What is interchangeability can be understood by the fact that from now on, if someone does not have PAN, he or she can furnish the Aadhaar number.
PAN-Aadhaar Interchangeability: The interchangeability of Permanent Account Number (PAN) and Aadhaar has been notified by the government. Effective September 1, either PAN or Aadhaar Number can be used in the various forms used for income tax purposes. Earlier, the Budget 2019 announcements made by the Union Minister of Finance Nirmala Sitharaman had proposed to make the use of PAN and Aadhaar interchangeable. The Ministry of Finance has issued a notification G.S.R. 825 (E) dated November 6, 2019 that on the basis of the power conferred by section 139A, read with section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes (CBDT) has made the new rules to amend the Income-tax Rules, 1962. The government has carried amendments in the various set of income tax forms and also certified that no person is being adversely affected by giving retrospective effect to these amendment rules.
What is interchangeability can be understood by the fact that from now on, if someone does not have PAN, he or she can furnish the Aadhaar number. For common taxpayers, this means, filing of income tax return (ITR) without PAN will become easier by quoting the Aadhaar Number. Aadhaar can be substituted with PAN wherever the former is to be quoted compulsorily.
It is mandatory to file the ITR if the total income exceeds the basic exemption limit in a financial year. The new rule makes it easier to substitute PAN with Aadhaar number wherever the PAN is to be compulsorily provided. Not only while filing of ITR, but also the PAN is mandatorily required to be quoted in the case of certain high-value transactions made by the person or while depositing cash in the bank or making deposits above a certain limit and for certain other financial transactions.
The rules to amend the Income-tax Rules, 1962 will apply to various forms such as Form Nos. 3AC, 3AD, 8, 10CCB, 10CCBA, 10CCBB, 10CCBBA, 10CCBC etc and for the words and letters ‘Permanent Account No.’, wherever they occur, the words ‘Permanent Account Number or Aadhaar Number will be substituted.