Guidelines for PAN applications
1.1 Whether it is mandatory for a non-resident Indian to have a PAN?
Every person who is required to file a return of income or intends to enter into an economic or financial transaction where quoting of PAN is mandatory must have a PAN.
Transactions in which quoting of PAN is mandatory are as follows:
1) Sale or purchase of any immovable property valued at five lakh rupees or more or sale or purchase of a motor vehicle or vehicle (other than two wheeler vehicles).
2) Making a time deposit with a banking company exceeding fifty thousand rupees or deposit in Post Office Savings Bank Accounting exceeding fifty thousand rupees.
3) In an application for telephone connection including cellular telephone.
4) Payment in cash for purchase of bank drafts or pay orders or banker's cheques for an amount aggregating to fifty thousand rupees or more during any one day or deposit in cash aggregating to fifty thousand rupees or more with a bank during any one day.
5) A contract of a value exceeding one lakh rupees for sale or purchase of securities.
6) Opening of a bank account.
7) Payment to hotels and restaurants against their bills for an amount exceeding twenty-five thousand rupees at any one time.
8) Payment in cash in connection with travel to any foreign country of an amount exceeding twenty-five thousand rupees at any one time.
9) Making an application for issue of credit card or debit card.
10) Payment of an amount of fifty thousand rupees or more to a Mutual Fund for purchase of its units.
11) Payment of an amount of fifty thousand rupees or more to a company for acquiring shares issued by it.
12) Payment of an amount of fifty thousand rupees or more to a company or an institution for acquiring debentures or bonds issued by it;
13) Payment of an amount of fifty thousand rupees or more to the Reserve Bank of India.
14) Payment of an amount aggregating to fifty thousand rupees or more in a year as life insurance premium to an insurer.
15) Payment to a dealer :
(i) of an amount of five lakh rupees or more at any one time; or
(ii) against a bill for an amount of five lakh rupees or more for purchase of bullion or jewellery
1.2 Application for allotment of PAN:
A non-resident Indian ('NRI') can apply for PAN by submitting the Form No. 49A along with the requisite documents and prescribed fees at the PAN application center of UTIITSL or NSDL. He can also make an online application through the website of UTIITSL or NSDL.
1.3 Documents to be enclosed along with PAN application Form
NRI is required to submit the copy of passport (alongwith PAN application Form) as proof of identity. He is also required to submit any of the following documents (alongwith PAN application Form)as proof of address:
a) Copy of passport; or
b) Copy of the bank account statement in country of residence; or
c) Copy of NRE bank account statement (showing at least two transactions in last six months period and duly attested by Indian Embassy/Consular office/high commission or Apostille or by the manager of the bank in which the account is held. The applicant may be a joint holder).
1.4 Foreign address
A foreign address can be provided as residential and office address by NRIs applicants, if they do not have any Indian address of their own.
1.5 Fees
Fees for processing of PAN application shall depend on the communication address provided by the applicant. Fee for processing of PAN is Rs. 105 if the communication address is within India, and Rs. 971 (Application fees +dispatch charges) if the communication address is outside India.
1.6 Correction of Mistakes in PAN card
All guidelines as followed while filling fields of name, address, signature, etc., of PAN application form should also be followed while filling up form for 'Request for New PAN Card or/and Changes or Correction in PAN Data".
There are two modes for filing this form: (1) Offline mode, i.e., submitting the application at the PAN application center of UTIITSL or NSDL, or (2) Making an online application through the website of UTIITSL or NSDL. The applicant has to submit the application along with the related documents and the prescribed fees.
1.7 Penalty for holding more than one PAN card
A person cannot hold more than one PAN. A penalty of Rs. 10,000shall be imposed under section 272B of the Income-tax Act, 1961 for having more than one PAN. If a person has been allotted more than one PAN then he should immediately surrender the additional PAN card(s).
1.8 Penalty for non-compliance with provisions relating to PAN
Section 272B provides for penalty in case of default by the taxpayer in complying with the provisions relating to PAN, i.e., not obtaining PAN, even though he is liable to obtain PAN or knowingly quoting incorrect PAN in any prescribed document in which PAN is to be quoted or intimating incorrect PAN to the person deducing tax or person collecting tax. Penalty of Rs. 10,000 under section 272B can be levied.
CA Niraj Mahajan
nirajdmahajan@gmail.com
Pune, India
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