Disclaimer:

The contents of this document are for information purposes only. This aims to enable public to have a
quick and an easy access to information and do not purport to be legal documents.

Viewers are advised to verify the content from Government Acts/Rules/Notifications etc.

PENALTIES & PROSECUTION

[AY 2025-26]
Section Nature of default Penalty leviable
(1) (2) (3)
140A(3) Failure to pay wholly or partly— Such amount as Assessing Officer may
(a) self-assessment tax, or impose but not exceeding tax in arrears

(b) interest and fee, or

(c) both
under section 140A(1)
158BFA(2) Determination of undisclosed income of block Minimum : 100 per cent of tax leviable in
period respect of undisclosed income
Maximum : 300 per cent of tax leviable
in respect of undisclosed income.
221(1) Default in making payment of tax Such amount as Assessing Officer may
impose but not exceeding amount of tax
in arrears
234E Failure to file statement within time Rs. 200 for every day during which
prescribed in section 200(3) or in proviso to failure continues but not exceeding tax
section 206C(3) deductible/collectible
234F Default in furnishing return of income within Rs. 5,000 if return is furnished after due
time prescribed in section 139(1) date specified under section 139(1).
However if the total income of the person
does not exceed Rs. 5 lakhs then Rs.
1,000 shall be the late filing fees.
234G Fee for default in submission of Rs. 200 per day
statement/certificate prescribed under section
35/ Section 80G
234H Fee for default in intimating the Aadhaar a) Rs. 500, if such intimation is made
Number between 01-04-2022 and 30-06-2022;
and
b) Rs. 1,000, in all other cases.
270A(1) Under-reporting and misreporting of income A sum equal to 50% of the amount of tax
payable on under-reported income.
However, if under-reported income is in
consequence of any misreporting thereof
by any person, the penalty shall be equal
to 200% of the amount of tax payable on
under-reported income
271A Failure to keep, maintain, or retain books of Rs. 25,000
account, documents, etc., as required under
section 44AA
271AA(1) (1) Failure to keep and maintain information 2% of value of each international
and documents required by section 92D(1) or transaction/or specified domestic
92D(2) transaction entered into
(2) Failure to report such transaction
(3) Maintaining or furnishing incorrect
information or document
271AA(2) Failure to furnish information and document Rs. 5,00,000/-
as required under Section 92D(4)
271AAA Where search has been initiated before 1-7- 10% of undisclosed income
2012 and undisclosed income found
271AAB(1) Where search has been initiated on or after 1- (a) 10% of undisclosed income of the
7-2012 but before 15-12-2016 and specified previous year if assessee admits
undisclosed income found 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;
(c) 60% of undisclosed income of the
specified previous year if it is not covered
by (a) or (b) above
271AAB(1A) Where search has been initiated on or after (a) 30% of undisclosed income of the
15-12-2016 and undisclosed income found 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) 60% of undisclosed income of the
specified previous year in any other case.
271AAC Income determined by Assessing Officer or 10% of tax payable under section
the Commissioner (Appeals) includes any 115BBE.
income referred to in section 68, section 69,
section 69A, section 69B, section 69C or
section 69D for any previous year. [if such
 income is not included by assessee in his
return or tax in accordance with section
115BBE has not been paid]
271AAD 100% of such false entries or omitted
Penalty, if during any proceedings under the entry.
Act, it is found that in the books of accounts
maintained by assessee, there is:

a) A false entry; or
b) Any entry relevant for computation of
total income of such person has been
omitted to evade tax liability.
271AAE (a) For the first violation: to the extent
Penalty for violation of the provisions of 21st of income applied by the institution
proviso to section 10(23C) or section 13(1)(c) for the benefit of any interested
pertaining to passing of unreasonable benefits party referred to in section 13(3);
to trustees or specified person (b) For any violation in subsequent
years: twice the amount of such
income so applied (“double
penalty”).
271B Failure to get accounts audited or furnish a One-half per cent of total sales, turnover
report of audit as required under section or gross receipts, etc., or Rs. 1,50,000,
44AB which-ever is less
271BA Failure to furnish a report from an accountant Rs. 1,00,000
as required by section 92E
271BB Failure to subscribe any amount to units 20 per cent of such amount
issued under scheme referred to in section
88A(1)
271C Failure to deduct tax at source, wholly or Amount equal to tax not deducted or paid
partly, under sections 192 to 196D (Chapter
XVII-B) or failure to pay wholly or partly tax
u/s 115-O(2) or proviso to section 194B, or
failure to pay or ensure payment of tax as
required by 115-O(2), first proviso to section
194R(1), proviso to section 194S(1) or section
194BA(2).
271CA Failure to collect tax at source as required Amount equal to tax not collected
under Chapter XVII-BB
271D Taking or accepting any loan or deposit or Amount equal to loan or deposit or
specified sum in contravention of the specified sum so taken or accepted
provisions of Section 269SS.
"Specified sum" means any sum of money
receivable, whether as advance or otherwise,
in relation to transfer of an immovable
property, whether or not the transfer takes
place.
271DA Receiving an amount of Rs. 2 lakh or more Amount equal to such receipt
from a person in a day [section 269ST]
271DB Failure to provide facility for accepting Rs. 5,000 rupees for every day of default
payment through prescribed electronic modes
of payment as referred to in section 269SU
271E Repayment of any loan or deposit or specified Amount equal to loan or deposit or
advance otherwise than in accordance with specified advance so repaid
provision of Section 269T.
"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 transfer takes place.

