Under the Income Tax Act, if an assessee commits an offence, he shall be subject to a penalty. This is an amount which shall be charged and levied from the assessee over and above the payable tax. And it shall be levied based on the law in force during the time at which the offence was committed. The list of penalties has been provided below:
| SL. NO. | SECTION | PENALTY |
| 1 | Section 158BFA: It deals with the determination of undeclared income for a block period when a search is initiated under section 132 of the Income Tax Act, or books of account, other documents, or any assets are requisitioned under section 132A of the Income Tax Act in the case of any person |
The minimum penalty is 100% of the tax leviable in respect of the undisclosed income Maximum penalty would be 300% of the tax leviable in respect of the undisclosed income.The above penalty shall be charged only on the income determined by the ITO in excess of the income as per the ITR furnished by the assessee u/s 158BC and appeal is not filed against such assessment. |
| 2 | Section 221(1): Default in making payment of taxes to the Income Tax Authority |
The penalty amount shall be as directed by the assessing officer. However, the amount of penalty charged should not or cannot exceed the amount of tax in arrears as per the Act and its provisions (Income Tax Act). |
| 3 | Section 234E: Failure to file the return by the assessee concerning the collection or deduction of TDS or TCS within the time prescribed as given under section 200(3) or 206C (3) |
INR 200 for every day of default (continuing) |
| 4 | Section 234F: Default in furnishing of return under section 139(1) within the time which is specified by the Income Tax Act |
INR 5,000 if the return is furnished before the 31st of December of the relevant assessment year.
INR 10,000 shall be leviable in any other case. Note: In case the income earned or declared here does not exceed INR 5 Lakhs, then the penalty also shall not exceed INR 1,000 for the assessment year. |
| 5 | Section 270A: Penalty charged for under-reporting or the reporting of income lower than the earned or made income. Penalty for under-reporting of income earned on account of misreporting of income. |
50% of the amount of tax shall be payable on the under-reported income by such assessee.
200% of the amount shall be payable as tax (this shall be on the amount of underreported income). |
| 6 | Section 271(1)(b): Failure to declare income and file returns and comply with noticesNote: Applicable up to AY 2016-17 |
INR 10,000 for every failure |
| 7 | Section 271(1)(c): Concealment of the particulars of his income earned or fringe benefits earned or furnished wrong particulars of such income or fringe benefits to the department of Income TaxNote: Applicable up to AY 2016-17 |
Minimum: 100% of tax seeks to be evaded.
Maximum: 300% of tax sought to be eluded. |
| 8 | Section 271(1)(4): Distribution of profits by a registered firm that is found to be not by the partnership deed, and thereby a partner disclosed or returned his income below the real amount: Applicable up to AY 2016-17 |
Maximum 150% of the tax |
| 9 | Section 271A: Failure to keep, maintain, or retain the books of account documents as required under Section 44AA |
INR 25,000 |
| 10 | Section 271AA (1): Penalty arising concerning an international transaction or a particularly prescribed domestic transaction: -failure to keep and maintain any such information and document which is mandated by the provisions of Section 92D (1) or 92D (2) – the failure to report an important transaction that was to be furnished -Maintaining or providing the wrong information or document related to it. |
2% of the value of the international transaction or specified domestic transaction entered into shall be charged. |
| 11 | Section 271AA (2): Dealing with any failure to furnish or provide information, and also any allied documents to the authority prescribed as required under Section 92D (4) |
INR 5 Lakhs |
| 12 | Section 271AAA (1): Deals with the search which has been initiated under Section 132 of the Income Tax Act between the dates of 1st of June 2007 and 1st of July 2012 |
10% of the undeclared income of the relevant previous year. |
| 13 | Section 271AAA (2): Nothing contained in sub-section (1) shall apply. |
If the person in question agrees on the undeclared income and specifies how such income has been earned, and then also provides supporting how the undisclosed income was derived, the tax, together with interest, if any, in respect of the undisclosed income earned by the assessee during a previous year. No penalty under the provisions of clause (c) of sub-section (1) of section 271 of the Income Tax shall be charged. |
| 14 | Section 271AAB (1): Where search has been initiated between the 1st of July 2012 and the 15th of December 2016. |
a) At the rate of 10% of the undeclared income earned if:
-Assessee admits the earning of the undisclosed income along with the manner of earning the same. b) At the rate of 20% of the undeclared income if: c) If not covered under clause (a) or (b) above, then the penalty shall be charged at the rate of 60% of the undeclared income of the specified previous year. |
| 15 | Section 271AAB(1A): Where search has been initiated after the date of 15th December 2016 |
a) At the rate of 30% of the undisclosed income now being targeted, if: -Assessee is admitting the undisclosed income and also specifies or agrees on how it was derived -Supports how the undisclosed income was derived by the person -Pays the tax with interest and also furnishes the ITR for the relevant previous year, declaring an undisclosed income on or before the date specified. b) A rate of 60% of the undeclared income shall be charged if it is not covered under the provisions of clause (a). |
| 16 | Section 271AAC: Income under sections 68, 69, 69A,69B,69C, and 69D determined by the assessing officer if not included by the assessee or the tax under Section 115BBE has not been paid*Section 68- Cash Credits Section 69- Unexplained Investments Section 69A- Unexplained money Section 69 B-69 B- The amount of investments not fully disclosed in the books of account Section 69C-Unexplained expenditure |
At the rate of 10% on tax, which is payable under Section 115BBE. |
| 17 | Section 271AAD: Penalty for false entry, fake invoices, etc., in the books of account |
If any assessing officer or the AO finds that: a) A false entry, or b) There was an omission of any entry which is considered to be relevant for computation of the total income of an assessee, then he may direct the assessee to pay a penalty of an amount which is equal to the sum of such false or omitted entries. The false entry here means the following: a) Forged or false document, which might be in the form of a sales invoice that is not real b) Any invoice of supply or receipts of goods or services issued by any person while there was no actual supply or receipt of goods or services taking place c) An invoice which was issued or received in respect of the supply or receipt of goods or services or both to or from a person who does not exist |
