In the Union Budget 2019, presented by Finance Minister Nirmala Sitharaman on 5 July, it was proposed to allow the use of Aadhaar to file income tax returns in cases where the tax filer does not have a PAN. The change, in a way eliminates the need to have a PAN (permanent account number) for tax purposes.
However, in an interview with PTI, Pramod Chandra Mody, chairman of the Central Board of Direct Taxes (CBDT), said that the PAN is "certainly not dead" and using the Aadhaar interchangeably with PAN for ITR is only an "additional facility" to ensure that these are linked. (Linking one's Aadhaar with PAN is compulsory as per the law.)
Mody further told PTI, "In cases where Aadhaar is being quoted and PAN is not there, we could possibly think on the terms of allotting a PAN to the person (who is filing income tax return)."
The assessing officer of the department will use his powers to allot PAN to an entity, he said. "The law provides that the assessing officer can suo motu also allot PAN. So, if Aadhaar is being quoted without PAN, I give him the PAN. It becomes linked," the CBDT chairman said.
'Suo motu' is a Latin word that means 'on its own motion'.
Under Section 139 of the I-T Act, an assessing officer of a department has the power to suo motu issue a PAN to anyone whom they deem appropriate should have the ID, from the point of view of their financial transactions profile.