No panelty for quoting Wrong PAN No. in ITR ? is it right ?

This query is : Resolved

PRAVEEN KUMAR (Querist)
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03 September 2009 I found the following Question on Taxworry.com, I am always curious to know if i filed my returns with wrong pan no. is there any panelty etc.

As per given below answer there is no panelty. i would like to ask experts in this caclub to confirm is it right that there is no panelty on wrong PAN in return.

Please let me know your views.

here is the article (quenstion / answer)

No Penalty For Wrong PAN in The Return!

Question Asked by Someone
I am a salaried person. At the time of filing Return I noticed that the PAN number, what I had given to Employer at the time of deduction, is not mine(2 digits are in either sequence). What will be the solution? Do I have to face some penalty for illegal action? Is there any way to get my return? Vikash Kumar , Banglore

Contrary to general belief , in my opinion, there is no provision for imposing penalty for quoting wrong PAN in the Return of Income.The reasons for such an opinion is as under:

Section 139A is regarding Permanent Account Number . Sub-section (5) of section 139A of the I T Act makes it mandatory to quote PAN in return and at other times. The said provision is as under :

(5) Every person shall

(a) quote such number in all his returns to, or correspondence with, any income-tax authority;

(b) quote such number in all challans for the payment of any sum due under this Act;

(c) quote such number in all documents pertaining to such transactions as may be prescribed by the Board in the interests of the revenue, and entered into by him:

Provided that the Board may prescribe different dates for different transactions or class of transactions or for different class of persons:

Provided further that a person shall quote General Index Register Number till such time Permanent Account Number is allotted to such person;

(d) intimate the Assessing Officer any change in his address or in the name and nature of his business on the basis of which the permanent account number was allotted to him.

Mark the clause ( a) which makes quotation of PAN mandatory in all "his returns"

Clause C makes it mandatory for a person having prescribed transaction like fixed deposits, mutual fund investment, car purchase,property purchase etc.

Let us now visit section 272 B of the I T Act which prescribes penalty for contravening section 139A. The said penalty provision is as under :

272B. (1) If a person fails to comply with the provisions of section 139A, the Assessing Officer may direct that such person shall pay, by way of penalty, a sum of ten thousand rupees.

(2) If a person who is required to quote his permanent account number in any document referred to in clause (c) of sub-section (5) of section 139A, or to intimate such number as required by sub-section (5A) or sub-section (5C) of that section, quotes or intimates a number which is false, and which he either knows or believes to be false or does not believe to be true, the Assessing Officer may direct that such person shall pay, by way of penalty, a sum of ten thousand rupees.

(3) No order under sub-section (1) or sub-section (2) shall be passed unless the person, on whom the penalty is proposed to be imposed, is given an opportunity of being heard in the matter.

The aforesaid penalty provision describes two types of contravention of section 139A for which penalty u/s 272B can be levied

i) For failing to comply with provision of section 139A.

ii) For wrong quotation of PAN in case of

Clause C of section 139A(5)
Section 139A(5A)
Section 139A(5C)
So what is clear from aforesaid provision that quoting wrong PAN in the return is not a contravention for which penalty u/s 272B of the I T Act is prescribed. Had there been no distinction, law makers would have mention Clause A and Clause B of section 139A(5) also and not only Clause C .The deliberate omission of Clause A and B of section 139A (5) has a meaning .

Therefore, if you do not mention PAN in the Return , it is equal to not comply with section 139A and therefore penalty is imposable as per subsection 1 of section 272B , but not if there is an error in PAN mentioned in return.

Your case

Filling out PAN in the Return of income is mandatory as per section 139A(5). Section 272B of the I T Act prescribes that in case a person fails to comply with section 139A may be asked to pay a penalty of Rs 10,000 . You have filled the PAN , but the PAN is wrong . In this case , penalty is not imposable for reasons mentioned above.

However,you should immediately intimate the A.O in writing that your PAN is wrongly given in the return ands that the correct PAN is as per the letter.

