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Govt made Adhaar & Pan card compulsory to open accounts
May 12, 2022
The govt has made it compulsory to quote either Adhaar or Pan card for opening a current account. The CBDT notification, in a notification, said furnishing the PAN number or biometric Adhaar will be compulsory for such high-value deposits or withdrawals from banks in a financial year, or opening of a current account or cash credit account with a bank or post office.
Commenting on the move, AKM Global Tax Partner Sandeep Sehgal said this shall bring more transparency to financial transactions where banks, post offices, and co-operative societies would be required to report the transactions of deposits and withdrawals aggregating to ₹20 lakh or more in a financial year.
“Further, the mandatory condition of obtaining PAN for deposits and even for withdrawals would help the government in tracing the movement of money in the system. All in all, this would tighten the entire process of suspicious cash deposits and withdrawals with the current TDS provision u/s 194N under the Income-tax Act, 1961,” Sehgal said.
Currently, PAN and Aadhaar are interchangeable for income tax purposes.
An assessee needs to mention their Pan in every communication with the I-T department and while entering into specified financial transactions.
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