The government has launched the facility for instant allotment of PAN. This facility is now available for all applicants who possess a valid Aadhaar number and have a mobile number registered with Aadhaar.
Investors can generate new PAN by visiting the e-filing website of the Income Tax Department and keying in their Aadhaar number. On successful submission of OTP received on registered mobile number, the system would generate a 15-digit acknowledgement number which is required to download ePAN.
The e-PAN is also sent to the applicant on his email id, if it is registered with Aadhaar.
The allotment process is paperless and an electronic PAN (e-PAN) is issued to the applicants free of cost.
The Finance Minister in the Union Budget 2020 had proposed to generate new PAN immediately based on Aadhaar.
In her Budget proposal, Finance Minister Nirmala Sitharaman had said, “We will launch a system under which PAN shall be instantly allotted online on the basis of Aadhaar without any requirement for filling up of detailed application form.”
The move will make it easier for investors to enter mutual funds and insurance industry as the PAN is mandatory in mutual funds. In last year’s budget, the government had allowed interchangeability of PAN and Aadhaar i.e. using Aadhaar where PAN is required. However, the move did not fare well for investors with SEBI making PAN mandatory for all mutual fund transactions including redemptions last year. In fact, PAN exempt folio holders will have to update their KYC details with PAN to redeem their investments from mutual funds.
There are over 121 crore Aadhaar card holders in India, whereas only around 49 crore individuals possess PAN.
