The
Finance Act, 2010 has introduced Sec. 206AA(w.e.f. 1/4/2010) requiring the
deductee to quote his PAN, failing which, tax at a higher rate shall be
deducted. It provides the following-
(1) Notwithstanding
anything contained in any other provisions of this Act, any person entitled to
receive any sum or amount, on which tax is deductible under Chapter XVIIB(hereafter
eferred to as deductee) shall furnish his Permanent Account Number to the
person responsible for deducting such tax(hereafter referred to as deductor), failing
which tax shall be deducted at the higher of the following rates, namely -
(i)
at the rate specified in the relevant provision of
this Act; or
(ii)
at the rate or rates in force; or
(iii)
at the rate of twenty per cent.
(2) No
declaration under sub-section (1A) or sub-section(1C) of section 197A shall be
valid unless the person furnishes his Permanent Account Number in such
declaration.
(3) In
case any declaration becomes invalid under sub-section (2), the deductor shall
deduct the tax at source in accordance with provisions of sub-section(1).
(4) No
certificate under section 197 shall be granted unless the application made
under that section contains the Permanent Account Number of the applicant.
(5) The
deductee shall furnish his Permanent Account Number to the deductor and both
shall indicate the same in all the correspondence, bills, vouchers and other
documents which are sent to each other.
(6) Where
the Permanent Account Number provided to the deductors is invalid or does not
belong to the deductee, it shall be deemed that the deductee has not furnished
his Permanent Account Number to the deductor and the provisions of
sub-section(1) shall apply accordingly
