Wednesday, 24 June 2015

Conventional and Unconventional Uses Of Pan Card

Tracking and identifying all your financial activities, i.e. the monetary investments, bank transactions, etc. is the prime use of a PAN card or Permanent Account Number card. Initially the PAN cards were allotted to the taxpayers and were a means to identify their banking habits and file an ITR (Income Tax Return).
Later, even dealing in stocks became impossible without having a PAN card. Then, sale or purchase of immovable properties or vehicles became difficult without submitting a copy of PAN cards. Thus, gradually the PAN card has found its importance in several unceremonious processes. You may require your PAN card in various places where you may think you may not need it.
uses of pan card

Some of the unorthodox areas where the PAN cards have established their importance are:


Opening a Fixed Deposit is one of the most conventional means of saving your money. If you wish to open a Fixed Deposit or FD account, you might need a PAN card, as every FD account which exceeds Rs. 50,000 can be opened only on obtaining a copy of your PAN.

Also, if the PAN card is not provided, the bank is entitled to deduct a 20% as TDS and will not be issuing any certificate for the same. Thus, making the 15G/15H certificates invalid in the this particular scenario.


If your hotel bills exceed Rs. 25,000, there are very healthy chances that you will be prompted to submit a copy of your PAN card. Thus, do carry one if you visit a hotel.


The landlords are quite strict at obtaining a rent agreement and the usual proof that is asked for, is a copy of your PAN card accompanied by any other identity proof.


If you wish to travel abroad and have paid an amount of Rs. 25,000 in cash, the travel agent might ask you to show a copy of your PAN card.

Other Uses:

Whether you are applying for a new telephone connection or are buying/selling a used vehicle, etc. you will be prompted to submit the copies of your PAN card or at least quote the PAN.

Thus, PAN is really crucial for carrying out every major financial transaction in India or abroad.

Why Do an NRI Need a PAN Card?

If an NRI is known to have an income in India, then he/she is supposed to have a valid Indian PAN card. This PAN card can then be used for carrying out various financial transactions, including, buying of land/home, for carrying out any other form of investment in India, etc.

Increasing PAN Frauds

The number of reported PAN card frauds is increasing rapidly and over the past few years these frauds have almost doubled in number. The safety of the PAN card doesn’t guarantee that the card won’t be misused or will not be used for fraudulent transactions. As, in most situations only the PAN or the copy of your PAN card will do the business, it thus becomes easier for anyone to forge a copy of your PAN card, just by knowing the Permanent Account Number.

Thus, it is quite important that you keep your PAN confidential and do not reveal it, unless needed.

If Your PAN card is Misused?

If you have become the victim of PAN card fraud, you can get hold of all the benami transactions carried on your PAN. This can be done by submitting the FORM 26AS. In order to evade the illegal transaction carried out using your PAN, you will have to prove it to the Income Tax Department that the transactions were not carried out by you and will have to disclose all the details your income and related transactions. This is a really hectic process and can take a lot of time to resolve.

The person who holds a PAN card, but doesn’t pay the taxes, won’t be able to check the FORM 26AS.

The above frauds can be minimised by only using your cross signed PAN card copies and avoiding the use of PAN card at every casual transaction.

What is PPAN or Phonetic PAN?

The PPAN or Phonetic PAN is a new technique which efficiently prevents the allotment of a single PAN to more than one assessee consisting similar or same names. During the allotment of PAN, PPAN of the concerned assessee is kept different from all the existing PAN holders.

The PPAN system shows off a warning message if on comparison, the PPAN of the new PAN card is found to be similar to an existing PPAN. Only when this PPAN detection overrides, is when the new PAN is allotted.

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