PAN – Permanent Account Number, an important
financial document in today’s time. It is mandatory to quote your PAN for
various financial transactions to curb black money. It is also a valid ID proof for everything
from sim card application to hotel reservations, etc.
But did you know, if you use PAN card as an
Identity proof where not mandated by the government, there are chances that it
can be misused to commit financial frauds, crimes and forgery. It can be used
to carry out benami transactions.
What is PAN?
It is a code that acts as identification of
Indians, especially those who pay Income Tax. It is a unique, 10-character
alpha-numeric identifier, issued to all judicial entities identifiable under
the Indian Income Tax Act 1961.
Where is it mandatory?
As per Income Tax India below are the
transaction where it is mandatory:
· Sale or purchase of
any immovable property valued at five lakh rupees or more
· 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
· A time deposit, exceeding
fifty thousand rupees, with a banking company
· A deposit, exceeding
fifty thousand rupees, in any account with Post Office Savings Bank
· A contract of a
value exceeding one lakh rupees for sale or purchase of securities
· Opening a bank
account
· Making an
application for installation of a telephone connection (including a cellular
telephone connection)
· Payment to hotels
and restaurants against their bills for an amount exceeding twenty-five thousand
rupees at any one time
· 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
· Deposit in cash
aggregating fifty thousand rupees or more with a bank during any one day
· Payment in cash in
connection with travel to any foreign country of an amount exceeding
twenty-five thousand rupees at any one time
· Making an
application for issue of credit card or debit card
· Payment of an amount
of fifty thousand rupees or more to a Mutual Fund for purchase of its units
· Payment of an amount
of fifty thousand rupees or more to a company for acquiring shares issued by it
· Payment of an amount
of fifty thousand rupees or more to a company or an institution for acquiring debentures
or bonds issued by it
· Payment of an amount
of fifty thousand rupees or more to the Reserve Bank of India
· Payment of an amount
aggregating fifty thousand rupees or more in a year as life insurance premium
to an insurer
· Payment to a dealer for
purchase of bullion or jewellery–
o
of an amount of five
lakh rupees or more at any one time; or
o against, a bill for an amount of five lakh rupees
or more,
What are the
alternatives?
You can use any of the other ID proofs you
hold at places where PAN is not mandatory. Any of the valid ID proofs like
Voter’s ID, Driving Licence, Aadhaar Card, etc.
TIP:
If you are not holding any other ID proofs
and you have to submit you PAN copy. Make it a habit of mentioning the person you are handing it
over to, purpose, the date and then sign below it.
Eg. Submitting PAN copy for XYZ Credit Card;
Mention- submitting to XYZ co. for credit
card application on 01/01/2015 and then your signature.
