TaxTMI 
TaxTMI 
Failure to furnish returns, comply with notices, concealment of income, etc
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....the cases referred to in clause (b), ^15[in addition to tax, if any, payable] by him, ^16[a sum of ten thousand rupees] for each such failure;] ^17[(iii) in the cases referred to in clause (c) ^18[or clause (d)], ^19[in addition to tax, if any, payable] by him, a sum which shall not be less than, but which shall not exceed ^20[three times], the amount of tax sought to be evaded by reason of the concealment of particulars of his income ^21[or fringe benefits] or the furnishing of inaccurate particulars of such income ^22[or fringe benefits]. ^23[****]] ^24[Explanation 1.-Where in respect of any facts material to the computation of the total income of any person under this Act,- (A) such person fails to offer an explanation or offers an explanation which is found by the ^25[Assessing] Officer or ^57[the Joint Commissioner (Appeals) or the Commissioner (Appeals)] ^28[or the ^54A[Principal Commissioner or] Commissioner] to be false, or (B) such person offers an explanation which he is not able to substantiate ^29[and fails to prove that such explanation is bona fide and that all the facts relating to the same and material to the computat....
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....of sub-section (1) of section 142 or section 148 and the Assessing Officer or ^57[the Joint Commissioner (Appeals) or the Commissioner (Appeals)] is satisfied that in respect of such assessment year such person has taxable income, then, such person shall, for the purposes of clause (c) of this sub-section, be deemed to have concealed the particulars of his income in respect of such assessment year, notwithstanding that such person furnishes a return of his income at any time after the expiry of the period aforesaid in pursuance of a notice under section 148.] ^55[Explanation 4.- For the purposes of clause (iii) of this sub-section,- (a) the amount of tax sought to be evaded shall be determined in accordance with the following formula- (A - B) + (C - D) where, A = amount of tax on the total income assessed as per the provisions other than the provisions contained in section 115JB or section 115JC (herein called general provisions); B = amount of tax that would have been chargeable had the total income assessed as per the general provisions been reduced by the amount of income in respect of which particulars have been concealed or inacc....
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.... which has ended before the date of the search, but the return of income for such year has not been furnished before the said date or, where such return has been furnished before the said date, such income has not been declared therein ; or (b) for any previous year which is to end on or after the date of the search, then, notwithstanding that such income is declared by him in any return of income furnished on or after the date of the search, he shall, for the purposes of imposition of a penalty under clause (c) of sub-section (1) of this section, be deemed to have concealed the particulars of his income or furnished inaccurate particulars of such income, ^38[unless,- (1) such income is, or the transactions resulting in such income are recorded,- (i) in a case falling under clause (a), before the date of the search ; and (ii) in a case falling under clause (b), on or before such date, in the books of account, if any, maintained by him for any source of income or such income is otherwise disclosed to the ^39[^54B[Principal Chief Commissioner or] Chief Commissioner or ^54C[Principal Commissioner or] Commissioner] before the said date ; ....
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....ined in section 92B, any amount is added or disallowed in computing the total income under sub-section (4) of section 92C, then, the amount so added or disallowed shall, for the purposes of clause (c) of this sub-section, be deemed to represent the income in respect of which particulars have been concealed or inaccurate particulars have been furnished, unless the assessee proves to the satisfaction of the Assessing Officer or ^57[the Joint Commissioner (Appeals) or the Commissioner (Appeals)] ^44[or the ^54D[Principal Commissioner or] Commissioner] that the price charged or paid in such transaction was computed in accordance with the provisions contained in section 92C and in the manner prescribed under that section, in good faith and with due diligence.] ^45[(1A) Where any penalty is imposable by virtue of Explanation 2 to sub-section (1), proceedings for the imposition of such penalty may be initiated notwithstanding that any proceedings under this Act in the course of which such penalty proceedings could have been initiated under sub-section (1) have been completed.] ^52[(1B) Where any amount is added or disallowed in computing the total income or loss of an assessee in an....
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....s section shall not apply to and in relation to any assessment for the assessment year commencing on or after the 1st day of April, 2017.] ************* NOTES:- 1. Restored vide Section 95 of the Direct Tax Laws (Amendment) Act, 1989 w.e.f. 01-04-1989 before it was read as, "271. Failure to comply with notices. If the Assessing Officer, in the course of any proceedings under this Act, is satisfied that any person has failed to comply with a notice under sub-section (1) of section 142 or sub-section (2) of section 143 or with a direction issued under sub-section (2A) of section 142, the Assessing Officer may direct that such person shall pay, by way of penalty, a sum which shall not be less than one thousand rupees but which may extend to twenty-five thousand rupees for each such failure." Earlier, Substituted vide Section 106 of the Direct Tax Laws (Amendment) Act, 1987 w.e.f. 01-04-1989 before it was read as, "Failure to furnish returns, comply with notices, concealment of income, etc. 271. (1) If the Assessing Officer or the Deputy Commissioner (Appeals) or the Commiss....
