As per the notification, the CBDT has said if anyone fails to link a PAN card to an Aadhaar card -- it will become inoperative. It also clarified that in case of users link their PAN with Aadhaar Card after the deadline passes, then the PAN card will “become operative from the date of intimation of the Aadhaar number.”

The central government had added a new section 234H in the Income-tax Act, 1961 – a fee can be levied from individuals if their PAN is linked with Aadhaar after the due date. In case if the PAN is linked with Aadhaar on or after July 1, 2021, then the person will be liable to pay a penalty that cannot exceed Rs 1,000.

What to do if your PAN card has become inoperative?

You won’t be able to conduct financial transactions wherever quoting it is mandatory. The CBDT notification from February 2021 mentions that once the PAN has been linked with Aadhaar, it will become operative again from the date on which PAN has been linked with Aadhaar.

If the PAN card is linked after the deadline i.e. June 30, individuals will be liable for a fee that will be levied under section 234H. Hence, it is advised to link the two before the deadline passes.

According to income tax laws, if an individual’s PAN becomes inoperative because of not linking it with Aadhaar by June 30, and such person is required to furnish or quote PAN, then it shall be deemed that they have not furnished/intimated/quoted the required document. This would make them liable for all consequences under the Income Tax Act.