271FA1 Failure to furnish an annual information Rs. 500 per day of default
return as required under section 285BA(1)2
Failure to furnish annual information return Rs. 1,000 per day of default
within the period specified in notice u/s
285BA(5)
271FAA Failure to furnish a statement under section Rs. 50,000
285BA or failure to furnish a correction
statement within the specified period or
failure to comply with the due diligence
requirement
Furnishing of inaccurate information by Rs, 5,000 for every inaccurate reportable
reporting financial institution and such account
inaccuracy is due to false or inaccurate
information submitted by the holder of
reportable accounts
271FAB Section 9A provides that fund management Rs. 5,00,000
activity carried out by an eligible offshore
investment fund through an eligible fund
manager acting on behalf of such fund shall
not constitute business connection in India
(subject to certain conditions).
The provision requires that eligible
investment fund shall furnish within 90 days
from the end of the financial year a statement,
in respect of its activities in a financial year,
in the prescribed form containing information
relating to fulfilment of specified conditions
and such other information or documents as
may be prescribed. Penalty to be levied if
investment fund failed to comply with the
requirement.

271G3 Failure to furnish any information or 2% of the value of the international

document as required by section 92D(3) transaction/specified domestic transaction
for each failure
271GA Section 285A provides for reporting by an Penalty shall be:
Indian concern if following two conditions are a) a sum equal to 2% of value of
satisfied: transaction in respect of which such
a) Shares or interest in a foreign company or failure has taken place, if such transaction
entity derive substantial value, directly or had effect of, directly or indirectly,
 indirectly, from assets located in India; and transferring right of management or
b) Such foreign company or entity holds such control in relation to the Indian concern;
assets in India through or in such Indian b) a sum of Rs. 5,00,00 in any other case.
concern.
In this case, the Indian entity shall furnish the
prescribed information for the purpose of
determination of any income accruing or
arising in India under Section 9(1)(i).
In case of any failure, the Indian concern shall
be liable to pay penalty.
271GB(1) Failure to furnish report under section 286(2) Rs. 5,000 per day upto 30 days and Rs.
15,000 per day beyond 30 days
271GB(2) Failure to produce the information and Rs. 5,000 for every day during which the
documents within the period allowed under failure continues.
section 271GB(6)
271GB(3) Failure to furnish report or failure to produce Rs. 50,000 for every day for which such
information/documents under section 286 failure continues beginning from the date
even after serving order under section of serving such order.
271GB(1) or 271GB(2)
271GB(4) Failure to inform about inaccuracy in report Rs. 5,00,000
furnish under section 286(2)
Or furnishing of inaccurate information or
document in response to notice issued under
section 286(6).
271GC Failure to submit statement under section 285 Rs. 1,000 per day of failure, up to 3
by a non-resident having liaison office in months; or
India (applicable with effect from April 1, Rs. 1,00,000 in any other case
2025)
271H4 Failure to deliver/cause to be delivered a W.e.f. 1-10-2014 Assessing Officer may
statement within the time prescribed in direct payment of penalty. Penalty shall
section 200(3) or the proviso to section not be less than Rs. 10,000 but may
206C(3), or furnishes incorrect information in extend to Rs. 1,00,000
the statement
271K Penalty of default in submission of Rs. 10,000 to Rs. 1 lakh
statement/certificate prescribed under section
35/Section 80G
271-I As per section 195(6) of the Act, any person Rs. 1,00,000
responsible for paying to a non-resident or to
a foreign company, any sum (whether or not
chargeable to tax), shall furnish the
information relating to such payment in Form
15CA and 15CB. Penalty shall be levied in
case of any failure.
271J Furnished incorrect information in any report Rs. 10,000 for each incorrect report or
or certificate by an accountant or a merchant certificate
banker or a registered valuer

