The income tax officer can impose a penalty of Rs 10,000 on the concerned person if he possesses more than one PAN cards.
As per the situation, if you possess more than one Permanent Account Numbers (PANs), whether you acquired them intentionally or accidentally, you get caught in a real dilemma. You might be penalised and even might be criminalised in some cases.
But don’t panic. Here are the remedies to solving the aforesaid dilemma of having 2 PAN numbers. But before that let’s recall the various provisions of the Income Tax Act 1961.
Section 139 A
Section 139 A of the Income Tax Act, 1961 is concerned with the eligibility criteria to apply for the PAN, when an individual should quote it and so on. As per the aforesaid section, a person can possess only one PAN. As per the seventh provision of the aforesaid Section 139 A, “No person who has already been allotted a permanent account number under the new series shall apply, obtain or possess another permanent account number.”
Section 272 B
As per this section, the income tax officer can impose a penalty of Rs 10,000 on the concerned person if he possesses more than one PAN. On an in-depth examination of this section,
# The penalty imposed is discretionary — If a person is found to have 2 PAN cards, it depends on the income tax officer to decide whether to levy a fine or not. The criteria of decision making is to know the real intention of a person having two PAN cards.
# This section further says that the defaulter (who has 2 PANs) shall be given the opportunity of being heard. The reason being, he might have committed the fault unintentionally in a hurry or for avoiding hassles or for some other cause which is unavoidable.
For Instance, an NRI comes to India and applies for a PAN. In a hurry to honour his commitments abroad, he again moves out of the country and when he revisits the income tax office after 5 years, he reapplies for PAN.
Another instance is as follows — a person has been issued the PAN 10 years back. Now he has moved to a new address but his PAN card shows the old address. In such a case, the formalities for address change might be very complex and to avoid hassles, he may apply for a new PAN and shall have 2 PANs now. Here the intention of an individual is not wrong but he has committed fault to avoid an error.
However, there may be cases where an individual has applied for a second PAN fraudulently. For instance, an individual might have applied for PAN intentionally for getting a loan when he has lost credibility. In such a case, he may become the offender along with the imposition of a penalty of Rs 10,000.
How to apply for the surrender of a PAN Card when an individual has 2 PAN Cards?
There is a prescribed procedure to submit one PAN card out of 2 PAN cards to the income tax department as mentioned in the Income Tax Act 1961. However, in the era of Information and Communication Technology, there are 2 ways to apply for surrender of Card — Online Method and Offline Method.
The method of submitting a PAN card to the Income Tax Department is similar to the procedure that is followed in the correction and surrender of the PAN card.
Step 1: Visit the website of NSDL b clicking the before-mentioned URL
Step 2: Click the PAN correction option from the online application and fill out personal details. Submit the form.
Step 3: After submitting the form, you would be redirected to a new page. And a new token number shall be created and shown to the applicant before filling the form. The aforesaid token number shall also be sent on your e-mail id which you have entered in the first step
Step 4: On top of the page click the option ‘Submit scanned images through e-Sign’.
Under this option mention that PAN number you want to retain (not the one you want to surrender).
Fill out the personal details in the left part and click next. The Fields marked with * are compulsory to fill.
Note: Never select the corresponding check box on the left margin of the given field. The reason being, this option is for the “correction of details”
Step 5: On the bottom of the next page, mention the additional PANs accidentally allotted to you (enter the PAN number you want to surrender) and click on next.
After submission, you shall get a preview of your application form. Verify the details in the preview form, edit the form.
Step 6: Payment
The fee is Rs 110 for communication address within India and Rs 1020 for payment outside India.
Mode of Payment: Payment can be made either by
# Demand Draft (in favour of “NSDL-PAN) payable at Mumbai. Don’t forget to enter the name of the applicant and the acknowledgement number on the reverse of the demand draft.
# Credit or Debit Card
# Internet Banking
Step 7: Acknowledgement
After making the payment, an acknowledgement that is downloadable shall be displayed on the screen. Take the print and send the acknowledgement to NSDL e-Gov.
The individual applicant who wants to apply for surrender ought to affix 2 photographs in the space that is furnished in acknowledgement and cross sign it in such a way that one portion of the signature is on the photo and one portion is on the acknowledgement receipt.
Note: If the person applying is not the individual, the acknowledgement shall be signed by
- Karta in the case of HUF,
- Partner in case of Partnership Firm / LLP
- Director in case of Company,
- Trustee in case of Trust and
- Authorized signatory in remaining categories).
Step 8: Submission
Superscribe the envelope with ‘Application for PAN cancellation’ along with the acknowledgement number.
Step 9 (Last Step) Following items should be submitted to the below mentioned postal address
- The acknowledgement duly signed, affixed with photographs along demand draft, if any,
- Proof of existing PAN,
- Proof of identity,
- Proof of address,
- Proof of date of birth
Has to be sent to the following address:
National Securities Depository Limited(NSDL) e-Gov at ‘Income Tax PAN Services Unit, NSDL e-Governance Infrastructure Limited, 5th Floor, Mantri Sterling, Plot No. 341, Survey No. 997/8, Model Colony, Near Deep Bungalow Chowk, Pune – 411 016.
For surrender of the additional PAN card offline, you ought to present the PAN correction form at the nearest collection centre of NSDL and also file a letter with the concerned jurisdictional Assessing Officer while listing the duplicate PAN details and requesting for the cancellation of the same.
In some cases, the Assessing Officer might be requiring an affidavit that mentions the current PAN and states that an individual does not possess any PAN other than the present one that is in use and the PAN card that has been surrendered.
Column 11 of this form shall ask you to mention the PAN which you desire to surrender. A Xerox copy of the aforesaid PAN should also be submitted along with the application.
1. While making an online application, the duly signed acknowledgement along with essential documents ought to reach the office of the NSDL within 15 days after submitting the online form in the said time.
2. It is worth mentioning that the PAN correction form is used as a multi-tasker, i.e. making corrections in PAN, reissuing of PAN without correction and surrendering additional PAN, so be careful while filling the form.
3. There’s a likelihood that Income Tax officials shall undertake investigation. So, be prepared.
4. Just filling out the online form does not guarantee that your additional PAN shall be cancelled. You might have to visit the concerned Assessing Officer for convincing him that your additional PAN was accidentally acquired.
5. One should be prepared to face questions from income tax officials. Similarly, you might have to convince assessing officials if it is required.
(By Amit Gupta, MD, SAG Infotech)