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Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes

PRESS RELEASE

New Delhi, 15th December, 2015

Subject: Amendment of Rules regarding quoting of PAN for specified transactions – regarding.

The Government is committed to curbing the circulation of black money and widening of tax base. To collect information of certain types of transactions from third parties in a non-intrusive manner, the Income-tax Rules require quoting of PAN where the transactions exceed a specified limit. Persons who do not hold PAN are required to fill a form and furnish any one of the specified documents to establish their identity.

One of the recommendations of the Special Investigation Team (SIT) on Black Money was that quoting of PAN should be made mandatory for all sales and purchases of goods and services where the payment exceeds Rs.1 lakh. Accepting this recommendation, the Finance Minister made an announcement to this effect in his Budget speech. The Government has since received numerous representations from various quarters regarding the burden of compliance this proposal would entail. Considering the representations, it has been decided that quoting of PAN will be required for transactions of an amount exceeding Rs.2 lakh regardless of the mode of payment To bring a balance between burden of compliance on legitimate transactions and the need to capture information relating to transactions of higher value, the Government has also enhanced the monetary limits of certain transactions which require quoting of PAN. The monetary limits have now been raised to Rs. 10 lakh from Rs. 5 lakh for sale or purchase of immovable property, to Rs.50,000 from Rs. 25,000 in the case of hotel or restaurant bills paid at any one time, and to Rs. 1 lakh from Rs. 50,000 for purchase or sale of shares of an unlisted company. In keeping with the Government’s thrust on financial inclusion, opening of a no-frills bank account such as a Jan Dhan Account will not require PAN. Other than that, the requirement of PAN applies to opening of all bank accounts including in co-operative banks.

The changes to the Rules will take effect from 1st January, 2016.

The above changes in the rules are expected to be useful in widening the tax net by non-intrusive methods. They are also expected to help in curbing black money and move towards a cashless economy.

A chart highlighting the key changes to Rule 114B of the Income-tax Act is attached.

(Shefali Shah)
Pr. CIT(OSD),
Official Spokesperson, CBDT

Sl.

NATURE OF

MANDATORY QUOTING OF PAN (RULE 114B)

TRANSACTION

Existing requirement

New requirement

Immovable property

Sale/ purchase valued at

i. Sale/ purchase exceeding Rs.10

Rs.5

lakh or more

lakh;

ii. Properties

valued

Stamp

Valuation

authority

amount

exceeding Rs.10 lakh will also

need PAN.

Motor vehicle (other than two

All sales/purchases

No change

wheeler)

Time deposit

Time deposit exceeding

Deposits with Co-op banks, Post

Rs.50,000/-

with

Office, Nidhi, NBFC companies

banking company

will also need PAN;

ii. Deposits aggregating to more

than Rs.5 lakh

during the year

will also need PAN

Deposit

with

Post

Office

Exceeding Rs.50,000/-

Discontinued

Savings Bank

Sale or purchase of securities

Contract

for

No change

sale/purchase of a value

exceeding Rs.1 lakh

Opening

account

(other

All new accounts.

i. Basic Savings Bank Deposit

than time deposit) with a

Account

excluded

(no

PAN

banking company.

requirement for

opening

these

accounts);

ii. Co-operative banks

also to

comply

Installation

telephone/

All instances

Discontinued

cellphone connections

Hotel/restaurant bill(s)

Exceeding

Rs.25,000/-

Cash

payment

exceeding

at any one time (by any

Rs.50,000/-.

mode of payment)

Cash purchase of bank drafts/

Amount

aggregating

Exceeding Rs.50,000/- on any one day

pay orders/ banker's cheques

Rs.50,000/-

during any one day

10.

Cash deposit

with banking

Cash

aggregating

Cash deposit exceeding Rs.50,000/- in a day

company

Rs.50,000/-

during any one day

11.

Foreign travel

Cash

payment

Cash payment in connection with

connection with foreign

foreign travel or purchase of

travel

amount

foreign currency of an amount

exceeding

Rs.25,000/-

exceeding Rs.50,000/- at any one

any

one

time

time (including fare, payment to

(including fare, payment

travel agent)

to travel agent, purchase

of forex)

12.

Credit card

Application

banking

No change.

company/

any

other

Co-operative banks also to comply.

company/institution

for

credit card

13.

Mutual fund units

Payment of Rs.50,000/-

Payment exceeding Rs.50,000/- for

or more for purchase

purchase.

14.

Shares of company

Payment of Rs.50,000/-

i. Opening a demat account;

or more to a company

ii. Purchase or sale of shares of an

for acquiring its shares

unlisted company for an amount

exceedingRs.1lakhper

transaction.

15.

Debentures/ bonds

Payment of Rs.50,000/-

Payment exceeding Rs.50,000/-.

or more to a company/

institution for acquiring

its debentures/ bonds

16.

RBI bonds

Payment of Rs.50,000/-

Payment exceeding Rs.50,000/-.

or more to RBI for

acquiring its bonds

17.

Life insurance premium

Payment of Rs.50,000/-

Payment exceeding Rs.50,000/- in a

or more in a year as

year.

premium to an insurer

18.

Purchase of jewellery/bullion

Payment of Rs.5 lakh or

Deleted and merged with next item

more at any one time or

in this table

against a bill

19.

Purchases or sales of goods or

No requirement

Purchase/ sale of any goods or

services

services exceeding Rs.2 lakh per

transaction.

20.

Cash

cards/

prepaid

No requirement

Cash payment aggregating to more

instruments issued

under

than Rs.50,000 in a year.

Payment & Settlement Act

CBDT-Quoting of PAN will be required for transactions of an amount exceeding Rs.2 lakh regardless of the mode of payment wef 01-01-2016 | 15-12-2015 |