Aadhaar-PAN Linking Mandatory; To Be Completed By March 31, Says CBDT

The Central Board of Direct Taxes(CBDT) yesterday issued a press release stating that "Aadhaar-PAN linking is mandatory now which has to be completed by March 31, 2019 by the PAN holders requiring filing of Income Tax Return".

This is in view of the Supreme Court upholding Section 139AA of the Income Tax Act, 1961, which required the linking of PAN with Aadhaar.   

Procedure for Aadhaar-PAN linking has been published vide notification no. 7 dated 29.6.2017 by Pr. Director General of Income Tax(Systems).

The Supreme Court bench of Justices A K Sikri and Abdul Nazeer had held on February 4 that Aadhaar-PAN linking is now mandatory. The Apex Court was hearing an appeal by Central Government against a Delhi High Court judgment of July 2018, which had permitted few petitioners to file the Income Tax Return for the Assessment Year 2018-19 without linkage of their Aadhar and PAN numbers. The High court had also directed the Income Tax Department not to insist on production of number of Aadhar enrollment for filing returns.

In the order, the Court observed: "The aforesaid order was passed by the High Court having regard to the fact that the matter was pending consideration in this Court. Thereafter, this Court has decided the matter and upheld the vires of section 139AA of the Income Tax Act. In view thereof, linkage of PAN with Aadhar is mandatory."

On September 26 2018, the Supreme Court (4:1 majority) had upheld the Aadhaar Act, though it had read down some of the provisions of the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act 2016, struck down a few but significant ones (mainly Section 33(2), 47 and 57).