New Delhi, Aug 08: The public accounts committee today criticised the finance ministry for delay in allotment of Permanent Account Numbers (PAN) and said it was proving inconvenient for the general public to mandatorily cite Pan for even simpler transactions like opening a bank account.

"The delay in allotment of Pan, failure of the government to link all major cities for sharing of data and to set up an all India databank of major financial transactions somewhat diluted the efficacy of the scheme," Pac said in its report tabled in Parliament today.
Pan was introduced after amendments in the section 139A of the Income Tax Act in 1995 and application for its allotment was made mandatory for all tax payers in 1998.
"An apprisal of the scheme reveals that the objectives of Pan scheme could not be fully achieved even after five years of its launching, as the department was not able to allot Pans to all identified assessees," it said.
One of the purpose of using Pan was to identify taxpayers and collate information relating to tax payments and high value transactions.



On the other hand, Pac said "citing of Pan as mandatory for relatively simpler financial transactions, for instance opening of a bank account, which was required by even a minimum wage earner, was proving to be an inconvenient and cumbersome procedure for the general public."



"The ministry may consider revising the list of transactions under Rule 114B of Income Tax Act and focus on setting up an all India databank of high value transactions expeditiously alongwith an action plan to utilise such a data bank effectively," it said.


Bureau Report