CA NeWs Beta*: PAN CARD-avoid quoting PAN details for identity proof

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Saturday, July 7, 2012

PAN CARD-avoid quoting PAN details for identity proof

Indian Railway has started collecting PAN and other specified identity information in support of Tatkal bookings as per recent direction and are displaying the PAN along with name, sex and age of reserved passengers on the reservation charts pasted on to the railway compartments.
 
This is a boon for benami transactions. Finance Act 2012 has made it mandatory for certain traders like jewellery dealers to collect tax from customers on purchase of jewellery worth Rs.2 lakhs and above. While complying with these rules, jewellery dealers have to furnish PAN of customers. For certain customers it is not convenient to provide PAN as they may have constraints in explaining source (black money or undeclared incomes

etc.,) and in such cases to accommodate high net worth customers, the traders have a easy source of benami PAN numbers with all particulars like name, sex and age from reserved railway compartments.
 
While someone was recently travelling from Bangalore to Hyderabad they noticed certain persons seriously copying PAN particulars along with name, age and sex pasted on to the reserved compartments. and when they were confronted with the help of railway police. they admitted that they are paid
Rs.10 per PAN particulars by jewellery traders.
 
These persons are copying selected PAN information of senior citizens, women etc., only from sleeper class with the intention that passengers in sleeper class are not serious tax payers and generally salaried class.
 
Impact on PAN holders who is a tax payer:
 
This wrong usage of a PAN number will be known to you, only if you regularly check their tax credit on form 26AS, provided by the Income Tax department on their website. There is almost 6-12 months time delay for the PAN holder to know that a transaction of above nature has taken place on his name and that too only if he goes through form 26 AS.
 
In that case the department will first initiate action from the tax payer's side asking him to explain the sources of money for the above transaction done in his name. and also to prove that he has not carried on the above transaction. The onus lies on the genuine tax payer for the fault committed by the traders. This dispute may even take more than 2 years to be settled.
 
 
"In conclusion, best way to protect yourself from these fraudulent transactions, is to avoid quoting PAN details for identity proof"

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