272A(1) Refusal or failure to : Rs. 10,000 for each failure/default

 (a) answer questions
(b) sign statement
(c) attend to give evidence or produce books
of account, etc., in compliance with
summons under section 131(1)
(d) comply with notice u/s 142(1), 143(2)
or failure to comply with direction
issued u/s 142(2A).
272A(2) Failure to :
(a) furnish requisite information in respect Rs. 500 for every day during which the
of securities as required under section failure continues. (In respect of penalty
94(6) ; for failure, in relation to a declaration
mentioned in section 197A, a certificate
(b) give notice of discontinuance of business as required by section 203 and returns
or profession as required under section u/ss 206 and 206C and statements
176(3) ; under Section 200(2A) or section 200(3)
(c) furnish in due time returns, statements or or proviso to section 206C(3) or section
certificates, deliver de-claration, allow 206C(3A), penalty shall not exceed
inspection, etc., under sections 133, amount of tax deductible or collectible)
134, 139(4A), 139(4C), 192(2C), 197A,
203, 206, 206C, 206C(1A) and 285B;
(d) deduct and pay tax under section 226(2)
(e) file a copy of the prescribed statement
within the time specified in section
200(3) or the proviso to section 206C(3)
(up to 1-7-2012)
(f) file the prescribed statement within the
time specified in section 206A(1)
(g) Failure to deliver or cause to be
delivered a statement under Section
200(2A) or Section 206C(3A) within
prescribed time.
With effect from June 1, 2015, it is
mandatory for an office of the
Government, paying TDS or TCS, as
the case may be, without production of
a challan, to deliver a statement in the
prescribed form and manner to the
prescribed authority.
272AA(1) Failure to comply with section 133B Not exceeding Rs. 1,000
272B Failure to comply with provisions relating to Rs. 10,000 for each default
PAN or Aadhaar as referred to in section
139A/139A(5)(c)/(5A)/(5C)
272BB(1) Failure to comply with section 203A Rs. 10,000 for each failure/default
272BB(1A) Quoting false tax deduction account Rs. 10,000
 number/tax collection account number/tax
deduction and collection account number in
challans/certificates/statements/documents
referred to in section 203A(2)
Note : No penalty is imposable for any failure under sections 271(1)(b), 271A, 271AA, 271B, 271BA,
271BB, 271C, 271CA, 271D, 271E, 271F, 271FA, 271FAB, 271FB, 271G, 271GA, 271GB, 271H, 271-I,
272A(1)(c) or (d), 272A(2), 272AA(1), 272B, 272BB(1), 272BB(1A), 272BBB(1), 273(1)(b), 273(2)(b)
and 273(2)(c) if the person or assessee proves that there was reasonable cause for such failure (section
273B).
Section 273AA provides that a person may make application to the Principal
Commissioner/Commissioner for granting immunity from penalty, if (a) he has made an application for
settlement under section 245C and the proceedings for settlement have abated; and (b) penalty proceeding
have been initiated under this Act. The application shall not be made after the imposition of penalty after
abatement.
OFFENCES AND PROSECUTIONS
Section Nature of default Punishment Fine
(rigorous
imprisonment)
(1) (2) (3) (4)
275A Contravention of order made under section 132(1) (Second Up to 2 years No
Proviso) or 132(3) in case of search and seizure limit
275B Failure to afford necessary facility to authorised officer to inspect Up to 2 years No
books of account or other documents as required under section limit
132(1)(iib)
276 Removal, concealment, transfer or delivery of property to thwart Up to 2 years No
tax recovery limit
276A Failure to comply with provisions of section 178(1) and (3) re : 6 months to 2 —
company in liquidation years
276B Failure to pay to credit of Central Government (i) tax deducted at 3 months to 7 No
source under Chapter XVII-B (non-cognizable offence under years limit
section 279A), or proviso to section 194B, or failure to pay or
ensure payment of tax as required by section 115O(2), first
proviso to section 194R(1), proviso to section 194S(1) or section
194BA(2).
Note: The provision of this section shall not apply if payment in
respect to TDS has been made to the credit of the Central
Government at any time on or before the time prescribed for filing
the TDS statement in respect to such payment. (applicable w.e.f
01-10-2024)
276BB Failure to pay the tax collected under the provisions of section 3 months to 7 No
206C years limit
276C(1) Wilful attempt to evade tax, penalty or interest or under-reporting
of Income (non-cognizable offence under section 279A)—
(a) where tax sought to be evaded exceeds Rs. 1 lakh (Rs. 25 6 months to 7 No
lakh w.e.f. 1-7-2012) years limit
(b) in other cases 3 months to 3 No
years (2 years limit
w.e.f. 1-7-2012)
276C(2) Wilful attempt to evade payment of any tax, penalty or interest 3 months to 3 No
(non-cognizable offence under section 279A) years (2 years limit
w.e.f. 1-7-2012)
276CC Wilful failure to furnish returns of fringe benefits under section
