The Finance Act, 2017 had inserted a new Section 139AA in the Income-tax Act, 1961, requiring every person who is eligible to obtain Aadhaar to quote his Aadhaar number while applying for PAN or furnishing return of income with effect from July 1, 2017. If any person does not possess the Aadhaar Number but he had applied for the Aadhaar card then he can quote Enrolment ID of Aadhaar application Form in the ITR.

Section 139AA further provides that every person who has been allotted PAN as on the 1st day of July, 2017, and who is eligible to obtain Aadhaar number shall intimate his Aadhaar number on or before a date to be notified 31-03-2022 to the Income-tax Department. In case of failure to intimate the Aadhaar number, PAN allotted to the person shall be made inoperative after the date so notified.

The CBDT has notified(1) that all the consequences provided under the Income-tax Act for not furnishing, intimating or quoting PAN shall come into effect from 01-04-2023 if PAN becomes inoperative due to non-linking of it with Aadhaar. However, the taxpayer is liable to pay fee under Section 234H if PAN is linked with Aadhaar from 01-04-2022 to 31-03-2023.

(1) Circular No. 07/2022, dated 30-03-2022 read with Proviso to Rule 114AAA(2) inserted by the Income-tax (Third Amendment) Rules, 2022 vide Notification No.17/2022 dated 29-03-2022.

Source: Income Tax India’s Official Website