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Mandatory requirement of PAN in certain transaction

Permanent Account Number (PAN) is required to mandatorily furnish in certain cases –

  1. Sale or purchase of any immovable property valued at five lakh rupees or more.
  2. Sale or purchase of a motor vehicle or vehicle, [the sale or purchase of a motor vehicle or vehicle does not include two wheeled vehicles, inclusive of any detachable side-car having an extra wheel, attached to the motor vehicle.
  3. A time deposit, exceeding fifty thousand rupees, with a banking company
  4. A deposit, exceeding fifty thousand rupees, in any account with Post Office Savings Bank.
  5. A contract of a value exceeding one lakh rupees for sale or purchase of securities.
  6. Payment to hotels and restaurants against their bills for an amount exceeding twenty-five thousand rupees at any one time.
  7. Payment in cash for purchase of bank drafts or pay orders or banker’s cheques for an amount aggregating fifty thousand rupees or more during any one day.
  8. Deposit in cash aggregating fifty thousand rupees or more with a bank during any one day.
  9. Payment in cash in connection with travel to any foreign country of an amount exceeding twenty-five thousand rupees at any one time.
  10. Payment of an amount aggregating fifty thousand rupees or more in a year as life insurance premium to an insurer.
  11. Payment to a dealer of an amount of five lakh rupees or more at any one time or against a bill for an amount of five lakh or more for purchase of bullion or jewellery.

If any person who does not have a PAN and who enters into any transaction specified in this rule, shall make a declaration in Form No. 60

There are certain cases in which PAN is not mandatory but restricts the person from many benefits

  1. Form 15G/15H cannot be filed.
  2. All persons which are required to deduct TDS from your income are required to deduct TDS at the rate of 20%.

 

About Prateek Agarwal

I am Chartered Accountant by profession, practicing in Jaipur. I have interest in accounting and taxation field.

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