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....ling under clause (c), the amount of income (as determined by the Assessing Officer on assessment) in respect of which the particulars have been concealed or inaccurate particulars have been furnished exceeds a sum of twenty-five thousand rupees, the Assessing Officer shall not issue any direction for payment by way of penalty without the previous approval of the Deputy Commissioner. Explanation 1 : Where in respect of any facts material to the computation of the total income of any person under this Act,- (A) such person fails to offer an explanation or offers an explanation which is found by the Assessing Officer or the Deputy Commissioner (Appeals) or the Commissioner (Appeals) to be false, or (B) such person offers an explanation which he is not able to substantiate and fails to prove that such explanation is bona fide and that all the facts relating to the same and material to the computation of his total income have been disclosed by him, then, the amount added or disallowed in computing the total income of such person as a result thereof shall, for the purposes of clause (c) of this sub-section, be deemed to represent the income in respect....
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....is satisfied that in respect of such assessment year such person has taxable income, then, such person shall, for the purposes of clause (c) of this sub-section, be deemed to have concealed the particulars of his income in respect of such assessment year, notwithstanding that such person furnishes a return of his income at any time after the expiry of the period aforesaid in pursuance of a notice under section 148. Explanation 4 : For the purposes of clause (iii) of this sub-section, the expression "the amount of tax sought to be evaded",- (a) in any case where the amount of income in respect of which particulars have been concealed or inaccurate particulars have been furnished exceeds the total income assessed, means the tax that would have been chargeable on the income in respect of which particulars have been concealed or inaccurate particulars have been furnished had such income been the total income; (b) in any case to which Explanation 3 applies, means the tax on the total income assessed; (c) in any other case, means the difference between the tax on the total income assessed and the tax that would have been chargeable had such total incom....
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....otwithstanding that any proceedings under this Act in the course of which such penalty proceedings could have been initiated under sub-section (1) have been completed. (2) When the person liable to penalty is a registered firm or an unregistered firm which has been assessed under clause (b) of section 183, then notwithstanding anything contained in the other provisions of this Act, the penalty imposable under sub-section (1) shall be the same amount as would be imposable on that firm if that firm were an unregistered firm. (3) Notwithstanding anything contained in this section,- (a) no penalty for failure to furnish the return of his total income under sub-section (1) of section 139 shall be imposed under sub-section (1) on an assessee whose total income does not exceed the maximum amount not chargeable to tax in his case by one thousand five hundred rupees ; (b) where a person has failed to comply with a notice under sub-section (2) of section 139 or section 148 and proves that he has no income liable to tax, the penalty imposable under sub-section (1) shall not exceed twenty-five rupees; (c) no penalty shall be imposed under sub-sectio....
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.... "(a) has failed to furnish the return of total income which he was required to furnish under sub-section (1) of section 139 or by notice given under sub-section (2) of section 139 or section 148 or has failed to furnish it within the time allowed and in the manner required by sub-section (1) of section 139 or by such notice as the case may be, or" Earlier, Amended vide Section 17 of the Finance Act, 1963 w.e.f. 28-04-1963 And was Amended vide Section 19 of the Taxation Laws (Amendment & Miscellaneous Provisions) Act, 1986 w.e.f. 10-09-1986 7. Omitted vide Section 19 of the Taxation Laws (Amendment & Miscellaneous Provisions) Act, 1986 w.e.f. 10-09-1986 before it was read as, "without reasonable cause" 8. Inserted vide Section 58 of the Finance Act, 2005 w.e.f. 01-04-2006 9. Inserted vide Section 61 of the Taxation Laws (Amendment) Act, 1975 w.e.f. 01-04-1976 10. Omitted vide Section 40 of the Finance Act, 1964 w.e.f. 01-04-1964 before it was read as, "deliberately" 11. Substituted vide Section 58 of the Finance Act, 2005 w.e.f. 01-04-2006 before it was read as, "income," 12. I....
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....shall not exceed fifty per cent of the amount of the tax, if any, which would have been avoided if the income returned by such person had been accepted as the correct income;" 15. Substituted vide Section 101 of the Finance Act, 2002 w.e.f. 01-04-2003 before it was read as, "in addition to any tax payable" 16. Substituted vide Section 86 of the Finance Act, 2001 w.e.f. 01-06-2001 before it was read as, "a sum which shall not be less than one thousand rupees but which may extend to twenty-five thousand rupees" 17. Substituted vide Section 61 of the Taxation Laws (Amendment) Act, 1975 w.e.f. 01-04-1976 before it was read as, "(iii) in the cases referred to in clause (c), in addition to any tax payable by him, a sum which shall not be less than, but which shall not exceed twice, the amount of the income in respect of which the particulars have been concealed or inaccurate particulars have been furnished." Earlier, Substituted vide Section 19 of the Finance Act, 1968 w.e.f. 01-04-1968 before it was read as, "(iii) in the cases referred to in clause (c), in addition to any tax payab....
