10.52 lakh bogus PAN cards cannot be termed miniscule number to harm economy: Supreme Court

It made the observations while upholding the validity of section 139AA of the Income Tax Act making Aadhaar mandatory for allotment of PAN cards and filing of tax returns. The court, however, put a partial stay on its implementation till its Constitution Bench addressed the larger issue of right to privacy related to Aadhaar.

By: PTI | New Delhi | Published:June 11, 2017 10:21 am
aadhaar, supreme court aadhaar, aadhaar judgment, pan card, income tax, income tax filing, income tax returns, aadhaar pan card, pan card ITR, CBDT, supreme court Section 139AA of the Act provides for mandatory quoting of Aadhaar or enrolment ID of Aadhaar application form for filing of income tax returns and making application for allotment of PAN with effect from July 1 this year.

As many as 10.52 lakh “bogus” PAN cards of individual income tax assesses, which is around 0.4 per cent of the total such documents, cannot be termed a “minuscule” number to harm the country’s economy, the Supreme Court has said.

The apex court said that it has come on record that 11.35 lakh duplicate or fraudulent permanent account numbers have been detected and out of these, 10.52 lakh cases pertain to individual assesses. It made the observations in a 157-page judgement while upholding the validity of section 139AA of the Income Tax Act making Aadhaar mandatory for allotment of PAN cards and filing of tax returns. The court, however, put a partial stay on its implementation till its Constitution Bench addressed the larger issue of right to privacy related to Aadhaar.

Section 139AA of the Act provides for mandatory quoting of Aadhaar or enrolment ID of Aadhaar application form for filing of income tax returns and making application for allotment of PAN with effect from July 1 this year. “It was sought to be argued (by the petitioners) that persons found with duplicate/bogus PAN cards are hardly 0.4
per cent and, therefore, there was no need to have such a provision,” a bench headed by Justice A K Sikri said on Friday.

“We cannot go by percentage figures. The absolute number of such cases is 10.52 lakh, which figure, by no means, can be termed as minuscule to harm the economy and create adverse effect on the nation,” the bench, also comprising Justice Ashok Bhushan, said.

Dealing with the submissions advanced by Attorney General Mukul Rohatgi that duplicate PANs were used to divert funds to shell companies, the bench said, “The fact remains that companies are after all floated by individuals and these individuals have to produce documents to show their identity.”

It said if introducing Aadhaar in tax regime was one of the measures to check black money or money laundering, the scheme cannot be “denounced” only because of the reason that the purpose would not be achieved fully. “Such kind of a menace, which is deep-rooted, needs to be tackled by taking multiple actions and those actions may be initiated at the same time. It is the combined effect of these actions which may yield results and each individual action considered in isolation may not be sufficient,” it noted.

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  1. T
    TIHAEwale
    Jul 7, 2017 at 10:46 am
    IE should do a story. income tax dept has banned active PAN on the ground duplicate exists without caring to bother whether Tax payer has used both PANs or one is dormant. the IT Dept in its wisdom blocked both PANs . had they informed this over mail at least the individual would have provision to have correspondence over the red flag. So the PAN holder is forced to meet the AO for no fault of his but due to immature and irrational behaviour of IT Dept. what stops send mail based on details available in their database especially when the PAN holder is paying Rs 120/- more than demand then claiming refund and getting same as his way of ensuring his IT return is assessed.
    Reply
    1. A
      AshitBaran Nag
      Jun 11, 2017 at 11:42 am
      Those citizens who have no adher card like am ,what they will do?
      Reply
      1. M
        MSB
        Jun 11, 2017 at 5:16 pm
        Who prevented you from getting an aadhar? If you really wanted to help the nation, you won't be asking this question. Why not the IT department can't consider you as a cheat?
        Reply