PC seeks to issue PAN suo-motu
In the Budget FM said scrutiny of AIR on high-value transactions revealed that 60% of the transactions are without quoting PAN.india Updated: Feb 28, 2006 19:14 IST
Aiming to curb unaccounted transactions that cost the exchequer a lot, the government announced a series of measures including issuance of Permanent Account Number suo-motu and make the norms for 'anonymous donation' stringent.
The idea of suo-motu issuance of PAN came from tracking of high value transactions over Rs 1,500 crore at a bank branch in Delhi without paying sales and income tax that were unearthed through scrutiny under Banking Cash Transaction Tax.
In his Budget for 2006-07 tabled on Tuesday in Parliament, Finance Minister said scrutiny of Annual Information Report (AIR) on high-value transactions revealed that 60 per cent of the transactions are without quoting Permanent Account Number.
He proposed to issue PAN suo-motu in certain cases and and direct persons to apply for PAN in certain cases.
He said in due course quoting PAN will be mandatory in more transactions while prescribing a few more transactions to be reported under AIRs. The above changes in issuing PAN will become effective from June 1.
Likewise, to tax unaccounted money contributed to some charitable or religious institutions by anonymous donations, Chidambaram proposed to add such donations into total income of such institutions and tax at the rate of 30 per cent.
However, the anonymous donations received by any trust or institution created or established wholly for religious purposes will be exempted. These amendments will be effective from April 1, 2007.
Government also stated to withdraw certain deductions given under the Income Tax Act to entities like those are in special economic zones if they do not file returns within specifed time limit.