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.... (Amendment) Act, 1987 w.e.f. 01-04-1988 before it was read as, "Income-tax" 26. Omitted vide Section 65 of the Finance (No. 2) Act, 1998 w.e.f. 01-10-1998 before it was read as, "Deputy Commissioner (Appeals) or the" Earlier, "or the" was Inserted vide Fifth Schedule of the Finance (No. 2) Act, 1977 w.e.f. 10-07-1978 And was Substituted vide Section 2 of the Direct Tax Laws (Amendment) Act, 1987 w.e.f. 01-04-1988 before it was read as, "Appellate Assistant Commissioner" 27. Inserted vide Fifth Schedule of the Finance (No. 2) Act, 1977 w.e.f. 10-07-1978 28. Inserted vide Section 101 of the Finance Act, 2002 w.e.f. 01-06-2002 29. Inserted vide Section 19 of the Taxation Laws (Amendment & Miscellaneous Provisions) Act, 1986 w.e.f. 10-09-1986 30. Omitted vide Section 19 of the Taxation Laws (Amendment & Miscellaneous Provisions) Act, 1986 w.e.f. 10-09-1986 before it was read as, "Provided that nothing contained in this Explanation shall apply to a case referred to in clause (B ) in respect of any amount added or disallowed as a result of the rejection of any explanation o....
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....7 w.e.f. 01-04-2003 36. Inserted vide Section 48 of the Taxation Laws (Amendment) Act, 1984 w.e.f. 01-10-1984 37. Substituted vide Section 76 of the Finance Act, 2007 w.e.f. 01-06-2007 before it was read as, "search under section 132" 38. Substituted vide Section 19 of the Taxation Laws (Amendment & Miscellaneous Provisions) Act, 1986 w.e.f. 10-09-1986 before it was read as, "unless such income is, or the transactions resulting in such income are, recorded- (i) in a case falling under clause (a ), before the date of the search ; and (ii) in a case falling under clause ( b ), on or before such date, in the books of account, if any, maintained by him for any source of income or such income is otherwise disclosed to the Commissioner before the said date." 39. Substituted vide Section 2 of the Direct Tax Laws (Amendment) Act, 1987 w.e.f. 01-04-1988 before it was read as, "Commissioner" 40. Omitted vide Section 50 of the Direct Tax Laws (Amendment) Act, 1989 w.e.f. 01-04-1989 before it was read as, "clause (a) or clause (b) of" 41. Substituted vide Sect....
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....no income liable to tax, the penalty imposable under sub-section (1) shall not exceed twenty-five rupees; (c) no penalty shall be imposed under sub-section (1) upon any person assessable under clause (i) of sub-section (1) of section 160, read with section 161, as the agent of a non-resident for failure to furnish the return under sub-section (1) of section 139; (d) the penalty imposed under clause (i) of sub-section (1) and the penalty imposed under clause (iii) of that sub-section, read with Explanation 3 thereto, shall not exceed in the aggregate twice the amount of the tax sought to be evaded: Provided that nothing contained in clause (a) or clause (b) shall apply to a case referred to in sub-clause (a) of clause (i) of sub-section (1)." Earlier, Amended vide Section 61 of the Taxation Laws (Amendment) Act, 1975 w.e.f. 01-04-1976 46A. Omitted vide Section 61 of the Taxation Laws (Amendment) Act, 1975 w.e.f. 01-04-1976 before it was read as, "(4A) Notwithstanding anything contained in clause (i) or clause (iii) of sub-section (1) the Commissioner may, in his discretion- (i) reduce or waive the amo....
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....n Laws (Amendment) Act, 1970 w.e.f. 01-04-1971 47. Substituted vide Section 2 of the Direct Tax Laws (Amendment) Act, 1987 w.e.f. 01-04-1988 before it was read as, "Income-tax" 48. Omitted vide Section 65 of the Finance (No. 2) Act, 1998 w.e.f. 01-10-1998 before it was read as, "Deputy Commissioner (Appeals) or the" Earlier, "or the" was Inserted vide Fifth Schedule of the Finance (No. 2) Act, 1977 w.e.f. 10-07-1978 And was Substituted vide Section 2 of the Direct Tax Laws (Amendment) Act, 1987 w.e.f. 01-04-1988 before it was read as, "Appellate Assistant Commissioner" 49. Inserted vide Fifth Schedule of the Finance (No. 2) Act, 1977 w.e.f. 10-07-1978 50. Inserted vide Section 50 of the Direct Tax Laws (Amendment) Act, 1989 w.e.f. 01-04-1989 51. Inserted vide Section 58 of the Finance Act, 2005 w.e.f. 01-04-2006 52. Inserted vide Section 52 of the Finance Act, 2008 w.e.f. 01-04-1989 53. Substituted vide Section 97 of the Finance Act, 2012 w.e.f. 01-04-2013 before it was read as, "international transaction" 54. Inserted vide Section 4 of the Finance (No. 2) A....