Rule 161Published

Rule 161: PAN quotation and authentication for specified banking transactions

Rule 161 requires PAN quotation and authentication for three specified banking or post-office transaction categories. The table covers annual aggregate cash deposits, annual aggregate cash withdrawals and opening a current or cash-credit account. It has its own exceptions and should not be merged with Rule 159’s different table.

Official notified Income-tax Rules, 2026

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On this page

Bare law
The two cash rows use an annual aggregate
Current and cash-credit account opening is separately listed
The institution must ensure quotation and authentication
Government and consular exceptions
The IFSC exception has three cumulative conditions
Keep separate duties and records aligned
Key takeaways
Practical checklist
FAQs
Glossary
Official sources

Bare law

Rule 161 - Transactions for purposes of section 262(9)(a)
(1) For the purposes of section 262(9)(a), every person shall, at the time of entering into a transaction specified in column 2 of the following Table, quote his Permanent Account Number in documents pertaining to such transaction, and every person specified in column 3 of the said Table, who receives such document, shall ensure that the said number has been duly quoted and authenticated:
Sl. No. Nature of transaction Person
1. Cash deposit or deposits aggregating to twenty lakh rupees or more in a financial year, in one or more account of a person with — (i) a banking company or a co-operative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); (ii) Post Office (i) A banking company or a cooperative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); (ii) Post Master General as referred to in section 2(j) of the Indian Post Office Act, 1898 (6 of 1898) (as it existed prior to its repeal) or the Regional Head as referred in the Post Office Rules, 2024 framed under the Post Office Act, 2023 (43 of 2023).
2. Cash withdrawal or withdrawals aggregating to twenty lakh rupees or more in a financial year, in one or more account of a person with,— (i) A banking company or a co-operative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); (ii) Post Office (i) A banking company or a cooperative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); (ii) Post Master General as referred to in section 2(j) of the Indian Post Office Act, 1898 (6 of 1898) (as it existed prior to its repeal) or the Regional Head as referred in the Post Office Rules, 2024 framed under the Post Office Act, 2023 (43 of 2023).
3. Opening of a current account or cash credit account by a person with,— (i) A banking company or a co-operative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); (ii) Post Office (i) A banking company or a cooperative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); (ii) Post Master General as referred to in section 2(j) of the Indian Post Office Act, 1898 (6 of 1898) (as it existed prior to its repeal) or the Regional Head as referred in the Post Office Rules, 2024 framed under the Post Office Act, 2023 (43 of 2023).
(2) The provisions of sub-rule (1) shall not apply in a case where the person carrying out transaction in column 2 of Table is the Central Government, a State Government or a consular office.
(3) The provisions of sub-rule (1) shall not apply in a case,— (a) where the person, carrying out transaction as per Sl. Nos. 1 to 3 of column (2) of Table is a non-resident (not being a company) or a foreign company; (b) the transaction is entered into with an IFSC banking unit; and (c) such non-resident (not being a company) or the foreign company does not have any income chargeable to tax in India.
(4) For the purposes of sub-rule (3), "IFSC banking unit" shall have the meaning assigned to it in rule 159(7)(a).
(5) The Permanent Account Number of an individual shall be submitted to the Principal Director General of Income-tax (Systems), or the Director General of Income-tax (Systems) or the person authorised by the Principal Director General of Income-tax (Systems), or the Director General of Income-tax (Systems) with the approval of the Board, for the purposes of authentication referred to in section 262.
(6) The Principal Director General of Income-tax (Systems) or Director General of Income-tax (Systems) shall lay down the formats and standards along with procedure for authentication of Permanent Account Number.

