Income Tax Department Explains Why PAN Cards Of Some NRIs Were Made Inoperative

The Income Tax department has issued clarification regarding concerns raised by certain Non-Resident Indians (NRIs) and Overseas Citizens of India (OCIs) regarding their PAN cards becoming inoperative. The department mentioned two criteria - filing income tax return once in the last three years and intimating about their residential status to the Jurisdictional Assessing Officer - for making PAN cards inoperative. It also offered a solution to fix the issue. It is to be noted that the income tax department had made linking of PAN card with Aadhaar mandatory and the deadline for the same ended on June 30.

"Concerns have been raised by certain NRIs/ OCIs regarding their PANs becoming inoperative, although they are exempted from linking their PAN with Aadhaar. Further, PAN holders, whose PANs have been rendered inoperative due to non-linking of PAN with Aadhaar, have expressed concern over certain consequences of PAN becoming inoperative," the department said in its tweet.

It then gave a lengthy clarification. 

"ITD has mapped the residential status of NRIs in case they have filed the ITR in any of the last 3 AYs or they have intimated their residential status to the Jurisdictional Assessing Officer (JAO). The PANs have been rendered inoperative, in case any one of the above-mentioned criteria is not met," the IT department said in the tweet.

"The PANs of OCIs/foreign citizens, who may have applied for PAN under resident status and have not corrected/updated their residential status to the Jurisdictional Assessing Officer (JAO) or have not filed ITR in any of the last 3 AYs, have been rendered inoperative," the tweet further said.

The department then asked the NRIs and OCIs to update their residential status on the income tax website.

From July 1, the PAN cards of those individuals who did not link them with Aadhaar were made inoperative. The income tax department had earlier mentioned that it will take action against such individuals, which include higher TDS and TCS rates and no refund for them.