Indian citizens over 18 years of age are issued with PAN (permanent account number) by the income tax department to keep track of their valid source of income. The IT department can keep a track of the flow of funds for tax and related activities through it. It is, however, illegal to hold more than one PAN.
The 10-digit alphanumeric number is issued under section 139A of the IT Act and has a unique combination for every individual. But, some of the tax-payers can have multiple PAN cards created intentionally on unintentionally. It could happen unintentionally if you have applied for a PAN card multiple times. In case of intentional motives, some individuals get a new PAN to evade tax or to renew their identity from a previously bad credit outlook.
Consequences of having more than one PAN
As mentioned before, holding more than one PAN is a fraudulent offense. Once the bank of the financial institution you are a customer of detects it, they will hand over the issue to the regulators.
- A penalty of Rs 10,000 or higher will be imposed depending on the intention of the multiple PANs under section 272B of the Income Tax Act of 1961.
- In case of tax evasion, tax fraud or money laundering, the PAN holder can also be prosecuted.
- Your chances of getting a secured or unsecured credit are equal to none despite good credit score when your financial institution or bank finds out about the multiple identities. The institutions blacklist the entities or individuals and report them to the regulatory authorities. Following the rejection, you will be faced with an investigation from the IT department.
How to report the multiple PAN issue to the IT department?
If you have more than one PAN and you need it fixed, you can go to NSDL's website (National Securities Depository Limited) and choose the "change or correct existing PAN data" option and follow the instructions.
If you wish to go the offline way, you can download the form from the NSDL website and submit it to your nearest UTI or NSDL PAN card office. It should take about 8 to 10 days for the deletion of duplicate records.