company or any institution for issue of a credit card;
(xiii) making an application for the following purposes involving payment of an amount exceeding Rs 50,000 –
(a) for purchase of units of a mutual fund;
(b) for acquiring shares of a company through public issue;
(c) for acquiring debentures of a company or institution;
(d) for acquiring bonds of Reserve Bank of India.
(11) Every person who receives any document relating to any transaction cited above shall ensure that the PAN is duly quoted in the document.
(12) If there is a change in the address or in the name and nature of the business of a person, on the basis of which PAN was allotted to him, he should intimate such change to the Assessing Officer.
(13) Every person who receives any amount from which tax has been deducted at source shall intimate his PAN to the person responsible for deducting such tax.
(14) Where any amount has been paid after deducting tax at source, the person deducting tax shall quote the PAN of the person to whom the amount was paid in the following documents:
(i) in the statement furnished under section 192(2C) giving particulars of perquisites or profits in lieu of salary provided to any employee;
(ii) in all certificates for tax deducted issued to the person to whom payment is made;
(iii) in all returns made to the prescribed income-tax authority under section 206;
(iv) in all statements prepared and delivered or caused to be delivered in accordance with the provisions of section 200(3)[Sub-section (5B)].
(15) The above sub-sections (5A) and (5B) shall not apply to a person who –
(i) does not have taxable income or
(ii) who is not required to obtain PAN
if such person furnishes a declaration under section 197A in the prescribed form and manner that the tax on his estimated total income for that previous year will be nil.
(16) The CBDT is empowered to make rules with regard to the following:
(a) the form and manner in which an application for PAN may be made and the particulars to be given there;
(b) the categories of transactions in relation to which PAN is required to be quoted on the related documents;
(c) the categories of documents pertaining to business or profession in which PAN shall be quoted by every person;
(d) the class or classes of persons to whom the provisions of this section shall not apply;
The following classes of persons are exempt from the provisions of section 139A:
(i) persons who have agricultural income and are not in receipt of any other taxable income;
(ii) non-residents under the Act, provided that any non-resident entering into any of the prescribed transactions shall furnish a copy of his passport.
(e) the form and manner in which a person who has not been allotted a PAN shall make a declaration;
(f) the manner in which PAN shall be quoted for transactions cited in (b) above;
(g) the time and manner in which such transactions shall be intimated to the prescribed authority.