The government has made it mandatory to link the existing Aadhaar numbers with the PAN cards of taxpayers with effect from July 1, 2017. In fact, Section 139AA of the Income-tax Act, 1961, as introduced by the Finance Act, 2017, provides for mandatory quoting of Aadhaar / Enrolment ID of Aadhaar application form, for filing of return of income and for making an application for allotment of Permanent Account Number with effect from 1st July, 2017. However, such mandatory quoting of Aadhaar or Enrolment ID shall apply only to a person who is eligible to obtain an Aadhaar number.
As per the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016, only a resident individual is entitled to obtain Aadhaar. Resident as per the said Act means an individual who has resided in India for a period or periods amounting in all to one hundred and eighty-two days or more in the twelve months immediately preceding the date of application for enrolment. Accordingly, the requirement to quote Aadhaar as per section 139AA of the Income-tax Act shall not apply to an individual who is not a resident as per the Aadhaar Act, 2016.
It is clear, thus, that the requirement to quote Aadhaar shall not apply to an individual who is not a resident as per the Aadhaar Act, 2016. Similarly, the government has also exempted certain people from linking their Aadhaar ID to PAN. The Central government has recently notified that the requirement of quoting of Aadhaar / Enrolment ID shall not apply to the following individuals if they do not possess the Aadhaar / Enrolment ID:
i. An individual who is residing in the state of Assam, Jammu and Kashmir and Meghalaya.
ii. An individual who is a non-resident as per the Income-tax Act, 1961.
iii. An individual of the age of eighty years or more at any time during the previous year.
iv. An individual who is not a citizen of India.
“The linking of Aadhaar with PAN has been made compulsory by the Supreme Court for any individual who holds an Aadhaar ID, thus giving some relief to individuals who have not applied for Aadhaar. However, before the Supreme Court decision, the CBDT had issued a notification exempting certain people from linking their Aadhaar ID to PAN. Individuals from the state of Assam, Jammu & Kashmir and Meghalaya; an NRI or a non-Indian citizen; and a super senior citizen are exempt from linking of Aadhaar number to the PAN card,” says Archit Gupta, Founder & CEO, ClearTax.in.
However, it may be noted that even these people are exempt from Aadhaar-PAN linking only if they do not possess Aadhaar or Enrolment ID currently. So, it seems only a temporary relief.