Sub: Entering into financial Transactions -Non quoting of PAN U/S 139A(5) & 272B of the Income tax Act 1961 | Letter from Income tax for non-quoting of PAN Number

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Sub: Entering into financial Transactions – Non quoting of PAN  U/S 139A(5) & amp; 272B of the Income tax Act  1961- Reg
The letter says The income tax department is in possession of information through AIR (meaning Annual information return) that you have entered into high value financial transaction during the financial year xyz without quoting your Permanant account number . these transactions are covered under rule 114B to 114D read with section 139A(5) of the Income tax Act 1961.
Now lets understand what these section says as financial transactions…
114B.All documents pertaining to the transactions in relation to which permanent account number or General Index Register Number to be quoted for the purpose of clause (c) of sub-section (5) of section 139A.




Every person shall quote his permanent account number or General Index Register Number in all documents pertaining to the transactions specified below, namely :-


(a) Sale or purchase of any immovable property valued at five lakh rupees or more;


(b) Sale or purchase of a motor vehicle or vehicle, as defined in clause (28) of section 2 of the Motor Vehicles Act, 1988 (59 of 1988), which requires registration by a registering authority under Chapter IV of that Act :


Provided that for the purposes of this clause, the sale or purchase of a motor vehicle or vehicle does not include two wheeled vehicles, inclusive of any detachable side-car having an extra wheel, attached to the motor vehicle;


(c) A time deposit, exceeding fifty thousand rupees, with a banking company to which the Banking Regulation Act, 1949 (10 of 1949), applies (including any bank or banking institution referred to in section 51 of that Act);


(d) A deposit, exceeding ifty thousand rupees, in any account with Post Office Savings Bank;


(e) A contract of a value exceeding ten lakh rupees for sale or purchase of securities as defined in clause (h) of section 2 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956);


(f) Opening an account not being a time-deposit referred to in clause (c) with a banking company to which the Banking Regulation Act, 1949 (10 of 1949), applies (including any bank or banking institution referred to in section 51 of that Act);



(g) Making an application for installation of a telephone connection (including a cellular telephone connection); 

(h) Payment to hotels and restaurants against their bills for an amount exceeding twenty-five thousand rupees at any one time :Provided that a person shall quote General Index Register Number in the documents pertaining to transactions specified in the above clauses (a) to (h) till such time the permanent account number is allotted to him :


Provided further that where a person, making an application for opening an account referred to in clause (c) and clause (f) of this rule, is a minor and who does not have any income chargeable to income-tax, he shall quote the permanent account number or General Index Register Number of his father or mother or guardian, as the case may be, in the document pertaining to the transaction referred to in said clause (c) and clause (f) :



Provided also that any person, who has not been allotted a permanent account number or who does not have a General Index Register Number and who makes payment in cash or otherwise than by a crossed cheque drawn on a bank or through credit card issued by any bank in respect of any transaction specified in clauses (a) to (h), shall make a declaration in Form No.60 giving therein the particulars of such transaction.

Many of the public would have received such a letter from Director of Income Tax to submit their pan number with self attested copy failing which they will be liable for proceeding under income tax act 1961.
No need to worry about this letter just reply with enclosure of your pan cary self-attested copy and if you are already tax assessee mention the ward and circle where your return is filed with copy of acknowledgement which will help them to associate your AIR transaction with your income associated.
if you dont have a pan apply for PAN and enclosed acknowledgement with the letter.
Some time you many wonder why you got such letter where as I am a regular tax payee.. this may be due to non-capturing of your PAN number in your credit card while taking application which is common in case of old credit cards as now a days Pan is mandatory for issuing credit card. and you have done big transactions using your credit card which is captured in the AIR.

As shared by our viewer very important information on the AIR, treatment of the same by Income tax department given in detail…..

Dated 12th February, 2009
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
New Delhi

** ** **
All Chief Commissioners of Income-tax
Director General of Income-tax (Systems)
All Director of Income-tax (CIB)
All Commissioners of Income-tax (Computer Operations)
All Commissioners of Income-tax (in-charge of Computer Centres)
Utilization of information in the Annual Information
Returns (AIRs) relating to F.Y. 2007-08 (A.Y. 2008-
09) and subsequent years-reg.

The Board has considered the issues relating to the above and has decided that the information from the AIRs
pertaining to F.Y. 2007-08 (A.Y. 2008-09) and subsequent years should be utilized in the manner laid down in paragraphs 2 to 8 below.

