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PAN holds back action on returns

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Monica Gupta New Delhi
Last Updated : Feb 06 2013 | 6:11 AM IST
Nearly 30% of transactions under AIR do not have relevant PANs.
 
It may be a while before finance ministry is able to act on the information contained in the 2,500 returns under the annual information returns (AIR) collected up to December 2005. This is because nearly 30 per cent of the 17,00,000 transactions under AIR do not have the relevant permanent account number (PAN).
 
"Until December 2004, the mandatory quoting of PAN was not required for five of the seven transactions under the AIR such as investment in mutual funds, acquiring bonds or debentures and payments in respect of credit cards.
 
Since the AIR captures the investments made during 2004-05, there are several transactions which are not accompanied by PAN," an official said. The department has now instructed its field formations to identify PANs for these transactions under the AIR.
 
Until December 2005, the department had received 2,583 returns providing details of 17,31,197 transactions, valued at Rs 11,71,325 crore.
 
The highest number of transactions captured under the AIR up to December 2005 were related to RBI bonds with over 7,30,000 transaction valued at over Rs 1,61,000 crore, followed by mutual funds with over 6,11,000 transactions valued at over Rs 7,65,000 crore.
 
Cash deposits and credit card transactions are the third highest with around 4,68,000 and 3,62,000 transactions respectively.
 
The AIR was introduced in last year's Budget with the intention of collecting information on high value transactions. The information compiled through the AIR will be used to check cases of under-reporting or evasion of income tax.
 
The ministry is examining the possibility of making quotation of PAN mandatory for booking of banquet halls or going on luxury cruises.
 
Officials said more transactions could be included under the Income Tax Rule 114 B in the Budget. The rule that requires mandatory quoting of PAN at present covers 16 transactions.

 
 

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First Published: Jan 27 2006 | 12:00 AM IST

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