Late fee/ penalties for default/ offences under Income Tax
|Section||Nature of default||Quantum of penalty||Comments|
Fee for default in furnishing statements of TDS or TCS
|₹200/- for every day during which the failure continues||Maximum limit: upto amount of tax deductible or collectible|
|234F||Fee for default in furnishing return of income.||₹ 1000/-( if the total income of the person does not exceed ₹ 5 lakh)/ ₹ 5000( in other cases)||
234F substituted by Finance Act 2021. Earlier it was ₹ 1000/-( if the total income of the person does not exceed ₹ 5 lakh)/ ₹ 5000( in other cases if ITR filed after due date but upto 31st December of the AY)/ ₹ 10,000( in other cases if ITR filed after 31st December of the AY)
|234G||Fee for default relating to statement or certificate as required under section 35/80G||₹200/- for every day during which the failure continues.||Maximum fee upto the amount in respect of which the failure referred to therein has occurred;
Section 234G inserted by Finance act 2021.
Late fee for non- intimation of Aadhaar number
|Prescribed fee upto ₹1000/-||Consequence of Non- linking of PAN and Aadhaar. New section inserted by Finance Act 2021|
Failure to pay wholly or partly, self-assessment tax, interest, or late fee
|Such amount as Assessing Officer may impose but not exceeding tax in arrears||Within 30 days of service of notice, penalty for default in tax payment would be levied.|
|Penalty for a default in payment tax demand as per demand notice except where stay granted
|Such amount as Assessing Officer may impose but not exceeding tax in arrears||Within 30 days of service of the notice under section 156.|
Penalty for under-reported income is in consequence of any misreporting thereof by any person
|The penalty would be equal to 50% of the tax liability calculated on the under-reported income.||Exclusion list under-reported income. Section 270A(6)
|Misreporting of income so that the income can be under-reported, the penalty would increase. In such cases, the penalty would be 200% of the tax liability calculated on the misreported income.||
cases of misreporting of income as per section 270A(9) are as under:
(a) misrepresentation or suppression of facts;
(b) failure to record investments in the books of account;
(c) claim of expenditure not substantiated by any evidence;
(d) recording of any false entry in the books of account;
(e) failure to record any receipt in books of account having a bearing on total income; and
(f) Failure to report any international transaction or any transaction deemed to be an international transaction or any specified domestic transaction, to which the provisions of Chapter X apply.
|271A||Penalty for not maintaining books of accounts and/or other required documents not retaining such books or documents for specified period
|₹ 25000/-|| Books of account and other documents as required by section 44AA or the rules made thereunder.
Penalty could be imposed by AO or CIT(A)
|271AA||Penalty for failure to keep and maintain information and document, or maintaining incorrect information for international transaction or specified domestic transaction.||2% of the value of each international transaction or specified domestic transaction.
Note: penalty by AO/ CIT (A).
| Nature of failure:
(i) fails to keep and maintain any such information and document as required by section 92D(1)/92D(2);
(ii) fails to report such transaction which he is required to do so; or
(iii) maintains or furnishes an incorrect information or document,
|271AAA||Where search has been initiated before 1-7-2012 and undisclosed income found||10% of undisclosed income||
Note: search on or after 01-07-2012 penalty under section 271AAA.
Where search has been initiated on or after 1-7-2012 and undisclosed income found
|(a) 10% of undisclosed income of the specified previous year if assessee admits the undisclosed income; substantiates the manner in which it was derived; and on or before the specified date pays the tax, together with interest thereon and furnishes the return of income for the specified previous year declaring such undisclosed income;
(b) 20% of undisclosed income of the specified previous year if assessee does not admit the undisclosed income, and on or before the specified date declare such income in the return of income furnished for the specified previous year and pays the tax, together with interest thereon;
© 60% of undisclosed income of the specified previous year if it is not covered by (a) or (b) above1
|Lesser penalty of 10% when undisclosed income admitted where as higher penalty if undisclosed income not admitted.|
|271AAB(1A)||Where search has been initiated on or after 15-12-2016 and undisclosed income found||
Lesser penalty of 10% when undisclosed income admitted where as higher penalty if undisclosed income not admitted.
|271AAC||Where income determined includes any income referred to in section 68, section 69, section 69A, section 69B, section 69C or section 69D for any previous year.||Penalty @10% of tax payable under section 115BBE(1)(i) besides tax under section 115BBE.
