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<h1>Penalty under Section 271AAB: lower rates for admission or timely declaration and tax payment; higher rate for noncompliance.</h1> Under Section 271AAB(1) three penalty rates apply to undisclosed income for the specified previous year: a reduced rate where the assessee admits the income, substantiates its source, pays tax with interest and files the return by the specified date; an intermediate rate where the assessee does not admit but declares the income and pays tax with interest by the specified date; and a highest rate where neither condition is met.