Income Tax: PAN or Form-60 now mandatory for all money transactions

These amendments are part of the government’s crackdown on black money hoarders and an attempt to plug all the loopholes in the system, they said.

Under Rule 114B modified by the CBDT on Jan 6, if a person has neither a PAN nor a declaration Form-60 at the time of opening a bank account, he/she has to complete the formalities and possess one of these two documents by Feb 20, 2017.

“The Income Tax rule 114C puts the responsibility on the banking officials to verify the PAN number and to check whether it is valid or not. But, providing for this information is not merely the responsibility of the officials, but also the duty of every good citizen of the country," said  Priyabrata Pramanik, Additional
Director of Income tax Intelligence and Criminal Investigation.

“It is now mandatory for all banks and co-operative services to collect the PAN number or the Form-60 in its absence, and link it with the cash deposits, uploading it on Form 61A on the website. The last date for uploading this information is Jan 31,” added Pramanik.

“Details of deposits made from April 1 to Nov 8 will be linked to deposits made after the demonetisation to link the two. We will analyse the deposit patterns of the people who had made small deposits initially, but deposited large amounts in the last few months. This too has to be done by Jan 31.”

“Banks now must mention the PAN number whenever they furnish us with relevant financial information, in accordance with the rules and changes in Form 61A by the CBDT notification from Jan 6. These rules are applicable for all banks, and all forms of accounts, be it savings, current, joint, etc,” said Vikram Sahay, Director of Income Tax.

“Irrespective of whether a person has to file a return of income, for certain high valued transactions, it is equally mandatory to own and quote a PAN. Even if a person has four different accounts, the cash deposits will be seen as an aggregate.”

“However, for people below the non taxable income, they should fill up a declaration in Form-60 and furnish the bank with it. But unfortunately, many people misuse this provision and the psyche is that if you don’t quote the PAN, you will not be caught. That is absolutely contrary to reality because we at the Directorate go through all kinds of verification for different financial transactions and cash deposits,” said the Director.

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(Reporting by Tanushree Sen)