Note: No penalty under the provisions of section 270A shall be imposed upon the assessee in respect of the income referred to in section 271AAC(1).
| Tax under section 115BBE(1)(i) @ 60% .
Note: Provided that no penalty shall be levied to the extent such income has been included by the assessee in the ITR furnished under section 139 and the tax in accordance with the provisions section 115BBE(1)(i) has been paid on or before the end of the relevant previous year.
Note: no deduction for any expenditure or allowance or set off of loss allowed in such income.
|271AAD||Penalty for false entry, or omission of any entry which is relevant for computation of total income of such person, to evade tax liability, in books of account.
Note: section 271AAD Inserted by the Finance Act, 2020, w. e .f. 1-4-2020 to tackle fake invoices.
|Penalty equal to the aggregate amount of such false or omitted entry.
Meaning of false entry:
false entry” includes use or intention to use—
(a) forged or falsified documents such as a false invoice or, in general, a false piece of documentary evidence; or
(b) invoice in respect of supply or receipt of goods or services or both issued by the person or any other person without actual supply or receipt of such goods or services or both; or
(c) Invoice in respect of supply or receipt of goods or services or both to or from a person who does not exist.
This penalty may be imposed on person other than assessee: AO may direct that any other person, who causes in any manner to make a false entry or omits or causes to omit any entry referred to in that sub-section, shall pay by way of penalty a sum equal to the aggregate amount of such false or omitted entry.
Note: besides penalty under income tax, no ITC credit shall be available in GST and also penalty for availing wrong ITC. For availing ITC, goods or services must have been received besides the invoice.
|Failure to get accounts audited or furnish report of CA||AO may impose penalty, equal to 0.5% of the total sales, turnover or gross receipts, as the case may be, of business, or of the gross receipts in profession, in such previous year or years or a sum of ₹ 1.50 lakh whichever is less||Penalty for failure to get his accounts audited in respect of any previous year or years relevant to an AY or furnish a report of such audit as required under section 44AB.
Note: Discretionary penalty in the hand of AO.
|271BA||Penalty for failure to furnish report under section 92E.||Assessing Officer may direct that such person shall pay, by way of penalty, a sum of ₹ 1 lakh.||Discretionary penalty in the hand of AO.|
|271C||Penalty for failure to deduct tax at source.
If any person fails to—
(a) deduct the whole or any part of the tax as required by or under the provisions of Chapter XVII-B; or
(b) pay the whole or any part of the tax as required by or under—
(i) sub-section (2) of section 115-O; or
(ii) the second proviso to section 194B,
Penalty, a sum equal to the amount of tax which such person failed to deduct or pay as aforesaid.
Penalty imposable under sub-section 271C shall be imposed by the Joint Commissioner.
Penalty for failure to collect whole or part of the tax at source.
|Penalty, a sum equal to the amount of tax which such person failed to collect tax.||Penalty imposable under sub-section 271CA shall be imposed by the Joint Commissioner.|
|271D||Penalty for failure to comply with the provisions of section 269SS. If a person takes or accepts any loan or deposit or specified sum in contravention of the provisions of section 269SS.||Penalty equal to the amount of the loan or deposit or specified sum so taken or accepted.
Note: specified advance” means any sum of money in the nature of advance, by whatever name called, in relation to transfer of an immovable property, whether or not the transfer takes place.
|Penalty imposable under sub-section 271D shall be imposed by the Joint Commissioner.
Note: Generally this section get attracted if receipts loan or deposit in cash exceeding threshold limit of ₹ 20000/- in a FY.
|271DA||Penalty for failure to comply with provisions of section 269ST.
Limit of receipts in cash exceeding ₹ 2 lakh from a person in day / on one event or occasion from a person even on different dates.
|Penalty equal to the amount of such receipt.||
No penalty shall be imposable, if such person proves that there were good and sufficient reasons for the contravention.
Penalty imposable under sub-section 271DA shall be imposed by the Joint Commissioner.
