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2016 (3) TMI 761 - HC - Income TaxCancellation of PAN - two PANs issued for same society - PAN AAETS5043H has been marked as FAKE - whether the error in the spelling of the name of the Society in the application filed by Mr. Navneet Kumar for a PAN card (that has now been termed as FAKE ) was innocent or deliberate?- Held that - The fact of the matter is that there cannot be two PAN Cards for one entity. Since there is already a PAN Card issued in the name of the Society way back in 1997 there cannot be another PAN Card issued to it in 2004. Therefore, sending the matter back to Respondent No. 1 for a fresh decision will serve no purpose. The real dispute is which of the two factions of the Society should be recognised as being competent and authorised to operate the said PAN Card? That will obviously depend on the orders that may be passed in the pending suit. From that point of view, the action of Respondent No.1 cannot be said to be illegal or invalid for cancellation of PAN - Decided against assessee.
Issues:
1. Validity of the order to cancel PAN card 'AAETS5043H' without a hearing. 2. Dispute over the name and identity of the society leading to the issuance of two PAN cards. 3. Allegations of fraudulent practices in obtaining the PAN card. 4. Interpretation of guidelines for marking a PAN card as 'FAKE'. 5. Legal implications of spelling errors in the application for a PAN card. Analysis: 1. The petition challenged the order to cancel PAN card 'AAETS5043H' without a prior hearing, alleging a violation of natural justice principles. The petitioner argued that the cancellation led to criminal complaints and requested the order to be quashed. However, the Court noted that even with a hearing, the outcome would likely remain the same given the circumstances leading to the order. 2. The dispute arose from the naming discrepancy of the society, with one faction using 'SRIRAM CHANDRA MISSION' and the other 'SHRI RAM CHANDRA MISSION'. This resulted in the issuance of two PAN cards for the same entity, leading to the cancellation of the second card. The Court highlighted the ongoing civil suit between the factions to determine the legitimate successor to the society's presidency. 3. The Income Tax Department alleged that the second PAN card was obtained fraudulently due to the naming error in the application. The Department followed guidelines to mark the subsequent PAN as 'FAKE' based on discrepancies in the application details and existing records of the society. 4. The Court examined the guidelines for marking a PAN card as 'FAKE', emphasizing that two PAN cards cannot be issued to one entity. The Department's decision to cancel the second card was upheld, considering the established PAN card issued to the society in 1997. 5. The spelling error in the application for the PAN card, using 'SRIRAM CHANDRA MISSION' instead of 'SHRI RAM CHANDRA MISSION', was a crucial factor leading to the cancellation. The Court noted that the naming discrepancy was at the core of the issue, emphasizing the importance of accurate information in such applications. Overall, the Court dismissed the petition and the pending application, highlighting the necessity to resolve the society's internal dispute to determine the legitimate authority over the PAN card. The judgment underscored the significance of adhering to legal procedures and accurate documentation in matters concerning tax-related identities.
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