Soon after the Supreme Court of India upheld Section 139AA of the Income Tax Act,1961, which requires quoting of the Aadhaar number in applying for PAN as well as for filing of income tax returns, as constitutionally valid, the government said that the Aadhaar number or the applicant’s Aadhaar Enrolment ID number will now be mandatorily required for filing of income tax returns as well as for applications for PAN from July 1. The government said that the apex court, in its landmark judgement, has upheld Section 139AA of the I-T Act,1961 as constitutionally valid. “The Hon’ble Court also held that the ‘Parliament was fully competent to enact Section 139AA of the Act and its authority to make this law was not diluted by the orders of this Court.’ Therefore, no violation of the earlier SC orders were found in enacting the provision.”
It said that the apex court has also held that Section 139AA of the Act is not discriminatory nor it offends equality clause enshrined in Article 14 of the Constitution. Also, Section 139AA is not violative of Article 19(1)(g) of the Constitution in so far as it mandates giving of Aadhaar number for applying PAN and in the income tax returns and linking PAN with Aadhaar number.
It may be noted that Section 139AA(1) of the I-T 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 PAN with effect from July 1, 2017. Moreover, Section 139AA(2) of the I-T Act provides that every person who has been allotted PAN as on the 1st day of July, 2017, and who is eligible to obtain Aadhaar, shall intimate his Aadhaar on or before a date to be notified by the Central government. The proviso to section 139AA (2) provides that in case of non-intimation of Aadhaar, the PAN allotted to the person shall be deemed to be invalid from a date to be notified by the Central government.
Now, apart from upholding Section 139AA(1), the apex court has also upheld Section 139AA(2) which requires that the Aadhaar number must be intimated to the prescribed authority for the purpose of linking with PAN.
“It is only the proviso to Section 139AA(2) where the SC has granted a partial stay for the time being, pending resolution of the other cases before the larger bench of the Supreme Court,” the government said.
Keeping this in view, this is what the SC judgement means:
1) From July 1, 2017 onwards, every person eligible to obtain Aadhaar must quote his/her Aadhaar number or Aadhaar Enrolment ID number for filing of I-T returns as well as for PAN applications;
2) Every person who has been allotted PAN as on July 1, and who has Aadhaar number or is eligible to obtain Aadhaar number, will intimate his/her Aadhaar number to the income tax authorities for the purpose of linking PAN with Aadhaar;
3) However, for non-compliance of the point No (2), only a partial relief by the SC has been given to those, who do not have Aadhaar and who do not wish to obtain Aadhaar for the time being, that their PAN will not be cancelled so that other consequences under the I-T Act for failing to quote PAN may not arise.
4) Thus, according to experts, if you want to file your income tax return or want to apply for PAN card before July 1 can do so even if you do not have an Aadhaar card. The taxmen will also not cancel your PAN card if you do not have your Aadhaar. However, this is only a partial relief provided by the Supreme Court.