Business PAN Closure/Deregistration

In income tax, closing a PAN is termed as "Darta Staghan" (Registration Suspension).

In VAT, closing a PAN is termed as "Darta Khareji" (Registration Cancellation).

(However, in general, both refer to the closure of a business PAN.)

If the business is registered only for income tax, a "Janchbujh" (Inquiry/Review) is conducted before closure.

If the business is also VAT-registered, a "Kar Parikshan" (Tax Audit/Assessment) is conducted before closure.

(In both cases, relevant business documents and proof must be submitted, and the tax office verifies transactions, tax liabilities, and payments.)

Once the closure application is submitted:

Businesses registered only for income tax are closed within 30 days. (Rule 23K)

Businesses registered under VAT are closed within 3 months. [Section 11(3)]

(If there are any discrepancies or reasons preventing closure, the tax office notifies the taxpayer within this period.)

Closure Process:

1. Obtain a Tax Clearance Certificate from the tax office.

2. Close the business registration at the initial registration authority (e.g., Ward Office, Cottage Industry Office, Chamber of Commerce, or Company Registrar's Office).

3. Submit the closure proof to the tax office.

4. The tax office processes PAN deregistration accordingly.

Important: Before closing VAT registration, all stock must be cleared at market value.