Training Presentation

Working Effectively and Accurately

All About PANBy

Choksi Tax Services

Structure Permanent Account Number (PAN) is a ten-digit alpha-

numeric number, issued by the Income Tax Department. Each assesse (e.g., individual, firm, company, etc.) is issued a unique PAN.

PAN enables department to link all transactions of the ‘person’ with the department.

These transactions include tax payments, TDS / TCS credits, returns of income / wealth / gift, specified transactions, correspondence, etc.

PAN, thus, acts as an identifier for the ‘person’ with the tax department.

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PAN structure is as follows: AAAAA9999A. First five characters are letters, next four are numerals, last is a character letter

If PAN does not follow the above structure, PAN will be shown as invalid

The fourth character of the PAN must be one of the following, depending on the type of assesse:

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C – Company P – Person H – HUF (Hindu

Undivided Family) F – Firm A – Association of

Persons (AOP) T – AOP (Trust) B – Body of Individuals

(BOI) L – Local Authority J – Artificial Judicial

Person G – Government

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The fifth character of the PAN is the first character of the surname / last name of the person (in case of personal PAN card, the fourth character is “P”) or of the name of Entity / Trust / Society / Organisation

Register / Track PAN Card Related Complain / Status Income Tax Department has started a website namely Sparsh India

to help Assesse to Register theisr complain related to PAN Card applied through NSDL or UTIISL and they can also check the status of their grievance online. 

Nature of Complain may be any of the following:-

Nature of Complaint Neither PAN Number nor PAN Card Received PAN Card Not Received (PAN Number Received) Returned Undelivered (RUD) Name Mismatch Photo Mismatch Father’s Name Mismatch Other

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Assessee can file their complain online at the link given below :-

http://incometax.sparshindia.com/pan/PAN.asp?id=1

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Assessee can check the status of PAN Grievance at the link given below :-

http://incometax.sparshindia.com/pan/PAN.asp?id=2

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What is PAN? Permanent Account Number (PAN) is a ten-

digit alphanumeric identifier, issued by Income Tax Department. Each assessee (e.g. individual, firm, company etc.) is issued a unique PAN.

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What fourth and fifth digit of PAN signifies?

4TH & 5TH DIGIT OF PAN NO. HERE IT IS: ASSUME PAN NO. IS AAASA1234A

AAA I S I A I 1234 I A 5 4 3 2 1

1.Alphabetic check Digit2.Sequential number running from 0001 to 99993.First character of assessee’s last name/surname4.Status5.Alphabetic series running from AAA to ZZZwww.choksitax.com

Permanent Account Number (PAN) is a ten-digit alphanumeric identifier, issued by Income Tax Department. Each assessee (e.g. individual, firm, company etc.) is issued a unique PAN.

1-5 field are alpha(A to Z)6-9 field are numeric(0-9)10 field is alpha(A-Z)

Forth field of pan denotes assessee status :for individual=”P”for Company=”C”for Trust =”T”for partnership firm=”F”Body of Individual:”B”

Association of persons:”A”HUF=”H”Local authority:”L”Govt.=”G”judicial artificial person:”j”

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2.Fifth field of PAN denotes NAME In case of individual: Surname/last name(as

given in pan application)for ex. in case of Ram Kumar(individual)5th field will be “K”4th field will be “P”In case of Ram Kumar Gupta(Individual)5th field will be “G”4th field will be “P”

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In case of All Other Assesees (not confirmed for all the assessee)5th field will be first letter of Name/first Namefor ex : In case of Suresh Jindal (HUF)(confirmed)5th field will be “S”(first letter of First name i.e Suresh)4th field will be “H”(for Huf)

for ex: in case of ABB LTD(confirmed)5th field will be “A”(first letter of First name)

4th field will be “C”(for company)

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Who can apply for PAN? All existing assessees or taxpayers or persons

who are required to file a return of income, even on behalf of others, must have a PAN. Any person, who intends to enter into economic or financial transactions where quoting PAN is mandatory, must also have a PAN.

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Who can apply on behalf of minor, lunatic, idiot, mentally retarded, deceased and wards of court?

Section 160 of IT Act, 1961 provides that a minor, lunatic, idiot, mentally retarded, deceased, wards of court and such other persons may be represented through a Representative Assessee.

