SBI, HDFC Customers: Follow this Rule by June-end or Banking Services to be Hit

The Permanent Account Number (PAN) must be linked to Aadhaar card by the end of this month. The PAN cards which are not linked to Aadhaar would become useless and declared “inoperative” after June 30. “If a person fails to intimate the Aadhaar number, the permanent account number allotted to such person shall be made inoperative after the notified date in the manner as may be provided by rules,” according to Clause 41 of Section 139AA of the Income Tax Act.

Issued by the Income Tax department, Permanent Account Number (PAN) is a ten-digit unique alphanumeric number. PAN helps the tax officials to prevent tax evasion and frauds as  it is linked to all financial transactions made by an individuals. To avoid any inconvenience from next month, banks have started asking customers to link their PAN and Aadhaar details by the end of this month. “We advise our customers to link their PAN with Aadhaar to avoid any inconvenience and continue enjoying a seamless banking service,” State Bank of India (SBI) mentioned on Twitter.

“If not linked, PAN will be rendered inoperative or inactive and cannot be quoted for conducting specified transactions,” SBI mentioned. PAN card is must while opening a bank account, applying for a credit and debit card, starting a demat account among other things. If an individual deposits cash of over ₹50,000 in a day in a bank, PAN is mandatory. Providing PAN details is a must while buying mutual funds, debentures, bonds, etc worth more than ₹50,000. A customer needs to provide PAN details while making a payment of over ₹50,000 in cash during any one day for purchase of bank drafts or pay orders or banker’s cheques from a banking company or a co-operative bank. Apart from these, several other banking services will be affected if PAN card becomes inactive.

SBI has urged the users to go to Income Tax e-filing portal and link PAN and Aadhaar to enjoy “seamless banking services”. HDFC Bank has also been informing their customers about PAN Aadhaar linking deadline via SMS.

In Budget 2021, the Union government has added a new section 234H in the Income Tax Act, where an individual will have to pay a penalty if PAN and Aadhaar are not linked after the deadline ends. So if an individual misses the deadline, he or she will be liable to pay a penalty not exceeding more than Rs 1,000.

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