Income Tax, Aadhaar and PAN: How to link, correct name mismatch issues

Key Highlights 

• SC has upheld the law making Aadhaar a must for filing income tax returns for those who have it and its linkage to PAN card.
• Those who have a PAN but have not yet got Aadhaar can still file their income tax returns this year.
• The government cannot stop enrolment of people for new PAN cards yet, SC clarified.

Apex court of India on Friday upheld a law that made linkage of the Aadhaar card to a citizen’s permanent account number (PAN) mandatory along with its use in filing income tax returns, for those who hold it.

Supreme Court upheld the validity of Section 139AA of the Income Tax Act which will make Aadhaar mandatory for allotment of PAN cards and linking the filing of Income Tax returns.

"Section 139AA(2) of the Income Tax Act provides that every person who has been allotted PAN as on the 1st day of July, 2017, and who is eligible to obtain Aadhaar, shall intimate his Aadhaar on or before a date to be notified by the Central Government," SC said. 

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It further clarrified that the judgement was in no violation of previous provisions made by the court. “Parliament was fully competent to enact Section 139AA of the Act and its authority to make this law was not diluted by the orders of this Court,” SC said.

The SC defended its judgement by stating that the decision would be a step forward in tackling the menace of corruption and black money.

A PTI report quoted SC bench who said, “It is mentioned that in de-duplication exercises, 11.35 lakhs cases of duplicate PANs/fraudulent PANs have been detected. Out of these, around 10.52 lakhs pertain to individual assesses. Parliament in its wisdom thought that one PAN to one person can be ensured by adopting Aadhaar for allotment of PAN to individuals. As of today, that is the only method available i.E. By seeding of existing PAN with Aadhaar."

“Those assessees who are not Aadhaar card holders and do not comply with the provision of Section 139(2), their PAN cards be not treated as invalid for the time being," SC clarified.

This only means that those who do not hold an Aadhaar card currently do not need to produce it at the time of filing returns.

"It becomes clear from the aforesaid discussion that those who are not PAN holders, while applying for PAN, they are required to give Aadhaar number. This is the stipulation of sub-section (1) of Section 139AA, which we have already upheld," SC added.

SC further clarified that the government cannot scrap PAN enrolment for people who do not yet have an Aadhaar card. "However, those assessees who are not Aadhaar card holders and do not comply with the provision of Section 139(2), their PAN cards be not treated as invalid for the time being," SC said.

The court will be hearing the case on privacy concerns related to Aadhaar soon.

"Everyone who has been allotted permanent account number as on the 1st day of July, 2017, and who has aadhaar number or  is eligible to obtain Aadhaar number, shall intimate his Aadhaar number to  income tax authorities for the purpose of linking PAN with Aadhaar," SC said.

Name mismatch on Aadhaar & PAN card

If you have a slightly different name on your Aadhaar and PAN card, the Income Tax Department had eased rules to link the two cards last month.

Here's how you can do it:

1. Taxpayers can go to www.incometaxindiaefiling.gov.in.

2. Click on the link on the left pane-> Link Aadhaar

3. Provide PAN, Aadhaar no. and ENTER NAME EXACTLY AS GIVEN IN AADHAAR CARD (avoid spelling mistakes) and submit.

4. After verification from UIDAI, the linking will be confirmed.