In such cases, In the application for PAN, details of the a

minor, lunatic, idiot, mentally retarded, deceased, wards of court, etc. should be provided.

Details of representative assessee have to be provided in item 14 of the application for PAN

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Is it compulsory to quote PAN on ‘return of income’?

Yes, it is compulsory to quote PAN on return of income.

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Do I need to apply for a new PAN when I move from one city to another? Permanent Account Number (PAN), as the

name suggests, is a permanent number and does not change

Changing the address though, may change the Assessing Officer. Such changes must, therefore, be intimated to ITD so that the PAN database of ITD can be updated.

One can intimate change in address by filling up the form for Request for New PAN Card or/and Changes or Correction in PAN data.

This form can be submitted at any TIN-FC or online at NSDL-TIN website.

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Can I obtain or use more than one PAN? Obtaining/possessing more than one PAN is

against the law and may attract a penalty upto Rs.10,000.

Therefore it is advisable not to obtain/possess more than one PAN.

If you have more than one PAN, you should surrender the unused PAN by logging into ITD website at www.incometaxindia.gov.in

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How do I apply for PAN?

You can apply for PAN by filling up Form 49A: Application for Allotment of Permanent Account Number (PAN application form).

You can also apply for PAN online through NSDL-TIN website.

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Can I make an application for PAN on plain paper? No. Application for PAN can be made only in

Form 49A notified by Central Board of Direct Taxes on 29.05.2003.

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Where can I obtain application form for PAN (Form 49A)? You can obtain the application form for PAN

(Form 49A) in the format prescribed by Income Tax Department from TIN-Facilitation Centers (TIN-FCs), any other stationery vendors providing such forms or from NSDL-TIN website.

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Are there any charges for obtaining Form 49A? The form is freely downloadable from NSDL-

TIN website. You can also obtain the form from TIN-FCs.

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Where should I submit my PAN application? You can submit your duly filled and signed PAN

application form along with the supporting documents to any of the TIN-FCs or PAN Centers managed by NSDL.

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What are the charges to be paid while submitting Form 49A?

You have to pay Rs.94 (plus service tax, as applicable) to TIN-FCs as processing fees while submitting Form 49A.

If address for communication is a foreign address, the fee payable is Rs. 744 (including service tax).

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What will I receive on submission of the PAN application form to a TIN-FC? You will receive an acknowledgment with a

unique 15 digit acknowledgment number on submission of the PAN application form.

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How can I enquire about the status of my application? You can inquire the status of your application

by accessing NSDL-TIN website at the “Status track” option and quoting your unique 15-digit acknowledgement number after three days of your application.

You can also obtain status of your application through SMS (Short messaging service) using mobile phones. For this, you have to type the word “PAN” followed by your 15-digit acknowledgement number and send it to 53030. For example: SMS PAN 012345678901234 to 53030.

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How do I fill the application form 49A? You should fill the application form legibly in

English capital letters with black ink. You should read all the instructions before

filling up Form 49A.

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Is a photograph compulsory for making an application for PAN? ‘Individual’ applicants should affix a recent

colour photograph (size 3.5 cm x 2.5 cm) in the space provided on the form.

The photograph should not be stapled or clipped to the form.

The applicant should not sign across the photograph. The clarity of image on PAN card will depend on the quality and clarity of photograph affixed on the form

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What documents should I submit along with the application form? You have to submit the following documents

with the application form:A] Proof of identity (POI)B] Proof of address (POA)The documents for POI and POA depend on the citizenship and the status of the applicant.

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Which documents will serve as proof of identity in case of individual applicants and HUF applicants?

Individual and HUF Applicants who are citizens of India and located within India at the time of application for PAN: Copy of any one of the following will serve as a proof of identity:

School leaving certificate Matriculation certificate Degree of recognized educational institution Depository account statement Valid Credit card Bank account statement Water bill Ration card Property tax assessment order Passport Voter’s identity card Driving license Certificate of identity signed by a Member of Parliament or Member of

Legislative Assembly or Municipal Councilor or a Gazetted Officer.

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Note: Document being submitted should be in the

full name of the applicant as mentioned in the PAN application.

In case the PAN applicant is a minor, any of above documents of any of the parents or guardian of such minor shall serve as proof of identity.

In case PAN application is made on behalf of a HUF, any of above documents in respect of karta of the HUF will serve as proof of identity.

