PAN
Introduction
All organizations which are required to furnish return of income
under section 139(4A) and (4C) should apply for a Permanent Account
Number (PAN). As the name suggests, it is a taxpayer’s permanent
identification number allotted by the income-tax department. PAN
once allotted remains valid forever unless it is cancelled or changed
by the department. PAN number has 10 alphanumeric characters and
issued in the form of a laminated card”.
How to apply for PAN
The application for allotment of PAN is required to be made in
a revised format of Form No. 49A, the acknowledgement of the application
is returned to the applicant after affixing the official stamp by
the department. The application for PAN should be accompanied by
the proof of identity and address of the applicant. The PAN application
is to be made to the assessing officer who has been specifically
assigned by the income-tax department to carry out such function.
Why NGO should have PAN
Under the existing law, it is absolutely necessary for all income-
tax assessees to quote PAN in the following documents:
(i) In the income-tax return and in all other correspondences with
the income-tax department.
(ii) In all challans for payment of any tax, interest and penalty
due under the Income-tax Act.
(iii) In all documents related with the following transactions:
(a) Sale or purchase of any immovable property in excess of Rs.
5,00,000/-.
(b) Sale or purchase of a motor vehicle other than a two wheeler.
(c) A time deposit exceeding Rs. 50,000/- with a bank.
(d) A deposit exceeding Rs. 50,000/- in any account with a Post
Office.
(e) Sale or purchase of shares, stocks and other securities in excess
of Rs. 10, 00,000/-.
(f) Opening of a bank account.
(g) Applying for a telephone connection including cellular phone
connection.
(h) Payment to hotels and restaurants in excess of Rs. 25,000 at
a time.
Further, if any part of the income of the assessee is liable to
deduction of tax at source, the assessee is required to intimate
his PAN to the person responsible for deducting tax at source.
Penalty for not having PAN
The Voluntary Organizations which fail to comply with the provisions
of section 139A are subjected to penalty under section 272B, inserted
by the Finance Act, 2002. A sum of Rs.10000 by way of penalty can
be levied on such organizations after giving a reasonable opportunity
of being heard. It may be noted that penalty is leviable not only
for not applying for PAN, but also for (i) failure to quote PAN
in the prescribed documents, or (ii) failure to intimate such PAN
when required, or (iii) quoting or intimating a number which is
false. Penalty is however not leviable if the assessee proves that
there was reasonable cause for the failure.
Click here for form 49A
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