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On the deadline for linking PAN with Aadhaar being extended in India

The Central Board of Direct Taxes (CBDT) in India has extended the deadline for linking the Permanent Account Number (PAN) with the country’s biometric identification project number Aadhaar, till the 31st of March 2019. The announcement came hours before the deadline last night. A copy of the notification below. A few points to note:

1. Not the first extension: This is not the first time that a government department has mandated linking of Aadhaar, only to push the deadline at the last minute. Previous deadlines include, in reverse chronological order:

  • 31st March 2019
  • 31st March 2018
  • 31st December 2017
  • 31st August 2017
  • 1st July 2017

The linkage is made legal through the passing of Section 139AA of Income Tax Act., 1961, which was upheld by the Supreme Court of India.

2. 45% have still not linked: It was reported by PTI in February that only 230 million PAN cards had been linked to Aadhaar, out of a total of around 420 million. That means that around 45% of PAN card holders hadn’t yet linked their Aadhaar to PAN. The CBDT Chairman had said then that they could cancel PAN numbers if they hadn’t been linked to Aadhaar.

3. Procedural issues: The Hindu reported last month that people are unable to link PAN with Aadhaar because of a name mismatch issue. PAN doesn’t allow initials, while Aadhaar does, and the two thus may have different names in each database. The software is unable to resolve the issue of different names, and this problem particularly affects those in the southern states in India, where names in some cases are long and hence abbreviated. Thus changes have to be made in either PAN or Aadhaar in order to reconcile the two.

MediaNama’s take

1. Procedural issues indicate incompetence: The fact that even almost two years after mandating linkage of Aadhaar with PAN indicates incompetence in governance from multiple perspectives:

  • Firstly, the fact that linkage was mandated without sufficient study into the feasibility of linking PAN with Aadhaar suggests that this was an adhoc decision affecting millions of taxpayers.
  • Secondly, the fact that deadlines are being given without software being addressed over almost two years indicates incompetence from the CBDT. Citizens cannot be to blame for software issues between the two government departments.

2. Threats to cancel are problematic: Why is the Income Tax department in such a rush to link PAN with Aadhaar, especially when such a large base of taxpayers hasn’t yet linked? What’s the rationale behind each deadline and each extension? The fact that deadlines are being issued and then extended last minute repeatedly, indicates that the objective is to create panic and force people into linking PAN with Aadhaar. This is not how governance should be done, especially when as many as 45% of the population hasn’t linked PAN to Aadhaar. Beyond a point, these threats will not be taken seriously. If the CBDT were to cancel PAN, they would impact tax collections significantly, and not collect direct taxes from as many as 45% of the taxpaying base.

CBDT Notification

Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes

New Delhi, 31stMarch, 2019


CBDT issues clarification onlinking of PAN with AadhaarIt has been reported in some sections of themedia that those PANs which are not linked with Aadhaar number by 31.03.2019 may be invalidated. The matter has been considered by the Central Government and now the cut-off date for intimating the Aadhaar number and linking PAN with Aadhaar is 30.09.2019, unless specifically exempted.

Notwithstanding the last date of intimating/linking of Aadhaar Number with PAN being 30.09.2019, it is also made clear that w.e.f. 01.04.2019, it is mandatory to quote and link Aadhaar number while filing the return of income, unless specifically exempted.

(Surabhi Ahluwalia)
Commissioner of Income Tax
(Media & Technical Policy)
Official Spokesperson, CBDT

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