The Central Board of Direct Taxes has announced that all unlinked PAN cards by June 30, 2021 will be declared as “inoperative”. Does this apply to Non-Resident Indian (NRI) PAN cards? NRI’s were made eligible to get their Aadhaar cards only recently and a lot of them have not visited India since then due to Covid restrictions etc. Please clarify the situation because if NRI’s PAN cards are made inoperative from 1/7/21 they will not be able to file their tax returns and do other financial transactions.
Section 139AA of the Income-tax Act. 1961 (‘the Act’) provides for linking of Aadhaar with PAN. As per the provisions of section 139AA(1) and 139AA(2), every person who is eligible to obtain Aadhaar number, shall quote / link Aadhaar, as may be applicable to him. In case of a failure to do so, the PAN allotted to such person shall be made inoperative. Vide notification dated March 31, 2021, the Central Board of Direct Taxes (‘CBDT’) had extended the date for such till June 30, 2021. This date has now been extended to September 30, 2021 vide notification no S.O. 2508(E) dated June 25, 2021.
Under section 139AA(3), the Government may exempt certain class or classes of persons from the applicability of above requirement. In this relation, the Government had issued a notification dated 11 May 2017, vide which certain categories of person who do not possess Aadhaar or have not applied for Aadhaar, have been exempted from the requirement of linking their Aadhaar with PAN, which includes, but not limited to:
– a non-resident (as per the provisions of the Act);
– Foreign citizen.
Thus, a non-resident shall not be required to obtain Aadhaar and the PAN shall continue to hold valid. However, for cases where the non-resident individual already holds Aadhaar, then the PAN is required to be linked by September 30, 2021, else the PAN may be rendered inoperative.
The writer is a practising chartered accountant
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