The Centre told the top court that it was aware of the situation and was taking necessary steps to correct the anomaly.
"We are concerned with the solution to the problem. Either you correct Aadhaar or the PAN, but it should be corrected," a bench of Chief Justice Dipak Misra and Justices A M Khanwilkar and D Y Chandrachud said.
Attorney General K K Venugopal, appearing for the Centre, assured the bench that the government was alive to the situation and was taking all necessary steps to correct the anomaly which has surfaced in the linking of PAN with Aadhaar of transgender persons.
Senior advocate C U Singh, appearing for the petitioner, said direction should be passed to the Centre for ensuring a separate third gender category option on PAN cards to enable transgender persons to link it with Aadhaar should be there.
He said due to non-availability of third gender category in PAN, there is a problem linking it to Aadhaar.
Earlier, the top court had sought the assistance of the Attorney General in dealing with a similar plea filed by a transgender person alleging that her attempt to link PAN with Aadhaar had failed as the PAN card had no 'third gender' option unlike the Aadhaar card.
Reshma Prasad, a social activist from Bihar, had sought a direction to the Centre to create a separate third gender category option on PAN cards to enable transgender like her to link it with Aadhaar to get an "accurate identity proof".
The Aadhaar system, she said, included the category of the third gender after a top court verdict and she had registered as a transgender in it.
She has been using Aadhaar as the identity proof and availed all benefits provided by the government through Aadhaar Card, the plea said.
Ms Prasad, who had written 'male' as gender while getting PAN, received Aadhaar under the transgender or third gender category.
However, when she had to link the PAN with Aadhaar, she could not do so due to dual gender identity.
Earlier, a similar plea was filed by a Mumbai-based transgender saying the issue was serious since a failure to link the two can even invite criminal prosecution and adding that there is a provision to invalidate the PAN card over failure to link it with Aadhaar.