The Central Board of Direct Tax (CBD) has introduced major relief by enhancing ease operation for non-residents in International Financial Services Centre (IFSC)-banking units vide notification no. 88/2023 dated 10th October 2023. This relief specifically addresses the mandatory quoting of Permanent Account number (PAN). In this article we will explore the amendments made by CBDT in Rules 114B, 114BA and 114BB of the Rules.
• Rules 114B of Income Tax Rules, 1962
Pre-amendment:
Income Tax Rule 114B of the Rules mandates the quoting of the Permanent Account Number (PAN) for various financial transactions as prescribed under the rules. If any person does not have the PAN and enter into the transaction prescribed under this rule, then it is required to furnish Form No. 60 either physically or electronically
Post-amendment:
A new proviso has been inserted. This new proviso pertains to foreign companies operating in IFSC who:
and entered into any of the specific transactions as mentioned below,
• Rules 114BA of Income Tax Rules, 1962
Post-amendment:
Rule 114BA provides a list of transactions wherein it shall be mandatory for a person to obtain PAN if a person has entered into the following transactions:
Post-amendment:
The CBDT has introduced the new proviso in Rule 114BA which states that provision of Rule 114BA shall not apply in the following circumstances,
• Rules 114BB of Income Tax Rules, 1962
Post-amendment:
These rules aim to ensure that individuals and entities provide their PAN or Aadhaar numbers for specific financial transactions, with some exceptions, and the same is required to verified by the appropriate tax authorities to maintain accuracy and transparency.
Post-amendment:
The CBDT has effectively extended exemption similar to the provisions outlined in Rule 114BA, which states that provision shall not apply in the following circumstances:
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