Holding multiple PAN cards? Know the consequences and what you should do - Taxsure Consultancy Services


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Friday, June 22, 2018

Holding multiple PAN cards? Know the consequences and what you should do

Holding multiple PAN cards? Know the consequences and what you should do

The Assessing Officer may levy a penalty of a sum of Rs 10,000 to a person holding multiple PAN cards.

Last year, Sunil Kumar from Delhi had a bad credit history and was unable to get a home loan from banks he applied to. He decided to apply for another PAN card consulting his friend with the objective of creating a dual identity for himself. He did this fraudulent and illegal exercise intentionally to erase bad credit history and apply for home loan. There are lakhs of people across India like Sunil Kumar doing this fraudulent exercise and cases are registered against them.

Intentionally or unintentionally many end up with multiple PAN cards
Anubhav Jain, Co-Founder and Head of Risk, Qbera.com said, “Often people intentionally apply for more than one PAN card for the purpose of reducing their tax burden by splitting up their income and assets. Others do it to enter into financial transactions based on fraudulent documents as they have mala fide intentions.” People do this in the hope that a new PAN card will give them a clean chit on their past bad repayment behaviour with respect to loans or credit card debt.
Unintentionally, many end up with multiple PAN cards because they are unaware that doing so is illegal. Anubhav Jain shared a couple of instances, “When someone loses their card, they apply for a fresh one instead of requesting a duplicate. Often, women change their maiden names after marriage, here they apply for a new PAN card whereas they should be requesting for an update in information on their original card itself.”
Shalini Jain, Tax Partner, EY India added, “Other examples could be NRIs coming to India for work and apply for a PAN. When they revisit India again after say few years, unintentionally, they may end up applying of PAN again.”

Application for multiple PAN cards should be discouraged
The PAN application process typically requires one to enter some of the basic details like name, mobile number, date of birth, address, father's name, etc. Unfortunately, any of this information can be manipulated quite easily to create a new identity and thus apply for multiple PAN cards. “However, with the mandatory linking of one’s Aadhaar and PAN card numbers, identifying such cases has become much easier for the government, thereby discouraging such illegal activity,” said Anubhav Jain.
Consequences of holding multiple PAN cards with different numbers
Shalini Jain pointed out, “As per Section 139A of Income Tax Act, 1961 a person can hold only one PAN.” As per Section 272B, the Assessing Officer may levy a penalty of a sum of Rs 10,000 to a person who fails to comply with the provision of Section 139A which would include holding multiple PAN cards.
Prior to levying the penalty, the Assessing Officer will provide a hearing to the individual. Shalini Jain said, “If the individual can explain to the Assessing Officer that multiple PAN was acquired unintentionally, it is possible the penalty of Rs 10,000 is not levied on the individual.”
Methods to surrender / cancel additional PAN cards
Surrendering and cancelling additional PAN cards has been made quite simple today. It is possible using both online and offline process.
- Online process
One needs to visit the NSDL website and submit the ‘PAN Change Request’ application form. Anubhav Jain explained, “You need to mention the single PAN card that you intend to keep using and cancel all the rest. The additional PAN numbers that you choose to surrender have to be mentioned in item no.11 along with the corresponding PAN card copies.”
- Offline process
If you aren’t very comfortable with the online route, you can also surrender your additional PAN cards offline by filling up form 49A available on NSDL website to download and print. Fill up this form with the necessary details of the PAN cards to be cancelled and submit it at your nearest UTI or NSDL TIN facilitation centre.
Do remember to take an acknowledgement of the same. You will need to follow this up with a letter to the Assessing Officer in your jurisdiction. Anubhav Jain said, “This letter must contain the details of the PAN card to be retained and those of the ones that need to be cancelled, along with duplicate copies as well as the acknowledgement from UTI or NSDL TIN.”
Merely following the online or offline process for PAN card cancellation does not ensure that the PAN will be cancelled. Shalini Jain clarified, “The individual may have to visit his/ her jurisdictional Assessing Officer to convince that the additional PAN was inadvertently acquired.”

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