3. E'mailed to Business Line on 08-23-'06

QUOTE

This refers to "SEBI to resume UIN registration" (Business Line, August 23). As regards PAN, under the Income-tax Act/Rules, it is made mandatory, only in the case of, among others, a person chargeable to income-tax and if the value of any of his transactions in ecurities/shares exceeds the minimum prescribed (Rs 1 lakh/50,000). However, SEBI has, ignoring the aforesaid basic criteria, issued two directives purporting to make PAN mandatory for all demat account holders and all entities/persons transacting in the cash market, effective from 1st October 2006. As such, the directives, in so far as they mandate PAN on a blanket basis, contrary to /overstepping what is provided in the Income-tax Act/Rules are prima facie in excess of the powers of SEBI.

As regards UIN, this is going to simply add to the already existing list of several identification numbers for different purposes, including direct and indirect taxes, passport, electoral roll, etc., but may eventually serve no significant purpose. For, as past experience might have demonstrated, the present regime of several identification numbers has the necessary consequence of the utility or efficacy of all or many of them being diluted. Instead, why not our country emulate the wisdom of Singapore, where every person is, right from his birth/coming into being, compulsorily allotted a single identification number (known as NRIC) and required to quote it for almost all practical purposes, governmental or otherwise? As that might, for obvious reasons, ensure the sole underlying objective of an overall effective governance and enforcement.

UNQUOTE

PS: According to a rcent media report, the value of the demat accounts frozen pursuant to SEBI's mandate on PAN run into over a lakh of crores in rupees (?).