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2. Citizen of India located outside India at the time of application for PAN: Copy of passport will serve as a proof of identity

3. Foreign Citizen located in India at the time of application for PAN :- Copy of passport and Copy of Person of Indian Origin (PIO) card issued by Government of India will serve as a proof of identity.

4. Foreign Citizen located outside India at the time of application for PAN :- Copy of any one of the following will serve as a proof of identity:

Passport Other National ID attested by Indian

Embassy/Consulate/High Commission/Apostille Person of Indian Origin (PIO) card issued by Government of

India

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What documents should be submitted as proof of address for individual applicants and HUF applicants? Individual and HUF Applicants who are citizens of India and located

within India at the time of application for PAN: Copy of any one of the following will serve as a proof of address:

Electricity bill* Telephone bill* Depository account statement* Credit card statement* Bank account statement* Rent receipt* Employer certificate* Ration card Passport Voter’s identity card Property tax assessment order Driving license Certificate of address signed by a Member of Parliament or Member of

Legislative Assembly or Municipal Councilor or a Gazetted Officer.

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Note: For serial numbers 1 to 7, proof of address should not be more

than six months old from the date of application. Document being submitted should be in the full name of the

applicant as mentioned in the PAN application. In case the PAN applicant is a minor, any of above documents of

any of the parents or guardian of such minor shall serve as proof of address.

In case PAN application is made on behalf of a HUF, any of above documents in respect of Karta of the HUF will serve as proof of address.

It is mandatory for individuals and HUF to mention their residential address on the PAN application and to submit valid proof of the same.

If office address is selected as communication address by Individual and HUF applicants, then POA for office address is also required.

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Citizen of India located outside India at the time of application for PAN :-

Copy of any one of the following will serve as a proof of address:

Passport Bank account statement in country of

residence NRE bank account statement**

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Foreign Citizen located in India at the time of application for PAN :-

Copy of any one of the following will serve as a proof of address:

Passport Bank account statement in India Residential permit issued by the State Police

Authorities Registration certificate issued by the Foreigner’s

Registration Officer Person of Indian Origin (PIO) card issued by

Government of India NRE bank account statement**

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In case ‘Office Address (of India)’ is mentioned in application made by foreign citizens , then it is mandatory to provide all five documents mentioned below as proof for office address.

Copy of Visa application to Indian authorities + Copy of Visa granted + Copy of appointment letter/contract from Indian Company + Certificate (in original) of address in India of applicant issued by authorized signatory of employer on employer’s letter head mentioning the PAN of the employer + copy of PAN card for the PAN mentioned in the employer’s certificate.www.choksitax.com

Foreign Citizen located outside India at the time of application for PAN :- Copy of any one of the following will serve as a proof of address:

Passport Other National ID attested by Indian

Embassy/Consulate/High Commission/Apostille Bank account statement in country of

residence, duly attested by Indian Embassy/High Commission / Consulate / Apostille in the country where applicant is located

Person of Indian Origin (PIO) card issued by Government of India

NRE bank account statement**

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Note: Showing at least two customer induced

transactions in last six months period and duly attested by Indian Embassy / Consular office / High commission or Apostille or by the manager of the bank in which the account is held. The applicant may be a joint holder.

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Which documents will serve as proof of identity and address for applicants other than individual and HUF?

List of documents which are acceptable as proof of identity and address for applicants other than individual and HUF is as below:

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Having office of their own in India

Type of Applicant Documents for proof of identity and address

Company Copy of certificate of registration issued by Registrar of Companies.

Firms Copy of certificate of registration issued by Registrar of firms orCopy of Partnership Deed.

AOP (Trusts) Copy of trust deed orCopy of certificate of registration number issued by Charity Commissioner.

AOP/BOI/Local Authority/Artificial Juridical Person Copy of agreement orCopy of certificate of registration number issued by Charity Commissioner /Registrar of Co-operative Society / any other Competent Authority orany other Document originating from any Central / State Government Department establishing identity and address of such person.

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Having no office of their own in India

Type of Applicant Documents for proof of identity and address

Company/Firms/AOP (Trusts)/AOP/ BOI/Local Authority/Artificial Juridical Person

Copy of registration certificate of the respective country duly attested by Indian Embassy in the country where applicant is located orCopy of certificate of registration with the competent authority in India orCopy of approval issued by the competent authority in India orCopy of the accompanying documents alongwith the approval issued by competent authority in India orCopy of the application (duly acknowledged) made by the applicant before the competent authority in India.

