PAN Card misuse scam

Don't give PAN number for railway Tatkal booking as proof of ID.

The Railways display the PAN. name, sex and age of passengers on reservation charts pasted on railway compartments.

This is a boon for benami transactions. It is mandatory for traders like jewelers to collect tax (TCS) from customers on purchase of jewelry worth Rs 5 lakh & bullion worth Rs 2 lakh.

While complying with TCS rules for collection, payment and uploading of TCS information (e-filing of TDS returns) jewellers have to furnish PAN of customers. For certain customers it is not convenient to provide PAN.

To accommodate high net worth customers, traders have a easy source of benami PAN numbers, name, sex and age from reserved railway compartments. A traveller recently noticed a chap copying PAN particulars along with name, age and sex pasted on reserved compartments, and when confronted with the help of railway police, he admitted that he gets Rs 10 per PAN particulars from jewellers. These persons are copying PAN information of senior citizens, women etc from sleeper class with the intention that passengers in sleeper class are not serious tax payers and generally salaried class.

This wrong usage of a PAN number is known only to the regular tax payers, who regularly check their tax credit on form 26AS provided by the Income Tax department on their website.

This form 26AS is updated only on filing of e-TDS returns by the traders. There is almost 6-12 months time delay for the PAN holder to know that a transaction of above nature has taken place on his name and that too only if he goes through form 26AS.

On noticing the tax credit of above nature while reconciling form 26AS for tax credits for filing the return during subsequent financial year i.e. July / September, the tax payer has an option to exclude the same and go ahead in filing the return.

In that case the department will first initiate action from the tax payer's side asking him to explain the sources of money for the above transaction done in his name and also to prove that he has not carried on the above transaction.

The onus lies on the genuine tax payer for the fault committed by the traders.

This dispute may even take more than 2 years to be settled.

In conclusion, the only way to protect yourself from these fraudulent transactions, is to avoid quoting PAN details for identity proof at any source except for income tax related matters for which your Government had issued for.

You may quote your driving licence , Voter ID etc as your ID Proof but definitely not your PAN.

SOURCE : UNKNOWN/INTERNET