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18 Transactions in which Quoting PAN is Compulsory – Rule 114B

Section 139A(5)(c) of Income tax act states that PAN is required to be quoted on transactions prescribed by CBDT.

Rule 114B of Income Tax Rules states the transactions in which quoting of PAN is compulsory.

A table showing requirement under Rule 114B of Income Tax Act is given below-

Sl no.Nature of Nature of TransactionsValue of Transaction1Motor vehicle (other than two wheeler)All sales/purchases2Opening an account (other than time deposit) with a banking company.All new accounts.3Application for credit card or debit cardAll transactions4 Opening Demat AccountAll transactions5Payment to Hotel/restaurantPayment in cash of an amount exceeding fifty thousand rupees.6Payment in connection with travel to any foreign country or payment for purchase of any foreign currency at any one time.Payment in cash of an amount exceeding fifty thousand rupees.7Payment to a Mutual Fund for purchase of its units.Amount exceeding fifty thousand rupees8Payment to a company or an institution for acquiring debentures or bonds issued by it.Amount exceeding fifty thousand rupees9Payment to the RBI for acquiring bonds issued by itAmount exceeding fifty thousand rupees10Deposit with a banking company or a co-operative bank or post officeDeposits in cash exceeding fifty thousand rupees during any one day11Purchase of bank drafts or pay orders or banker’s cheques from a banking company or a co-operative bankPayment in cash for an amount exceeding fifty thousand rupees during any one day12A time deposit

(i) with a banking company or a co-operative bank (ii) a Post Office (iii) a Nidhi company (iv) a non-banking financial companyAmount exceeding fifty thousand rupees or aggregating to more than five lakh rupees during a financial year13Payment for one or more pre-paid payment instrumentsPayment in cash or by way of a bank draft or pay order or banker’s cheque of an amount aggregating to more than fifty thousand rupees in a financial year14Payment as life insurance premium to an insurerAmount aggregating to more than fifty thousand rupees in a financial year15A contract for sale or purchase of securities (other than shares)Amount exceeding one lakh rupees per transaction16Sale or purchase, by any person, of shares of a company not listed in a recognised stock exchange.Amount exceeding one lakh rupees per transaction17Sale or purchase of any immovable propertyAmount exceeding ten lakh rupees or valued by stamp valuation authority referred to in section 50C of the Act at an amount exceeding ten lakh rupees18Sale or purchase, by any person, of goods or services of any nature other than those specified at Sl. Nos. 1 to 17 of this Table, if anyAmount exceeding two lakh rupees per transaction

A minor entering into any of above transaction and also doesn’t have any income chargeable to tax can quote his father’s, mother’s or guardian’s Permanent Account Number (PAN).

A person who doesn’t have PAN have to file a declaration in Form 60 giving the transactions details.

The provisions of this rule does not applies to the following class or classes of persons

  1. the Central Government, the State Governments and the Consular Offices.

  2. the non-residents referred to in clause (30) of section 2 of the Act in respect of the transactions other than a transaction referred to at Sl. No. 1 or 2 or 4 or 7 or 8 or 10 or 12 or 14 or 15 or 16 or 17 of the Table.

Penalty for Contravention

Section 272B defines the penalty for contravention of above rules.

  1. If a person who is required to collect PAN is unable to do so, Assessing officer may impose penalty of Rs. 10,000.

  2. If a person who is required to quote his PAN quotes a false PAN, Assessing officer may impose penalty of Rs. 10,000.

Assessing officer is required to give an opportunity to being heard before imposing any penalty.

Also Read – Procedure for Surrender Extra PAN Online

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