Section 272B(3) provides that penalty can not be imposed unless an opportunity is given to person on whom penalty is proposed to be imposed.In case the A.O initiates penalty proceedings u/s 272B , give reason

1. Wrong quotation was inadvertent.

2. There is no provision under section 272B for imposing penalty for wrong quotation of PAN in Return of Income.

CA CS CIMA Prakash Somani

CA CS CIMA Prakash Somani (Expert)
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03 September 2009 I fill there should not be any penalty for quoting wrong PAN but there may be interest and penalty for not filing his return with correct PAN within the stipulated period of time.

PRAVEEN KUMAR

PRAVEEN KUMAR (Querist)
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03 September 2009 Dear Mr. Somani,

It means you are also agree with this point that if you quote wrong pan no. there is no panelty etc.

Pls confirm again. if i am wrong pls reply

Thanks.

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CA CHINTAN AJMERA

CA CHINTAN AJMERA (Expert)
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03 September 2009 If you quoted wrong pan in return of income then penalty may be levied, and your employer deducted TDS in othe PAN NO. that means you have no tax credit in your account and you have to pay the tax and interest on your income.

PRAVEEN KUMAR

PRAVEEN KUMAR (Querist)
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03 September 2009 Dear Mr. Ajmera,
As you say i am agree that if we quote wrong pan no. in itr & employer etc. who ever give my pan no. in deduction of tds will not match. i am agree that the person will not get any tax credit.

But my query is if a person give wrong PAN No. in filing return, how and how much he can be panelised ?. as per law. if he can be save from all panelties how ?

Thanks
Praveen

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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04 August 2024 ### Clarification on Penalty for Quoting Wrong PAN in ITR

Here's a detailed breakdown of the situation regarding the quoting of a wrong Permanent Account Number (PAN) in your Income Tax Return (ITR) and the associated penalties:

#### **1. Legal Framework**

**Section 139A of the Income Tax Act:**
- **Section 139A(5)** requires every person to quote their PAN in their return, correspondence, and documents pertaining to prescribed transactions.
- **Section 272B** deals with penalties for failure to comply with Section 139A.

**Penalty Provisions under Section 272B:**
- **Subsection (1):** Provides for a penalty of ₹10,000 for failure to comply with the provisions of Section 139A.
- **Subsection (2):** Provides for a penalty of ₹10,000 if a person quotes a false PAN which they know or believe to be false.

#### **2. Penalty for Wrong PAN**

**Is There a Penalty for Quoting Wrong PAN in ITR?**
- **No Specific Penalty for Wrong PAN:** As the article mentioned, there is no explicit penalty provision under Section 272B for quoting a wrong PAN in the ITR. The penalty provisions primarily focus on the failure to quote PAN or quoting a false PAN knowingly.
- **Section 272B(2):** Addresses penalties related to quoting a false PAN. If the wrong PAN was given inadvertently and not with fraudulent intent, it might not fall under this provision.

**Implications:**
- **Tax Credit Issues:** The major issue with quoting a wrong PAN is that the tax credits from TDS (Tax Deducted at Source) might not be matched or reflected correctly in your account. This could result in issues while claiming refunds or tax credits.
- **Compliance:** You should correct the PAN details by filing a revised return or informing the Assessing Officer (AO) to ensure accurate processing of your return and tax credits.

#### **3. Corrective Actions**

**Steps to Take if Wrong PAN Was Quoted:**
1. **File a Revised Return:** If the incorrect PAN was quoted, file a revised return with the correct PAN.
2. **Notify the Assessing Officer:** Inform the AO about the mistake in writing and provide the correct PAN details.
3. **Check Tax Credit:** Ensure that the tax credits and TDS are correctly matched with your PAN in your Form 26AS.

#### **4. Key Points to Remember**

- **No Penalty for Inadvertent Errors:** The article's conclusion aligns with the legal provisions that there is no specific penalty for an inadvertent mistake in quoting the PAN in your ITR.
- **Maintaining Accuracy:** Always ensure that the PAN and other details are accurate to avoid complications related to tax credits and processing.

#### **Conclusion**

While there may not be a direct penalty for quoting a wrong PAN, it is crucial to rectify the mistake to avoid issues with tax credits and refunds. Filing a revised return and informing the AO are the recommended steps to correct the error.

If you have further concerns or need personalized advice, consulting a tax professional or legal advisor can provide additional guidance tailored to your specific situation.