TaxTMI 
TaxTMI 
Comparison of section 465 "Penalty for failure to answer questions, sign statements, furnish information, returns or statements, allow inspections, etc." between the Income-Tax Act, 2025 (as passed) and the Income-Tax Bill, 2025 (as originally introduced)
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....ures such as refusal to answer questions, failure to sign statements, omission to produce documents, and defaults in furnishing returns or allowing inspections. It matters because it prescribes monetary sanctions and administrative authorities for enforcement, affecting taxpayers, withholding agents and income-tax authorities. Effective date or enactment timing: Not stated in the document. Background & Scope Statutory hook: Clause 465 of the Income Tax Bill, 2025 (Old Version). The Clause falls under the chapter titled "PENALTIES" within the Bill. Coverage: penal consequences for (1) discrete defaults attracting a fixed penalty and (2) continuing failures attracting a daily penalty. The text lists specific sections (e.g., 175(7), 246(1), ....
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.... section 393(6); failure to furnish a certificate u/s 395(4); failure to deduct and pay tax u/s 416(3); failure to furnish a statement u/s 389(5)(a); failure to deliver a copy of the declaration referred to in section 394(2); and failures relating to statements u/s 397(3)(g) or 397(3)(e) as specified. Sub-section (3) caps the penalty amounts for certain failures, providing that the penalty shall not exceed the amount of tax deductible or collectible for failures concerning (a) declaration mentioned in section 393(6); (b) certificate u/s 395(4); and (c) statements u/s 397(3)(b) or (e). Sub-section (4) allocates authority to impose penalties under sub-sections (1) and (2): where the contravention occurs in a proceeding before an income-tax ....
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....sent except the cap in sub-section (3), which functions as a monetary limitation for specified failures. There are no express exceptions for reasonable cause, waiver, or mitigation in the Clause. The Clause does not state any appeal route, remission power, or reconciliation mechanism within its text. Not stated in the document: any criteria for determining when a refusal is justified or procedural safeguards prior to imposition. Illustrations * Example 1: A taxpayer refuses to answer questions in an assessment proceeding when legally bound to state the truth. Under sub-section (1)(a) the taxpayer is liable to a penalty of Rs.10,000 for that default. * Example 2: An employer delays furnishing a statement u/s 397(3)(e); for each day of d....
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.... of default. * Record-keeping/evidence points: Because refusals, omissions and delays are actionable, taxpayers and agents should retain contemporaneous records showing service/compliance (dates of furnishing returns, copies of declarations delivered, proof of production of documents, correspondence responding to notices). Not stated in the document: any prescribed forms, notices or proof standards for contesting penalty imposition. Key Takeaways * Clause 465 prescribes a Rs.10,000 fixed penalty for specific discrete defaults including refusal to answer, refusal to sign, failure to attend/produce documents and non-compliance with certain notices or directions. * A continuing penalty of Rs.500 per day applies to a defined list of dela....
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....ation cross-reference Refers to "copy of the declaration referred to in section 394(2)". Refers to "copy of the declaration required u/s 394(3)". Sub-section (2)(k)-(m) - statement timing references Contains items (k) "within the time specified in section 397(3)(g)" and (l) "time as prescribed u/s 397(3)(e)". No item (m). Contains items (k) "within the time specified in section 397(3)(b)" and (l) "within the time as may be prescribed u/s 397(3)(e)" and (m) "within the time as may be prescribed u/s 397(3)(g)(i)". Sub-section (3) - referenced clauses for cap Caps related to declaration in section 393(6); certificate under section 395(4); statements under section 397(3)(b) or (e). Caps related to declaration required u/s 393(7)....