Income Tax Rules, 1962 amended to Give Recognition to Transgender

The centre amended the Income Tax Rules, 1962 to give an independent category of gender for obtaining Permanent Account Number (PAN). PAN is a ten digit unique alphanumeric number allotted by the Income Tax department.

In the case of National Legal Services Authority v Union of India, it was held that transgenders are to be placed in the third gender category for availing the services. They faced trouble in linking their 12-digit Aadhaar number to Permanent Account Number (PAN). The notification was issued to recognize transgenders as independent gender.

After the amendment, the PAN application form shall contain a tick box for transgender. This change shall be evident in both forms i.e. Form 49A(PAN application form for Indian citizens) and Form 49AA(PAN application for individuals not a citizen of India).

The notification was issued under section 295 of the Act by Central Board for Direct Taxes.  The notification, issued under sections 139A and 295 of the Income Tax Act, specifies the new application process for obtaining a PAN number by an individual for easier tax-related transactions.

The government has now made disclosing of Aadhaar Number mandatory for filing income tax returns (ITRs) as well as obtaining a new PAN. Section 139 AA (2) of the Income Tax Act provides that every person having PAN as on July 1, 2017, and eligible to obtain Aadhaar, must intimate his Aadhaar number to the tax authorities.