Abhay Gupta v. Union of India & Ors.

What happened

Abhay Gupta filed a public interest petition seeking a direction to the authorities to prescribe a timeframe for deciding applications for cancellation of dual Permanent Account Numbers. His counsel said that section 139A(7) of the Income-tax Act provides that a person can be allotted only one PAN and cannot apply for, obtain or possess another, and that under CBDT Circular No. 7 of 2022 of 30 March 2022 an additional PAN must be surrendered before the retained PAN can be linked with Aadhaar. Neither the Act nor any circular lays down a time within which the Assessing Officer must decide such an application, and the reply to his application under the Right to Information Act, 2005 did not specify one either. During the pendency of such an application, he said, a taxpayer may find it difficult to file returns and use PAN-linked services.

Questions before the court

• Should the Court direct the authorities to prescribe a timeframe within which applications for cancellation of a duplicate PAN must be decided?

Why the court ruled this way

The revenue said that the relief amounts to a request for amending the rules and administrative framework, but it was equally concerned that such applications should not remain pending for an unduly long time and should be decided with due expedition. The Court recognised that the absence of a timeframe may cause hardship to taxpayers during the pendency of an application, particularly in filing returns and using PAN-linked services (paragraph 10). Since the petitioner had not made any representation to the CBDT before filing the petition, it considered the grievance better addressed by allowing him to make one (paragraph 11).

Controlling point

The absence of a prescribed period for deciding duplicate-PAN cancellation applications can cause hardship, but the grievance is better addressed by a representation to the CBDT, which must decide it within a fixed period.

Order and next steps

Liberty was granted to the petitioner to submit a detailed representation to the CBDT within a fortnight, setting out the difficulties caused by the lack of a prescribed timeframe. If it is submitted, the CBDT shall consider it and take an appropriate decision in accordance with law within eight weeks of receipt, and communicate the decision to the petitioner. The petition was disposed of.

Practical implications

A taxpayer with two PANs who is held up in linking PAN with Aadhaar or filing returns should apply to the Assessing Officer to cancel the additional PAN and keep proof of the application. The ruling does not set a deadline for such cancellations; it only directs the CBDT to consider a representation on the point.

Limits of this ruling

• The Court did not itself prescribe any timeframe, and the CBDT's eventual decision on the representation is not part of this order.