According to new rules by the tax department, one needs to mention PAN details at the time of deposit and withdrawal if the annual aggregate withdrawal is Rs 20 lakh or more in a financial year.
From May 26 onwards, anyone depositing or withdrawing Rs 20 lakh or more from one or more bank accounts in a financial year will have to quote the Permanent Account Number (PAN) at the time of withdrawal.
With a view to curb evasion of taxes through the use of cash, the Central Board of Indirect Taxes (CBDT) has notified amendments to the Income Tax Rules that have made mention of PAN mandatory for those who make high deposits and withdrawals over the cash counter.
The same would apply while opening a current account. This rule is applicable to accounts which may already be linked to a PAN number.New rules will be applicable from May 26.
With this, there is yet another filter in place to ensure that everyone who operates a bank account gets a PAN to make cash transactions of Rs 20 lakh or more.
The notification applied the PAN rule to “cash deposit or deposits aggregating to twenty lakh rupees or more in a financial year, in one or more account of a person with a banking company or a co-operative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act) or a Post Office.
It’s similarly applicable to “cash withdrawal or withdrawals aggregating to twenty lakh rupees or more in a financial year, in one or more account of a person with a banking company or a co-operative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act) or a Post Office.”
It says “every person shall, at the time of entering into a transaction specified in column, quote his permanent account number or Aadhaar number, as the case may be, in documents pertaining to such transaction, and every person specified in column (3) of the said Table, who receives such document, shall ensure that the said number has been duly quoted and authenticated —
The CBDT has prescribed that under the new rule the permanent account number or Aadhaar number alongwith demographic information or biometric information of an individual shall be submitted to the Principal Director General of Income-tax (Systems) or Director General of Income-tax (Systems) or the person authorised by the Principal Director General of Income-tax (Systems) or Director General of Income-tax (Systems) with the approval of the Board, for the purposes of authentication referred to in section 139A.
The Principal Director General of Income-tax (Systems) or Director General of Income-tax (Systems) shall lay down the formats and standards along with procedure for authentication of permanent account number or Aadhaar number.
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