Penalty for failure to comply with provisions of section 269SU.
Under section 269SU certain persons ( if turnover, sales or gross receipts of preceding PY exceeds ₹ 50 crore) are required to provide facility for accepting payment through the prescribed electronic modes of payment.
|₹ 5000/- for every day during which such failure continues.
Note: no such penalty shall be imposable if such person proves that there were good and sufficient reasons for such failure.
Note: Penalty imposable under sub-section 271DB shall be imposed by the Joint Commissioner.
|If a person who is required to provide facility for accepting payment through the prescribed electronic modes of payment referred to in section 269SU, fails to provide such facility. Penalty per day without maximum limit.|
|271E||Penalty for failure to comply with the provisions of section 269T. Prohibition on to repays any [loan or] deposit or specified advance referred to in section 269T otherwise than in accordance with the provisions of that section||Penalty, equal to the amount of the loan or deposit or specified advance so repaid.
Note: specified advance” means any sum of money in the nature of advance, by whatever name called, in relation to transfer of an immovable property, whether or not the transfer takes place.
Generally this section get attracted if payment in cash exceeding threshold limit of ₹ 20000/- in a FY.
Penalty for failure to furnish return of income.
|₹ 5000/-||Not applicable from AY 2018-19 , because late imposed under section 234F of ₹ 1000 /5000 /10000|
|271FA||Penalty for failure to furnish statement of financial transaction or reportable account under section 285BA(1)||₹ 500/- for every day during which such failure continues.
Provided that where such person fails to furnish the statement within the period specified in the notice issued under section 285BA(5), he shall pay, by way of penalty, a sum of ₹ 1000/-for every day during which the failure continues, beginning from the day immediately following the day on which the time specified in such notice for furnishing the statement expires.
|furnishing of statement by post master general, Registrar or Sub-Registrar, recognised stock exchange, RBI etc. in respect of such specified financial transaction or such reportable account which is registered or recorded or maintained by him and information relating to which is relevant and required for the purposes of this Act, to the income-tax authority or such other authority or agency as may be prescribed|
|271FAA||Penalty for furnishing inaccurate statement of financial transaction or reportable account.||
(a) the inaccuracy is due to a failure to comply with the due diligence requirement prescribed under section 285BA(7) or is deliberate on the part of that person; or
(b) the person knows of the inaccuracy at the time of furnishing the statement of financial transaction or reportable account, but does not inform the prescribed income-tax authority or such other authority or agency; or
(c) the person discovers the inaccuracy after the statement of financial transaction or reportable account is furnished and fails to inform and furnish correct information within the time specified under sub-section (6) of section 285BA,
|271FAB||Penalty for failure to furnish statement or information or document by an eligible investment fund.||₹ 5 lakh||Prescribed income-tax authority under the said sub-section 9A (5) may direct that such fund shall pay, by way of penalty.|
|271G||Penalty for failure to furnish information or document under section 92D.||Penalty equal to 2% of the value of the international transaction or specified domestic transaction] for each such failure.||Penalty may be imposed by Assessing Officer or the Transfer Pricing Officer as referred to in section 92CA or the Commissioner (Appeals)|
|271GA||Penalty for failure to furnish information or document under section 285A.
Note: information by Indian concern having interest or share in a company or entity registered or incorporated outside India deriving its value substantially from assets located in India
|(a) 2% of the value of the transaction in respect of which such failure has taken place, if such transaction had the effect of directly or indirectly transferring the right of management or control in relation to the Indian concern;
(b) ₹ 5 lakh in any other case
prescribed income-tax authority, may direct that such Indian concern shall pay penalty.
Penalty for failure to furnish report or for furnishing inaccurate report under section 286 in respect of international group.
|(a) ₹5000/- for every day for which the failure continues, if the period of failure does not exceed one month;
(b) ₹ 15000/- for every day for which the failure continues beyond the period of one month.
|Reporting parent entity not resident in India in form 3CEAC to 3CEAE under rule 10DB in prescribed manner.|
|271H||Penalty for failure to furnish statements of TDS under section 200(3) /TCS under section 206C(3) or furnishes incorrect information||₹ 10000/- to ₹ 1 lakh
Note: AO has discretion to impose any penalty in the range.
|Assessing Officer may direct that a person shall pay by way of penalty.