2. AIR information where PAN of the transacting party is available and return is filed:

(a) The AIR data with PAN has been or shall be placed on the NCC by the DIT (Systems) and has been or shall be
used under regular cycles of CASS as per CASS instructions issued by the Directorate of Income-tax (Systems).
(b) Depending upon feedback on scrutiny assessment in a case for a particular assessment year, the Assessing
Officers may resort to proceedings u/s 148 for earlier assessment years in that case on the basis of AIR
information available, if any, if they have reasons to believe that income has escaped assessment.
(c) After issuance of notice u/s 143(2)/148, as the case may be, the Assessing Officers shall forward a
list of such cases, along with value of criterion, to their Range Addl./Joint Commissioner for the purpose of monitoring.
3. AIR information with PAN where there is no information of returns filed:
(a) To identify the non-filers, CIT(CO)/CIT (in-charge) of each RCC/CC will run the application in the AIR module to generate the list of individual cases or persons who are non-filers and shall intimate the list of non-filers to the concerned Assessing Officers in respect of these cases.

(b) Further Action thereon: After identification of the non-filers, query letters (in the format as given in
Annexure 5) shall be issued by jurisdictional Assessing Officers to all Non-Govt. transacting persons.

(i) if it is intimated by the tax payer that a return has already been filed before issue of the letter, the
jurisdictional A.O. shall immediately process the return on the system, if not processed so far, so that the
same can be considered for scrutiny selection under CASS under a fresh cycle, which would be run by the
Directorate of Income-tax (Systems).
(ii) If the letter is returned unserved, the case should be referred by the Assessing Officer to the DIT (CIB) of
his Region with full details (including PAN, RRR No. and Line No. of the AIR transaction, name/address
and TAN of the AIR filer etc.), and further action would be taken by the DIT (CIB) as indicated in
paragraph 4(f) below.
(iii) If the assessee furnishes a return in response to the letter, the case should be compulsorily assessed u/s
143(3)/144 after issue of notice u/s 142(1)/143(2), as the case may be.
(iv) If the assessee does not furnish a return in response to the letter or does not respond to the served letter,
the case should be assessed u/s 143(3)/144/147 after issue of notice u/s 142M/143(2)/148, as the case
may be.



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  1. sir, what if i have never filed for IT returns in my life ? what if i dont reply to the letter ? or is there any way out to reply this letter ,if i have never filed IT returns.

  2. If you have not filed your return and if you can prove that income what you have entered into is tax exempt no worries…. If you dont file copy of pan card notice will be issued for personal hearing to appear before assessing officer…failing which they will be liable for proceeding under income tax act 1961.

  3. sir i have never filed for it returns and i am a salarid person.In such case what reply should i give to this letter ? shall i say not eligible for tax ? and what are the consequences if i disclose my pan number to them since i have not filed for it returns ever ? what will be theit cource of action ? is there a way out – please help me ?

  4. sir, can u tell me what to look for in my form 16 , i hope u will reply as i am really scared because the fact is ive not filed it returns and conducted credit card transaction in excess of 2 lac in a year – plzz tell me what to look for in my form 16 ?

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  6. sir i got this type letter from i t department 1 month back, because in my sb account more than 90lak rs trasactions happened, why it happened is i used to collect rubbers scraps from various sources here and used to sell to my customers in south india, they used to send money through my sb account actually i am getting very less margin only as it is a rubber product so i was not aware of this problem. even i was not earned Rs 2lak out of this entire transations. what should i do now? please help me in this regard. some body was telling me that IT people have they provision to treat they entire transaction as my total income, so i may have to pay full amounts tax. I am very much worried after hearing this. so please help me by giving a answer please.?

  7. @anup Have you reported the income in your tax return? IT department willnot ask to pay you tax on turnover but only after deducting your expenses. So no need to worry . reply back to IT department with relevant documents

  8. sir, i dont have a PAN no. and i dont earn. my husband is a regular tax payer and has a PAN no. i got this letter may be because i sold a property. is it ok if i would send my husbands PAN no. or should i take a PAN card? what should i do if i dont want to take a PAN no?

  9. Sir
    I was regularly submitting my TAX RETURN FOR THE PAST 10 YEARS.I LOST MY JOB IN JAN 2010 & I WAS HUNTING FOR A JOB.Hence i have not submitted my returns during 2010-2011.i have received a letter from I.T.DEPT saying Entering into financial Transactions – Non quoting of PAN U/S 139A(5) & amp; 272B of the Income tax Act 1961- Reg
    PL HELP.

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