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What is the procedure for applicants who cannot sign?

In such cases, Left Hand Thumb Impression (preferably in black ink) of the applicant should be taken on Form 49A/change request form at the place meant for signature.

This should be attested by a Magistrate or a Notary Public or a Gazetted Officer, under official seal and stamp.

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Is father’s name compulsory for female applicants (including married/divorced/widow)?

Female applicants, irrespective of their marital status, should write only father’s name in the PAN application form.

There is no provision to mention husband’s name in the application

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Is it compulsory for me to mention telephone number/email id on application Form 49A?

Either the telephone number or the email should be mandatorily mentioned in the application

When the telephone number is mentioned, it is necessary to mention the STD code. In case of mobile number, country code should be mentioned as STD code. When the telephone is provided by WLL service providers, the STD code should be mentioned.

If email id is mentioned, PAN will be communicated on email id when it is allotted by the Income Tax Department.

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How to surrender/Cancel extra /Additional PAN Online / Manually?

An assessee may have been allotted multiple PAN Card.

The multiple PAN card may have been allotted to the Assessee for many reasons i.e.

He may have applied multiple times for allotment of PAN and every time he has been allotted a PAN card or may have inadvertently allowed multiple PAN card by Income tax Department , NSDL or UTI.

Assessee who have more than one PAN should immediately Apply for surrender of additional PAN number(s) allotted to them as having more than one PAN may make them liable to a penalty of Rs. 10,000/-

Assessee can apply for surrender of PAN card by two methods.

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Manually Write a letter to this effect to the assessing officer under whose

jurisdiction you have been filing your returns.

The letter must contain details such as your name, contact details, details of the PAN card to be retained, details of the duplicate PAN card(s) which you need to surrender, etc.

Keep  the acknowledgement copy of the letter that you have filed with the I-T department, stating that you are surrendering your additional PAN.

That is sufficient as proof of surrender and no additional confirmation from the I-T authorities is required.

On receipt of the acknowledgement, there is no need for you to wait for intimation from the income tax department considering that the PAN submitted has now been cancelled by them.

The acknowledgment copy of the letter submitted will more than solve the purpose.

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Manually Fill the Form No. 49A for change/Correction in correction in PAN and submit the same at your nearest UTI pan centers or NSDL TIN Facilitation centers.

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Online Visit the Following Link and fill the detail in the

online Form given at the link and following the instructions

http://incometax.sparshindia.com/pan/newPAN.asp

You can also surrender the pan online  by filing a application “change in pan data ” through UTI pan centers or NSDL TIN Facilitation centers.In application fill spare pan number in Last row of the Form.

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No penalty for quoting wrong PAN if caused by negligence of

deductee

In the instant case, the ITO(TDS) while going through the quarterly return in Form No.26Q, filed by the assessee noted that it has omitted to quote PAN/had quoted invalid PAN in 196 cases.

As regards the reasonable cause, it was pleaded on behalf of the assessee that TDS was deducted and deposited in time in government Treasury.

The default is only with regard to the wrong quoting of PAN of 196 of the deductees, such deductees quoted wrong PAN.

However, correct PAN was given as soon as default was brought to the notice of the assessee.

In this case, the CIT(A) has categorically observed that the assessee deducted TDS correctly and revised PAN and filed the revised statement on form No.

26G, hence there was sufficient compliance of the provisions of section 139A. There is no dispute that the assessee quoted invalid PAN for 196 deductees which was corrected on being pointed out by ITO(TDS).

In the instant case, failure to quote right PAN has occurred as the concerned depositor had misquoted PAN. There is also no dispute that the PAN was corrected after ascertaining the same from the respective deductees.

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It was further held that cumulative analysis of Section 139A and Rules 114B to 114D shows that an obligation to quote PAN/GIR number or to file Form No.60 is that of customer and not that of the bank.

Considering the entire facts and circumstances of the present case, and also keeping in view the decision of ITAT, Ahmedabad “D” Bench in the case of Financial Cooperative Bank Limited v. ITO, Ward 2(3), Surat (supra), we hold that there was reasonable cause of the default,if any committed by the assessee and hence no penalty under section 273B of the Act is leviable.

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