Note: no penalty if after paying tax deducted or collected along with the fee and interest, statement filed within a period of one year from the time prescribed for delivering or causing to be delivered such statement
|271-I||Penalty for failure to furnish information or furnishing inaccurate information under section 195(6).||₹1 lakh||
Form 15CA by payer /15CB( certificate from CA) /15CC( authorised dealer) rule 37BB.
Penalty for furnishing incorrect information in reports or certificates
|₹ 10000/- for each such report or certificate.||Penalty may be imposed on accountant or a merchant banker or a registered valuer.
Penalty by AO or CIT(A)
|271K||Penalty for failure to furnish statements, or certificate of donations or contributions u/s 35 or 80G||Assessing Officer may direct that a sum of ₹ 10000- ₹ 1 lakh||Statement to filed on portal and certificate to be downloaded and issued to donor.
Note: Inserted by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, w.e.f. 1-4-2021.
|272A||Penalty for failure to answer questions, sign statements, furnish information, returns or statements, allow inspections, etc.||272A(1) refuses to answer any question put to him/ refuses to sign any statement made / failure of directions of summons is issued/ fails to comply with a notice u/s 142/143 – ₹10000/-
272A(2) failure – ₹ 100/- per day during which the failure continues
|Important failure under 272A(2) are : fail
a) to comply with a notice issued under section 94(6)
b) to give the notice of discontinuance of his business or profession as required by section 176(3);
c) to furnish in due time any of the returns, statements or particulars mentioned in section 133 or section 206 or section 206C or section 285B;
d) to allow inspection of any register referred to in section 134 or of any entry in such register or to allow copies of such register or of any entry therein to be taken
e) to furnish the return of income which he is required to furnish under sub-section (4A) or sub-section (4C) of section 139 or to furnish it within the time allowed and in the manner required under those sub-sections; or
f) to deliver or cause to be delivered in due time a copy of the declaration mentioned in section 197A; or
g) to furnish a certificate as required by section 203 [or section 206C; or
(h) to deduct and pay tax as required by sub-section (2) of section 226;
(i) to furnish a statement as required by sub-section (2C) of section 192;
(j) to deliver or cause to be delivered in due time a copy of the declaration referred to in sub-section (1A) of section 206C;
[(k) to deliver or cause to be delivered a copy of the statement within the time specified in section 200(3) or the proviso to section 206C(3);
[(l) to deliver or cause to be delivered the statements] within the time specified in section 206A(1);
(m) to deliver or cause to be delivered a statement within the time as may be prescribed under section 200(2A) or section 206C(3A),]
|272AA||Penalty for failure to comply with the provisions of section 133B.||penalty, a sum which may extend to ₹1000/-||Under section 133B income-tax authority has power to collect certain information which may be useful for, or relevant to, the purposes of income tax Act.|
|272B.||Penalty for failure to comply with the provisions of section 139A pertaining to obtaining PAN or quoting invalid PAN/ wrong PAN||₹10000/-
Note: in CIT v. DHTC Logistics Ltd.  221 Taxman 83 (Delhi) it was held that penalty under section 272B is linked to a person (i.e., a deductor who has committed the default of giving incorrect information of PAN of deductees). Maximum penalty is Rs. 10,000. It is not Rs. 10,000 per default. For example if 5 wrong PAN penalty will be ₹ 10000/- only and not ₹ 50000/-.
|No order under sub-section (1) or sub-section (2) or sub-section (2A) or sub-section (2B)] shall be passed unless the person, on whom the penalty is proposed to be imposed, is given an opportunity of being heard in the matter.]|
|272BB.||Penalty for failure to comply with the provisions of section 203A. quoting TAN||₹10000/-||No order under sub-section (1) or sub-section (1A)] shall be passed unless the person on whom the penalty is proposed to be imposed is given an opportunity of being heard in the matter.|
|272BBB.||Penalty for failure to comply with the provisions of section 206CA which is related to applying and obtaining TAN no.||₹10000/-||
No order under sub-section (1) shall be passed unless the person on whom the penalty is proposed to be imposed, is given an opportunity of being heard in the matter.]