PAN MANDATORY FOR JWELLERY PURCHASES

Recently, Income Tax Department searched a large number of private lockers and vaults in the city which resulted in unearthing of unaccounted or unexplained jewellery, gold, diamonds and cash in the lockers belonging to people whose whereabouts are not known ie, benami holdings. While this was going on, separately, Income tax department has made it mandatory for all high value buyers of jewellery to declare or mention their Income tax Permanent Account Number (PAN) to the dealer from whom such purchases are made.

Today, everyone knows the need and relevance of income tax permanent account number which is unique to any individual who may or may not be assessee. People inIndiashould now get ready to mandatorily flash PAN card, for any purchase of jewellery worth Rs. five lakh or more from July 1, 2011 a move that would help the tax department keep an eye on such high value transactions. Besides jewellery purchase of Rs. five lakh and above, furnishing of PAN would be mandatory for some other transactions also with effect from July1.

As per the amendments in the income tax rules, coming into effect from July 1, quoting PAN (Permanent Account Number) will be mandatory for any payment of Rs. 5 lakh or more for purchase of bullion or jewellery. High-value purchase of jewellery, among valuables, have often been feared to be a much favoured route for circulation of black money and quoting of PAN would help the tax authorities in tracking such transactions.