Sl. No.	Nature of transaction	Person
1.	Cash deposit or deposits aggregating to twenty lakh rupees or more in a financial year, in one or more account of a person with — (i) a banking company or a co-operative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); (ii) Post Office	(i) A banking company or a cooperative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); (ii) Post Master General as referred to in section 2(j) of the Indian Post Office Act, 1898 (6 of 1898) (as it existed prior to its repeal) or the Regional Head as referred in the Post Office Rules, 2024 framed under the Post Office Act, 2023 (43 of 2023).
2.	Cash withdrawal or withdrawals aggregating to twenty lakh rupees or more in a financial year, in one or more account of a person with,— (i) A banking company or a co-operative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); (ii) Post Office	(i) A banking company or a cooperative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); (ii) Post Master General as referred to in section 2(j) of the Indian Post Office Act, 1898 (6 of 1898) (as it existed prior to its repeal) or the Regional Head as referred in the Post Office Rules, 2024 framed under the Post Office Act, 2023 (43 of 2023).
3.	Opening of a current account or cash credit account by a person with,— (i) A banking company or a co-operative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); (ii) Post Office	(i) A banking company or a cooperative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); (ii) Post Master General as referred to in section 2(j) of the Indian Post Office Act, 1898 (6 of 1898) (as it existed prior to its repeal) or the Regional Head as referred in the Post Office Rules, 2024 framed under the Post Office Act, 2023 (43 of 2023).

Rule breakdown

The two cash rows use an annual aggregate

Cash deposits of ₹20 lakh or more and cash withdrawals of ₹20 lakh or more during a financial year, in one or more accounts with the listed bank or post office, are covered by separate rows.

The wording is an aggregate and includes exactly ₹20 lakh. Track deposits and withdrawals under their own rows rather than netting them into one combined cash figure.

Current and cash-credit account opening is separately listed

The third row concerns opening the specified current or cash-credit account with the listed institution. It does not state the ₹20 lakh condition used in the two cash rows.

Do not apply a cash-turnover threshold as though it were a condition of every listed account opening.

The institution must ensure quotation and authentication

PAN is quoted in the transaction documents at the time of the transaction, and the designated receiving person ensures that it has been duly quoted and authenticated.

For an individual’s authentication, the rule describes submission to the specified Systems authority or authorised person. Follow current official technical procedures rather than treating a handwritten number as complete authentication.

Government and consular exceptions

The stated requirement does not apply where the person carrying out the transaction is the Central Government, a State Government or a consular office.

Apply the exception to the identified person and transaction, not to unrelated private customers dealing with a government body.

The IFSC exception has three cumulative conditions

The stated non-resident category or foreign company must transact with an IFSC banking unit and have no income chargeable to tax in India. The defined IFSC banking-unit meaning is imported from Rule 159.

An overseas address or IFSC connection alone is insufficient. Keep the evidence supporting all applicable conditions.

Keep separate duties and records aligned

Review Rule 159 quotation and application obligations, Rule 158 application timing, and this rule’s authentication requirement independently. Keep the relevant transaction, threshold and PAN-authentication record.

Different statutory purposes can have different thresholds; do not replace one rule’s requirements with another’s more familiar figure.

Key takeaways

₹20 lakh or more

The two cash rows use financial-year aggregates.

Account-opening row is distinct

No cash threshold is stated in that row.

Authentication as well as quotation

The receiving institution has a verification role.

Exceptions have defined scope

Check government and cumulative IFSC conditions.

Practical checklist

Track each cash aggregate separately.
Identify the account-opening category.
Obtain the prescribed PAN authentication.
Document every claimed exception condition.

Avoid

Do not substitute Rule 159 thresholds for this table.
Do not assume an overseas address alone proves an exception.

FAQs

Does exactly ₹20 lakh meet the cash threshold?

Yes. The wording is ₹20 lakh or more during a financial year.

Is the account-opening row limited to persons with ₹20 lakh cash transactions?

No. The current or cash-credit account-opening row is separately stated without that threshold.

Can deposits and withdrawals be netted against each other for these rows?

They are separately listed aggregate transaction categories; the rule does not state a net-cash test.

Is non-resident status alone sufficient for the IFSC exception?

No. The stated person, IFSC-unit transaction and absence of Indian taxable income conditions apply together.

Glossary

PAN authentication: The confirmation required under the prescribed Systems process in addition to quoting PAN.

Official sources

Official notified Income-tax Rules, 2026 — Notification 22/2026