Tighter norms for duplicate PANs soon

Abetting issuance or use of more than one permanent account number may attract fines.

Abetting issuance or use of more than one permanent account number (PAN) may soon attract penal provisions.

The finance ministry is considering an amendment to tighten penal provisions against use of duplicate PAN cards. It is also considering introduction of biometric or smart PAN cards to prevent duplication.

Finance Minister P Chidambaram, who recently reviewed the functioning of the PAN system, has asked the income tax department to ensure that all duplicate PANs were identified and removed from the system by December 2006.

At present, penal provisions are restricted to issuance and use of duplicate PAN. But abetting the issuance of or use of duplicate PANs does not attract any penal provision at present.

The department, which has so far identified 26 lakh PANs for around 13 lakh people, will soon come out with a media campaign, asking people to voluntarily surrender their duplicate numbers to the department.

While Delhi has 6 lakh duplicate PANs, Mumbai has around 3.3 lakh and Kolkata has over two lakh.

The need to tighten norms for issuance of PAN is being felt in the wake of the large number of PAN applications. In the last 11 weeks, the department has received 18 lakh applications for PANs. The department has so far issued 4.6 crore permanent account numbers.

The department has already asked PAN service centres operated by the National Securities Depository Ltd and the UTI Securities to undertake 100 per cent re-verification at their digitisation centres.

They have also been asked not to accept PAN applications without the full names of the applicants. Earlier, applicants were allowed to use initials while filling the forms.

The department is also considering removing some of the validation documents allowed to be used as proof of identity and address, such as water bill and rent receipt.

It is also mulling introduction of "scoring", which means that weightage will be assigned to various documents being allowed as proof of identity and address.

For instance, submission of the Class X board exam marksheet for proof of age will be assigned higher weightage than a letter containing the signature of a gazetted officer or an MLA. The latter with a low weightage will require more verification.