115WD/115WH or return of income under section 139(1) or
under section 139(8A) or in response to notice under section
142(1)(i) or section 148 or section 153A (non-cognizable offence
under section 279A)—
(a) where tax sought to be evaded exceeds Rs. 1 lakh (Rs. 25 6 months to 7 No
lakh w.e.f. 1-7-2012) years limit
(b) in other cases 3 months to 3 No
Note : *** A person shall not be liable to be prosecuted under this years (2 years limit
section if he furnishes the return before expiry of assessment year w.e.f. 1-7-2012)
or the tax payable by such person, not being a company, as
reduced by the advance tax self-assessment tax paid before expiry
of the assessment year, TDS and TCS, does not exceed Rs.
10,000.
276CCC Wilful failure to furnish in due time return of total income 3 months to 3 No
required to be furnished by notice u/s 158BC(1)(a) years limit
276D6 Wilful failure to produce accounts and documents under section Up to 1 year 7Rs. 4
142(1) or to comply with a notice under section 142(2A) to Rs.
10 for
every
day of
default
277 False statement in verification or delivery of false account, etc.
(non-cognizable offence under section 279A)
(a) where tax sought to be evaded exceeds Rs. 1 lakh (Rs. 25 6 months to 7 No
lakh w.e.f. 1-7-2012) years limit
(b) in other cases 3 months to 3 No
years (2 years limit
w.e.f. 1-7-2012)
277A Falsification of books of account or document, etc., to enable any 3 months to 3 No
other person to evade any tax, penalty or interest years (2 years limit
chargeable/leviable under the Act w.e.f. 1-7-2012)
278 Abetment of false return, account, statement or declaration
relating to any income or fringe benefits chargeable to tax (non-
cognizable offence under section 279A)
(a) where tax, penalty or interest sought to be evaded exceeds 6 months to 7 No
Rs. 1 lakh (Rs. 25 lakh w.e.f. 1-7-2012) years limit
(b) in other cases 3 months to 3 No
years (2 years limit
w.e.f. 1-7-2012)
278A Second and subsequent offences under sections 276B, 276BB, 6 months to 7 No
276C(1), 276CC, 276DD, 276E, 277 or 278 years limit
280(1) Disclosure of particulars by public servants in contravention of Up to 6 months No
 section 138(2) [Prosecution to be instituted with previous sanction (simple/rigorous) limit
of Central Government under section 280(2)]
Notes :
1. No person is punishable for any failure under section 276A, 276AB or 276B if he proves that there was
reasonable cause for such failure (vide section 278AA).
2. (a) Prosecution for offences under section 275A, section 275B, section 276, section 276A, section
276B, section 276BB, section 276C, section 276CC, section 276D, section 277, section 277A and section
278 to be instituted with previous sanction of Principal Director General/Principal Chief
Commissioner/Principal Commissioner/Director General/Chief Commissioner/Commissioner, except
where prosecution is at the instance of the Commissioner (Appeals) or the appropriate authority (vide
section 279).
(b) The offences under Chapter XXII can be compounded (either before or after the institution of
proceedings) by Principal Director General/Director General or Principal Chief Commissioner/Chief
Commissioner.
3. Where an offence under this Act has been committed by a person, being a company, and the
punishment for such offence is imprisonment and fine, then, such company shall be punished with fine
and every person, referred to in sub-section (1) of section 278B, or the director, manager, secretary or
other officer of the company referred to in sub-section (2) of section 278B shall be liable to be proceeded
against and punished in accordance with the provisions of this Act.
4. With effect from 1-4-2008 under section 278AB a person may apply to the Principal
Commissioner/Commissioner for granting immunity from prosecution, if he has applied for settlement
under section 245C and the proceedings have abated under section 245HA. The application shall not be
made after institution of prosecution proceedings after abatement.

1. With effect from assessment year 2015-16 "annual information return" has been changed to "statement
of financial transaction or reportable account" and word "return" has been changed to "statement".
2. With effect from assessment year 2015-16 a new section 271FAA has been inserted to provide for a
penalty of Rs. 50,000 for furnishing inaccurate statement of financial transaction or reportable account in
certain cases.
3. With effect from 1-10-2014 TPO can also levy penalty.
4. Section 271H as amended with effect from 1-10-2014 provides that penalty shall be levied by
Assessing Officer.
5. Non-operative with effect from 1-7-2002.
6. With effect from October 1, 2014, if a person wilfully fails to produce accounts and documents as stated
or wilfully fails to comply with the direction given, he shall be punishable with rigorous imprisonment for
a term which may extend to one year and with fine (quantum of fine has not been specified).
7. No limit w.e.f. 1-10-2014.

[As Amended by Finance (No. 2) Act, 2024]