Aadhaar-PAN linking: Govt proposes changes to ease process but renders it futile; here's why

The Income Tax department, short of annulling the recently introduced mandatory Aadhaar-PAN linkage, has climbed down its high horse so much so that one wonders whether the linkage was worth it at all in the first place.  The department has done two things for two sets of common problems encountered by the harried taxpayers:

Those who have just initials in Aadhaar while having the full expanded name in the other document, i.e. PAN, can overcome the mismatch by logging into the Aadhaar website --(uidai.gov.in<http://uidai.gov.in/) -- and giving the fuller name as appearing in PAN.  The program will understand and note in the name column the expanded name as well.  But the Aadhaar website is quite fastidious: it asks for proof.  The income tax department has got the Aadhaar website to accept the PAN card as proof.  Just scan the PAN and upload it into the Aadhaar website while seeking change of name, exhorts the income tax department.

Those who have divergent names transcending just the initials versus full name dichotomy don’t have to worry either says the income tax department.  For example, Kavita Nagpal may be the name on the Aadhaar card post marriage of a woman.  But she might have been Kavita Sharma before marriage when she started paying taxes.  Don’t worry says the department.  While validating your tax return, an OTP would be generated and sent in such cases to the Aadhaar-registered mobile number where the two names can be mentioned.  Once again the software -- this time round the income-tax department’s -- would nod sagely and accept the dichotomy philosophically.  Unlike in the first case, where a scanned copy of PAN is to be uploaded into the Aadhaar website, here the caveat is the date of birth in the two documents should match. Period.  If they match, the return would stand validated despite the discrepancy in the name in the two seeded documents.

Representational image. Reuters.

Representational image. Reuters.

Now let us face the practical difficulties first.  Not everyone has an Aadhaar-registered cell number for the simple reason that when Aadhaar made its mark, cell numbers were neither asked for nor given.  There was simply no field for it in the software at that time.  Of course, the void has been subsequently filled by the UIDAI but its software does not accept any changes without the change being done on the basis of OTP (one time password) sent to one’s Aadhaar-registered mobile number.  A chicken and egg conundrum indeed.  So what to do? Hotfoot to the nearest Aadhaar office or agent and sit or stand patiently just to add the cell number.  Once the cell number is registered, the PAN bearing the fuller name can be uploaded.

The problem does not end here.  It is not as if the PAN card always bears the full name.  In my own case, the PAN just shows my initial whereas the full name lies buried in the system.  Now in such cases the Aadhaar website would reject the uploaded scanned PAN.  The better course would have been to allow Aadhaar access to the income tax department website so that verification could have been completed at the levels of two giant software not dragging the taxpayer into the melee.

Now the conceptual problem. Finance Minister Arun Jaitley gave the rationale of eliminating bogus returns for insisting on seeding PAN with Aadhaar given the fact that Aadhaar has biometric features that stumps imposters and charlatans.  Fine.  But wouldn’t the dilution of strict matching of names to that extent encourage charlatans especially given the fact that Aadhaar originally contained only the year of birth without specifying the date of birth?

The government ought to have addressed the problem of fictitious returns to split the income among numerous persons to get away with lower taxes in a different manner than seeding PAN with Aadhaar -- dispensing with PAN and relying just on Aadhaar.  Statistics support the need for this course of action.  Aadhaar has been issued to 111 crore people but PAN only to 25 crore people out of whom there are just six crore taxpaying persons.  Around 1.08 crore persons have successfully linked their PAN with Aadhaar.  This points to the scale of the problem as well as the course of action to be taken.  Gun after tax evaders on the basis of their Aadhaar identity.  Jaitley has already said soon Aadhaar would be only identity document and PAN would be rendered redundant.

Skeptics rightly aver that Aadhaar is not by any means a reliable document given the fact that most of the fields in it are filled in on the basis of self-declaration, whereas PAN at least is more robustly supported by documents.  This is, however, another story for another time.

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Updated Date: Apr 10, 2017 08:11:29 IST

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