F.No. 275/4/2024-IT(B)
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
Circular No.6 12024
New Delhi, th~~ ril , 2024
Sub: Partial modification of Circular No.3 of 2023 dated 28.03.2023 regarding
consequences of PAN becoming inoperative as per rule 114AAA of the Income-
tax Rules, 1962- reg.
Circular No. 3 of 2023 dated 28.03.2023 issued by the Board details the
consequences of PAN becoming inoperative as under:
"Consequent to the notification substituting rule 114 AAA of the Income-tax
Rules, 1962 (the Rules) vide notification no. 15 of 2023 dated 28th March, 2023,
it is hereby clarified that a person who has failed to intimate the Aadhaar number
in accordance with section 139AAA of the Income-tax Act, 1961 (the Act) read
with rule 114AAA shall face the following consequences as a result of his PAN
becoming inoperative:
(i)
refund of any amount of tax or part thereof, due under the
provisions of the Act shall not be made to him;
(ii)
interest shall not be payable to him on such refund for the period,
beginning with the date specified under sub-rule (4) of rule 114AAA and
ending with the date on which it becomes operative;
(iii)
where tax is deductible under Chapter XVI/-8 in case of such
person, such tax shall be deducted at higher rate, in accordance with the
provisions of section 206AA;
(iv)
where tax is collectible at source under Chapter XVI/-88 in case
of such person, such tax shall be collected at higher rate, in accordance
with the provisions of section 206CC. "
2.
As per sub-rule (4) of rule 114AAA of the Income-tax Rules, 1962, the above
consequences shall have effect from the date specified by the Board. The Board vide
Circular No. 03 of 2023 dated 28th March, 2023 had specified that the consequences
shall take effect from 1st July, 2023 and continue till the PAN becomes operative.
3.
Several grievances have been received from the taxpayers that they are in
receipt of notices intimating that they have committed default of 'short-
deduction/collection' of TDSITCS while carrying out the transactions where the PANs
of
the
deductees/collectees
were
inoperative.
In
such
cases,
as
the
deduction/collection has not been made at a higher rate, demands have been raised
by the Department against the deductors/collectors while processing of TDSITCS
statements under section 200A or under section 206CB of the Act, as the case
maybe.
4.
With a view to redressing the grievances faced by such deductors/collectors,
the Board, in partial modification and in continuation of the Circular NO. 3 of 2023,
hereby specifies that for the transactions entered into upto 31 .03.2024 and in cases
where the PAN becomes operative (as a result of linkage with Aadhaar) on or before
31 .05.2024, there shall be no liability on the deductor/collector to deduct/collect the
tax under section 206AN206CC, as the case maybe, and the deduction/collection as
mandated in other provisions of Chapter XVII-B or Chapter XVII-BB of the Act, shall
be applicable.
5.
Hindi version to follow.
c~~
;2-~)()y
(Sunil Kumar)
Under Secretary to the Government of India
Tele: 23095478
Copy to:-
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PS to FM/OSD to FM/PS to MoS (R)/OSD to MoS(R)
PPS to Secretary (Revenue)
The Chairman, CBDT & all Members, CBDT
All Pr.CCsIT, CCsIT/Pr.DGIT/DGsIT
All Joint Secretaries/CslT, CBDT
Pro Commissioner of Income-tax (Media & TP) and official Spokesperson,
CBDT, New Delhi
CIT, (CPC-TDS)
ADG (PR,P&P) for necessary action
JCIT, Database Cell, with a request to upload the order on the website
www.irsofficersonline.gov.in
Web Manager, %
DGIT(Systems) with a request to upload the order on the
website of www.incometaxindia.gov.in
The Institute of Chartered Accountants of India, IP Estate, New Delhi
All Chambers of Commerce
The Guard File
~~~
(Sunil Kumar)
Under Secretary to the Government of India
Tele: 23095478
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