Know the reasons for extending the linking of PAN and Aadhaar number to 30.09.2019

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After the introduction of provision in Income Tax Act, 1961 requiring the linking of PAN with Aadhaar number, the Government of India on many occasions announced the last date for linking of the two only to extend the date after date. Recently, also the last date for linking the PAN and Aadhaar Number is extended to 30th September 2019. 



In this article, we will analyze the reason for such an extension. It is important to note that this is for the first time the extension was notified by issuing notification as mandated in the law.

The Finance Act, 2017 introduced a new section 139AA in the Income Tax Act, 1961 under which linking of PAN and Aadhaar number was made mandatory. Failure to link the duo will make the PAN invalid and it will be presumed that the persons do not have any PAN under the law. The section also provided that all the new PAN application shall contain the Aadhaar number or Aadhaar Enrolment ID if no Aadhaar number is allotted and the new PAN will be automatically linked with Aadhaar number at the time of issue of PAN. Those who were allotted PAN before 01st July 2017, the date from which this section was made operative, shall mandatorily link their PAN and Aadhaar number within the date notified for the purpose. Thereafter, the government announced 31st July 2017 as the last date for linking the PAN with Aadhaar number. The date was later extended for one month to 31st August 2017. Again, the date was extended till 31st December 2017 only to extend further till 31st March 2018. Again the date was extended to 30th June 2018 which was further extended to 31st March 2019. The main reason for making the extension of dates for linking PAN and Aadhaar number at that time was pending a case challenging the constitutional validity of Aadhaar before the Hon’ble Supreme Court of India.


PAN & AADHAAR LINKING DATE IS EXTENDED BY NOTIFICATION:

Hon’ble Supreme Court decided the case in September 2018 and upheld the validity of Section 139AA of the Income Tax Act, 1961. Therefore it was presuming that 31st March 2019 will not be extended further. To a surprise, the CBDT, the apex body of Income Tax, issued a Notification No. 31/2019 at the night of 31st March 2019 and further extended the time to link PAN with Aadhaar number till 30th September 2019. This is for the first time the last date to link PAN and Aadhaar number was notified by issuing a notification. A circular No. 6/2019 was also issued simultaneously on 31.03.2019 according to which quoting of Aadhaar number or Enrolment ID for getting Aadhaar number while filing Income Tax Returns was made mandatory.

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The reason for such extension may be that till 31.03.2019 no date was notified by issuing a notification which is a statutory requirement. Section 139AA(2) states that “Every person who has been allotted permanent account number as on the 1st day of July, 2017, and who is eligible to obtain Aadhaar number, shall intimate his Aadhaar number to such authority in such form and manner as may be prescribed, on or before a date to be notified by the Central Government in the Official Gazette:”

The other prominent reason for the extension is that many PAN holders, around 2 crores in number, did not link their PAN and Aadhaar number till 31.03.2019 as can be verified from the statistical data provided on the home page of income tax e-filing website. According to the e-filing website, Individual registered users on e-filing website (they must have the PAN because PAN is the user Id for every registered user on e-filing website) was 7,92,70,008 out of which 5,97,50,659 had linked their PAN and Aadhaar number. On this count alone 1,95,19,349 registered users still did not link their PAN with Aadhaar number which stands at around 25 percent of total Individual registered users. Though the e-filing website did give data as to how many unregistered Individuals are there who have PAN but given that 2,57,53,907 non-registered Individuals have linked their PAN and Aadhaar number. Screenshot of the home page of income-tax e-filing website is given hereunder.


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Conclusion:

Hope that this time on 30.09.2019 we will not see a further extension of date for linking of PAN and Aadhaar number and this will put an end to the practice of ‘tareekh pe tareekh!” for linking of PAN and Aadhaar number.


Update:

Once again the CBDT has extended the date for linking of PAN and Aadhaar number from 30.09.2019 to 31.12.2019 by Notification No. 75/2019 dated 28.09.2019.

The date for linking of PAN and Aadhaar number is further extended from 31.12.2019 to 31.03.2020 by Notification No. 107/2019 dated 30.12.2019.


Download CBDT Notification here
Download CBDT Circular here

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1 Comments

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