What Happens to an In-Operative PAN?


The Central Board of Direct Taxes (CBDT) has issued a notice listing the consequences of an in-operative Permanent Account Number (PAN). This notice was issued on 28th March, 2023.

It may be recalled that as a result of amendments in the Income Tax Rules,1962, who fails to intimate his Aadhaar number shall face the following consequences as a result of his PAN becoming inoperative:

  1. refund of any amount of tax or part thereof, due under the provisions of the Act shall not be made to him;
  2. interest shall not be payable to him on such refund for the period, beginning with the date specified and ending with the date on which it becomes operative;
  3. where tax is deductible or collectible at source in case of such person, such tax shall be deducted or collected at higher rate;

Hence, it is of utmost importance that the PAN is with Aadhaar by 30th June, 2023.

These consequences shall take effect from 1st July, 2023 and continue till the PAN becomes operative. A fee of one thousand rupees will continue to apply to make the PAN operative by intimating the Aadhaar number.

However, the consequences of PAN becoming inoperative shall not be applicable to those persons who have been provided exemption from intimating Aadhaar number

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