Comparison of section 452 "Penalty for failure to comply with provisions of section 187." between the Income-Tax Act, 2025 (as passed) and the Income-Tax Bill, 2025 (as originally introduced)

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....s "good and sufficient reason" for the failure. It matters because it regulates enforcement and potential penalties on persons required to enable electronic payment acceptance; affected parties include taxpayers, merchants, and persons obligated u/s 187. Effective date or decision date: Not stated in the document. Background & Scope Statutory hooks: Clause 452 is part of the Income Tax Bill, 2025 and refers specifically to compliance with clause/section 187. The provision is located in the penalties chapter (PENALTIES) of the Bill. It covers a person's failure to provide a facility for accepting payments through the prescribed electronic modes of payment (as referred to in section 187). Definitions or further explanations of "person,"....

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....ry explanation and proof, suggesting a balancing of deterrence with fairness in deserving circumstances. No legislative history or explanatory memorandum is included in the document; therefore, further intentions or parliamentary debates are Not stated in the document. Exceptions/Provisos The clause contains a single proviso: the penalty does not apply "except when he proves that there were good and sufficient reason for such failure." The clause does not define what constitutes "good and sufficient reason," nor does it prescribe standards of proof, the quantum of evidence required, or the timeline and mode by which such proof must be presented. Those procedural or substantive criteria are Not stated in the document. Illustrations * Ex....

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....ception-"except when he proves that there were good and sufficient reason for such failure." The enacted Section 452 omits this exception and contains no proviso permitting the person to avoid penalty by showing cause. * Resulting practical impact: * Burden of avoidance: Under the Bill's text, a person subject to penalty has an explicit statutory pathway to escape penalty by proving "good and sufficient reason." The enacted provision removes that explicit pathway, exposing persons to a strict daily penalty without a statutory exception, increasing compliance risk and potential litigation over fairness and interpretation. * Enforcement discretion: The Bill's proviso suggests a fact-sensitive inquiry and potential mitigation; it....

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....rts, maintenance schedules, vendor communications, and contemporaneous notices to customers; the clause itself does not enumerate any specific documents or procedural steps. Timelines for presenting such proof are Not stated in the document. Key Takeaways * Clause 452 imposes a daily penalty of Rs.5,000 for failure to provide facilities to accept payments via prescribed electronic modes u/s 187. * The Bill explicitly permits avoidance of the penalty where the person proves "good and sufficient reason" for the failure. * The clause does not define "good and sufficient reason," nor does it set procedural rules for proving such a reason; those details are Not stated in the document. * The provision creates a strong financial incentive....