Understanding Permanent Account Number (PAN) Cards: Importance, Types, and Application Process

The Permanent Account Number (PAN) card serves as an essential identification document issued by the Indian Income Tax Department to all taxpayers. This 10-digit alphanumeric code systematically records all tax-related information for individuals and various entities. Functioning as a primary identifier for financial transactions, a PAN card is indispensable for banking, tax filings, and business registrations. Understanding the different categories of PAN cards available and the specific eligibility criteria for application is crucial for anyone involved in financial activities across India.

Understanding the Permanent Account Number (PAN)

Below is an overview of key aspects related to the Permanent Account Number (PAN) card:

What is a PAN Card?

The Income Tax Department issues a PAN card, which includes a distinct 10-digit Permanent Account Number (PAN). This PAN functions as a proof of identity for individuals or entities across various applications. All tax-related data for a person is centrally maintained against their specific PAN.

While PAN is the unique 10-digit alphanumeric code, the PAN card is the physical or digital document containing this number and other vital personal information. Since January 1, 2017, all new PAN cards incorporate a Quick Response (QR) code, facilitating data verification. The card also displays the cardholder's name, father's name, date of birth, and signature.

PAN Card Details

A PAN card displays several pieces of information:

• Cardholder's Name: This includes the name of the individual, partnership firm, LLP, or company.
• Father's Name: This is relevant only for individual cardholders. The name of the father or, in the case of a single parent, the mother, is printed.
• Date of Birth: For individuals, this is their date of birth; for companies or firms, it is their registration date.
• PAN Number: The unique 10-digit alphanumeric identifier, where each character conveys specific information about the cardholder.
• Signature: Required solely for individual cardholders, the PAN card acts as verification of their signature for financial dealings.
• Photograph: An individual's photograph is present, serving as photo identity proof. Companies and firms do not feature a photograph on their cards.

Structure of the Permanent Account Number (PAN)

The 10-digit alphanumeric PAN is systematically structured, with each character providing specific insights into the cardholder:

• First Three Characters: These are always alphabetical, consisting of three letters from A to Z.
• Fourth Character: This alphabet denotes the taxpayer's category. Examples include:
  • A – Association of Persons
  • B – Body of Individuals
  • C – Company
  • F – Firms
  • G – Government
  • H – Hindu Undivided Family
  • L – Local Authority
  • J – Artificial Judicial Person
  • P – Individual
  • T – Association of Persons for a Trust
• Fifth Character: This is the initial letter of the individual's surname.
• Next Four Characters: These are strictly numerical in nature, ranging from 0 to 9.
• Last Character: The final character is an alphabet.

Categories of PAN Cards

Different types of PAN cards are issued to various tax-paying entities in India:

• Individuals (including minors and students)
• Hindu Undivided Family (HUF)
• Companies
• Partnership Firms
• Limited Liability Partnerships (LLP)
• Trusts
• Societies
• Association of Persons (AOP)
• Body of Individuals (BOI)
• Foreign Citizens

PAN Card Application Forms

There are three primary forms for PAN card applications:

• Form 49A: This form is for Indian citizens, including minors, Non-Resident Indians (NRIs), citizens residing abroad, Indian companies, firms, and BOI/AOPs who do not possess a PAN card.
• Form 49AA: This form is exclusively for foreign citizens who need to obtain a PAN.
• Changes or Corrections in Existing PAN / Reprint of PAN Card: This form is used by individuals who already have a PAN but need to modify or correct details on their PAN card. It is also used for reprinting an existing PAN card without any changes.

PAN Card Eligibility Requirements

Both Indian citizens and Non-Resident Indians (NRIs) are eligible to apply for a PAN card.

Eligibility for Indian Citizens

• Individuals: All Indian citizens, whether salaried, self-employed, or professionals, can apply with valid identity and address proofs.
• Minors: Parents or legal guardians can apply on behalf of minors and students. The guardians must provide their own documents along with the minor's date of birth proof.
• Hindu Undivided Families (HUFs): A HUF, being a distinct legal entity, can apply for a PAN card through its Karta to conduct financial transactions.
• Limited Liability Partnerships (LLPs): LLPs are required to obtain a PAN card for financial dealings and tax compliance.
• Partnership Firms: Partnership firms must secure a PAN card in their name for income tax return filings.
• Companies: All companies operating in India must possess a PAN card and use its number in all financial transactions.
• Trusts and Associations: Trusts, Association of Persons (AOP), and Body of Individuals (BOI) can apply by submitting their Certificate of Registration.
• Local Authorities: Local authorities can apply for a PAN card by providing a copy of their agreement.
• Artificial Judicial Persons: Any other artificial judicial person can obtain a PAN card by presenting a Certificate of Registration or a government document verifying their identity and address.

Eligibility for Foreign Citizens

Foreign citizens engaged in financial transactions within India must apply for a PAN card, providing identity, address, and date of birth documents.

How to Apply for a PAN Card

A PAN card application can be submitted either online or offline.

Online Application via NSDL

• Access the official NSDL portal.
• Choose the application type and category, enter the necessary information, and click 'Submit'.
• A token number will be displayed and sent to your email. Proceed by clicking 'Continue with PAN Application Form'.
• Select your preferred mode for document submission and indicate if a physical PAN card is required. Complete the form and upload all mandated documents.
• Pay the processing fee and save a copy of the acknowledgment number.
• If you opted for physical document submission, send the documents and the completed application to the Income Tax PAN Services Unit of Protean eGov Technologies Limited.

