Form 60 Can’t be Submitted by a Co. or Firm that is Involved in a Transaction Specified Under Rule 114B | CBDT

Notification No. 88/2023, dated 10-10-2023

The Central Board of Direct Taxes (CBDT) has issued notified the Income-tax (Twenty-fourth Amendment) Rules, 2023, amending rules related to obtaining and quoting Permanent Account Number (PAN). The amendments have been made in Rules 114B, 114BA and 114BB, which are discussed in the following paragraphs:

1. Amendment in Rule 114B

Rule 114B points out various transactions in relation to which quoting of PAN is mandatory. The second proviso to Rule 114B allows a person to furnish a declaration in Form No. 60 if he doesn’t possess a PAN.

The CBDT has amended this proviso to exclude a company or a firm from the requirement to furnish Form No. 60.

Also, a new proviso has been inserted to allow a foreign company to furnish a declaration in Form No. 60 if such foreign company has no income which is chargeable to income tax in India and does not have PAN. This relaxation is available only with respect to the following transactions entered into with an IFSC banking unit:

a. Opening an account [other than a basic savings bank deposit account] with the bank;
b. A time deposit if the amount of deposit exceeds Rs. 50,000 in each transaction or Rs. 5 lakhs in aggregate during a financial year with bank, post office, Nidhi Co. or NBFC.

2. Amendment in Form 60

To incorporate the change made in Rule 114B, Form 60 has also been amended. Two extra fields have been introduced in row 23 to capture the following information:

a. Income chargeable to tax (for a foreign company).
b. Income not chargeable to tax (for a foreign company).

3. Amendments in Rule 114BA and Rule 114BB

Rule 114BA lists the following three additional situations in which a person is required to obtain PAN:

a. Cash deposit of Rs. 20 lakh or more with bank or post office;
b. Cash withdrawal of Rs. 20 lakh or more with bank or post office;
c. Open a current account or cash credit account with the bank or post office.

Further, Rule 114BB stipulates that a person must quote either his PAN or Aadhaar number if he enters into any of the above three transactions.

Both rules have been amended to offer clarity with respect to non-residents and foreign companies.

A new proviso has been inserted to provide that provisions of these rules do not apply if a non-resident or foreign company conducts transactions with an IFSC banking unit that involve deposits or withdrawals through means other than cash or opening a current account that is not a cash credit account.

However, the benefit is available subject to the condition that non-resident/foreign company has no income chargeable to tax in India.

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