The Income Tax (I-T) Department on Saturday issued an advisory that those Permanent Account Numbers (PAN) which were not linked with Aadhaar by the end of March next year would be rendered “inoperative”.

“What is mandatory is necessary. Don’t delay, link it today!” the department said in a public advisory. 

“As per Income-tax Act, 1961, it is mandatory for all PAN-holders, who do not fall under the exempt category, to link their PAN with Aadhaar before 31.3.2023. From 1.04.2023, the unlinked PAN shall become inoperative,” it said.

The exempt category, according to a notification issued by the Union Finance Ministry in May 2017, are those individuals residing in Assam, Jammu and Kashmir and Meghalaya; a non-resident as per the Income-tax Act, 1961; of the age of 80 years or more at any time during the previous year and a person not a citizen of India. 

A circular issued by the Central Board of Direct Taxes (CBDT) on March 30 had said that once a PAN became inoperative, an individual should be liable to all the consequences under the I-T Act and would have to suffer a number of implications. 

The person would not be able to file I-T return using the inoperative PAN; pending returns would not be processed; pending refunds would not be issued to inoperative PANs; pending proceedings as in the case of defective returns would not be completed once the PAN was inoperative; and tax would be required to be deducted at a higher rate.