As per the Central Board of Direct Taxes, the Income Tax Department can now share the PAN data of an individual or an entity with Financial Intelligence Unit (FIU). This sharing of data will assist FIU to dig deeper into large cash transaction or any suspicious transactions at the banks. The order to share the data was issued on July 16.
Financial Intelligence Unit was set by the Government of India in November 2004 as the central national agency responsible for receiving, processing, analyzing and disseminating information relating to suspect financial transactions.
FIU-IND is also responsible for coordinating and strengthening efforts of national and international intelligence, investigation and enforcement agencies in pursuing the global efforts against money laundering and financing of terrorism. FIU-IND is an independent body reporting directly to the Economic Intelligence Council (EIC) headed by the Finance Minister.
Here are the five key points of the CBDT order:
1)A bank has to furnish a CTR or, a cash transaction report to the FIU every month. The CTR should have details of all transactions over ₹10 lakh or its equivalent in foreign currency or a series of integrally connected transactions that add up to more than ₹10 lakh .
2)The FIU is empowered to get the CTRs under the Prevention of Money Laundering Act (PMLA).
3)As per the procedure, banks provide the CTRs to FIU with only the PAN (permanent account number) that was mentioned on the transaction slip or record and that does not include any other details like name of the PAN holder and other information about them, said a PTI Report.
4)The CBDT order said the sharing of PAN data with FIU will be under two heads:
-In the first case, if the FIU has the PAN then the taxman will share the name of the PAN holder, their father/husband’s name, address, date of birth or incorporation date (in case of companies), the year of filing the last income tax return, gross total income range, turnover range and some other information will be provided by the I-T department to the FIU.
-In case the FIU does not have the PAN for a cash transaction report, the tax department will provide it “a dump of PAN database” to enable it to search.
5)”While furnishing the information, the specified income-tax authority shall form an opinion that sharing of such information is necessary for the purposes of enabling the FIU to perform its function under its respective laws,” the CBDT said.
The CBDT order further said that the CBDT and the FIU will soon a sign a memorandum of understanding (MoU) to formalise the data sharing regime.