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In a significant move, the Indian government has deactivated approximately 11.5 crore Permanent Account Number (PAN) cards after their holders failed to meet the Aadhaar linking deadline on June 30. This information was revealed in a response to a Right to Information (RTI) query filed by Madhya Pradesh activist Chandra Shekhar Gaur.
According to the RTI, out of the 70.24 crore PAN card holders in the country, 57.25 crore had successfully linked their PAN with their Aadhaar numbers. However, over 12 crore PAN cards remained unlinked, resulting in the deactivation of 11.5 crore of these cards.
The requirement for the linkage is based on Section 139AA of the Income Tax Act, which mandates every person allotted a PAN as of July 1, 2017, to provide their Aadhaar number. The deactivation of the PAN cards means that affected individuals would not be able to conduct financial transactions that require a PAN.
Furthermore, the Central Board of Direct Taxes (CBDT) has implemented a fee of ₹1,000 for reactivating the deactivated PAN cards. This fee has raised concerns among some, including Mr. Gaur, who highlighted the disparity between the cost of issuing a new PAN card (₹91 excluding GST) and the penalty for reactivation.
Questions have also been raised about how those with deactivated PAN cards will be able to file their income tax returns. In response to these concerns, Mr. Gaur has urged the government to consider extending the deadline for linking PAN with Aadhaar by at least one year.
Previously, CBDT had extended the linking deadline to June 2023 while also providing details on the consequences of failing to link by the notified date. This extension was intended to give PAN holders ample time to comply with the requirements.
The latest development indicates a strict adherence to regulations by Indian authorities, emphasizing the importance of linking the two identity documents as part of larger efforts to streamline financial and tax-related processes.