The PAN card is typically dispatched within 15-20 days of submitting the online application or receiving the physical documents.

Online Application via UTIITSL

• Navigate to the UTIITSL website.
• Click the 'Click to Apply' option under 'PAN Card for Indian citizen/ NRI' or 'PAN Card for foreign citizen'.
• Select the 'Apply for New PAN Card' tab.
• Choose the document submission mode, applicant status, and PAN card mode, then click 'Submit'.
• You will receive a reference number. Click 'OK'.
• Provide personal details, document details, contact and parent information, address, and other relevant data, then click 'Next Step'.
• Upload all required documents and click 'Submit'.
• Review the details on the form and click on the 'Make Payment' button to complete the transaction.
• After successful payment, print out the form. If you selected physical document submission, send the form and documents to UTIITSL's PAN PDC Incharge offices in Mumbai, Kolkata, Chennai, or New Delhi.

Once the application is submitted online or received by the UTIITSL office, the PAN card is processed and dispatched within 15 days.

Offline Application Process

• Obtain the PAN card application form from PAN centres. Alternatively, you can download 'Form 49A for Indian citizens' or 'Form 49AA for foreign citizens' and print them.
• Fill in the required details, attach a recent color photograph, and provide your signature.
• Attach all necessary documents to the application.
• Visit the nearest PAN centre, submit the form with all documents, and pay the applicable fees.

Required Documents for PAN Card Application

The documents needed for a PAN application vary based on the applicant type:

PAN Card Application Fees

The fees for applying for a PAN card vary based on the application and dispatch methods:

Checking PAN Card Status

After submitting your PAN card application, you can track its status by following these steps:

• Enter the acknowledgment number or application number and the captcha code, then click 'Submit'.
• The current status of your PAN card application will be displayed.

How to Download Your PAN Card

Once your PAN card is processed, you can download its digital version, known as an e-PAN card, using the following procedure:

• Visit the NSDL or UTIITSL website.
• Input the necessary details, such as acknowledgment number or PAN, date of birth, etc.
• Enter the OTP, pay any applicable fees (for downloads after 30 days of allotment), and click 'Download e-PAN'.

Updating or Correcting PAN Card Details

To update or correct information on your PAN card, follow this process:

• Go to the NSDL portal or UTIITSL website.
• Select the application type as "Changes or Corrections in existing PAN/ Reprint of PAN card".
• Enter the details requiring modification, upload the supporting documents, and click "Submit".
• Pay the processing fee.
• The updated PAN card will be dispatched within 15 days.

Guidelines for Completing the PAN Form

Adhering to specific guidelines when filling out the PAN form can prevent rejections:

• Ensure all entered information is current and accurate.
• Provide a complete and full address for timely PAN card delivery.
• Avoid using abbreviations for the First Name and Last Name sections. If an abbreviation is part of your name, write out the full form.
• Applicants other than individuals (e.g., companies, firms) should not fill in sections related to gender, parents' details, or residence address.
• Individuals whose income is not from salary, business, or profession are not required to fill in the office address.
• Individuals should leave the registration number section blank.
• Self-attest supporting documents with your signature or thumb impression.
• Inaccurate information or missing support documents will result in the application being rejected.

Applying for a Duplicate PAN Card

If your PAN card is lost, you can apply for a duplicate online. The procedure is as follows:

• Visit the NSDL or UTIITSL website.
• Enter required details such as your PAN, Aadhaar number, date of birth, GSTIN (if applicable), and captcha code, then submit.
• Input the OTP, pay the necessary fees, and submit.
• The reprinted PAN card will be mailed to your registered address.

Why a PAN Card is Essential

A PAN card is crucial for various identity and financial activities in India. This unique identification number serves multiple purposes for every tax-paying individual and entity:

• Acts as Proof of Identity.
• Serves as Proof of Address.
• Mandatory for filing income taxes.
• Required for business registration.
• Essential for opening and operating bank accounts.
• Needed for obtaining phone and gas connections.
• Beneficial for completing e-KYC (Know Your Customer) processes for mutual fund investments.
• Mandatory for single bank deposits exceeding Rs. 50,000.
• Compulsory for purchasing property and vehicles (excluding two-wheelers).
• Required for all bank transactions above Rs. 10,000.

PAN for e-KYC (Know Your Customer)

Linking your PAN to Aadhaar is a mandatory step for e-KYC and verification, which allows individuals to access services and benefits from various providers. PAN-based e-KYC offers significant advantages to both end-users and the government:

• The e-KYC process is entirely paperless, streamlining document management for service providers.
• PAN cardholders can securely share information with service providers within minutes, eliminating the extended waiting periods associated with physical documents.
• Information exchanged via e-KYC utilizes tamper-proof digital documents transmitted through secure channels, thereby safeguarding the holder's data. These documents cannot be counterfeited or used without the explicit consent of both the service provider and the PAN cardholder.
• E-KYC ensures that shared information is authenticated and legally acceptable for all parties involved in a transaction.
• The system is entirely paperless and online, which removes the need for physical document movement, making it a cost-effective and time-efficient process.

A PAN card is an indispensable document for every taxpayer and individual engaged in financial transactions within India. Regardless of whether you are an individual, a company, or a trust, specific PAN card categories cater to your entity type. The process of obtaining a PAN card, either online or offline, has been simplified, enabling easy access to a broad spectrum of banking and investment services.