Are you among those who are eligible to hold a PAN card but do not have one? Then you should be alert to the possibilities of being slapped with a high penalty by the Income Tax (I-T) Department anytime soon. Moreover, you will be also held liable to pay a fine in case you have tampered with your details while filling in the application form for the Permanent Account Number (PAN).
According to a statement released on the Income Tax Department website - "Penalty of Rs 10,000 under section 272B can be levied. The section 272B of IT Act, provides for penalty in case of default by the taxpayer in complying with the provisions relating to PAN, i.e., not obtaining PAN even when s/he is liable to obtain PAN or knowingly quoting incorrect PAN in any prescribed document or intimating incorrect PAN to the person deducting tax or person collecting tax".
Permanent Account Number (PAN), the ten-digit unique alphanumeric number encrypted in a laminated plastic card, ensures customers do not face any difficulty while doing major transactions through their bank accounts. A netizen who is 18 years old or above may drop a request for the Permanent Account Number (PAN). Securing a PAN card makes various important services like bank deposits, bank account opening, application for the passport, payment in stocks, savings account, investment in mutual funds, application for higher studies much easier. It is also considered to be a valid photo identity proof while travelling, appearing for an examination, casting vote or for various other purposes.
As per the Income Tax Department, people fulfilling the below-mentioned criteria should obtain a PAN card:
1. Every person needs it if his total income or the total income of any other person in respect of which he is assessable during the year exceeds the maximum amount which is not chargeable to tax.
2. A charitable trust is required to furnish returns under Section 139(4A).
3. Every person who is carrying on any business or profession whose total sale, turnover, or gross receipts are or is likely to exceed five lakh rupees in any year.
4. Every importer/exporter who is required to obtain the Import-Export code.
5. Every person who is entitled to receive any sum/income after deduction of tax at source.
6. Any person who is liable to pay excise duty or a producer or manufacturer of excisable goods or a registered person of a private warehouse in which excisable goods are stored and an authorized agent of such person.
7. Persons who issue invoices under Rule 57AE requiring registration under Central Excise Rules, 1944.
8. A person who is liable to pay the service tax and his agent.
9. Persons registered under the Central Sales Tax Act or the general sales tax law of the relevant state or union territory.
10. Every person who intends to enter into specified financial transactions in which quoting of PAN is mandatory.