Penalty and Prosecution for failure to deduct tax at source [ Section 271C and section 276B]

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.... is triggered in two principal scenarios: • Failure to Deduct TDS: Where a person fails to deduct the whole or any part of the tax as required by or under the provisions of Chapter XVII-B. • Failure to Pay or Ensure Payment of Tax: Where a person fails to pay or ensure payment of tax as required by or under certain specified provisions (e.g., Section 115O(2), Section 194B proviso, Section 194R, Section 194S, and Section 194BA). Penalty under Section 271C shall be imposed for the following defaults: a. Failure to Deduct TDS [Clause (a) of section 271C(1) ] Deduct the whole or any part of the tax as required by or under the provisions of Chapter XVII-B (i.e. Section 192 to 206B); or ....

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....s are wholly or partly in kind) • Section 194BA: Failure to ensure payment of tax in respect of the winnings from online game in kind, whether wholly or partly, where cash part is not sufficient to meet the liability for deduction of tax in respect of whole winnings from online games as referred to in Section 194BA(2); (i.e. TDS on winnings from online games) • Section 194R:- Failure to ensure payment of tax in respect of the benefit or perquisite in kind, whether wholly or partly, where cash part is not sufficient to meet the liability for deduction of tax in respect of whole of such benefit or perquisite as referred to in first proviso to Section 194R(1); (i.e. dealing with TDS on benefit....

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....I-B; or (b) pay tax or ensure payment of tax to the credit of the Central Government, as required by or under the proviso to section 194S(1) or section 194BA(2) he shall be punishable-- (i) with simple imprisonment for a term up to two years, or with fine, or with both, where the amount of such tax exceeds fifty lakh rupees; or (ii) with simple imprisonment for a term up to six months, or with fine, or with both, where the amount of such tax exceeds ten lakh rupees but does not exceed fifty lakh rupees; or (iii) with fine, in any other case: Provided that the provisions of this section shall not apply, if the payment referred to in clause (a) has been made to the credit of....