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Linking Aadhaar and PAN is not mandatory for all

It has now become mandatory for everyone to link their PAN with Aadhaar with effect from July 1, 2017, as per the income tax laws. However, the government has exempted certain class of individuals from linking these two documents subject to certain conditions.


CBDT has notified that Section 139AA of the Income Tax Act is not applicable to the following individuals:

• Those categorised as Non-resident Indians as per the Income Tax Laws.
• Not a citizen of India.
• Is of age 80 years or more at any time during the tax year.
• Residents of the states of Assam, Meghalaya and Jammu and Kashmir.

However, it should be noted here that the above mentioned categories of Individuals are exempted from the purview of section 139AA i.e. exempted from compulsory linking of PAN and Aadhaar, only if they do not possess Aadhaar or Aadhaar Enrolment ID.

What is section 139AA is about?
The newly introduced section 139AA of the Income Tax Act states that every person who has been allotted PAN as on July 1, 2017 and who is eligible to obtain Aadhaar Number shall intimate the same to the tax authorities. The PAN of those who fail to do so will become invalid on a date to be notified later by the department.

Background:
The Aadhaar (Target Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016 states that every resident shall be entitled to obtain Aadhaar number by submitting his demographic and biometric information by undergoing the process of enrolment. The Act has also defined the eligibility conditions for Aadhaar.