The document summarizes various penalty provisions under the Income Tax Act of India. It outlines penalties for failure to pay tax, comply with notices, maintain books of accounts, get accounts audited, deduct or collect tax at source, furnish returns, and answer questions. It also discusses the power of tax authorities to reduce or waive penalties in cases of voluntary disclosure, cooperation and hardship. Procedures for imposing penalties require approval from higher authorities for penalties over certain amounts.

1. Other Penalties
By
Shankar Bose
Inspector of Income-tax
MSTU, Puri

2. Sec.221:Penalty payable when tax in default.
 When the assessee is in default in payment of tax, he shall be liable to penalty as the A.O. may
from time to time direct to pay but total penalty not to exceed the amount of tax in arrears.
 Reasonable opportunity must be given.
 No penalty for good and sufficient reasons.
 Expl. The assessee shall not cease to be liable for penalty merely for reason that he paid the
tax before levy of penalty.
 Where the tax, in respect of which penalty was levied, is wholly reduced, penalty levied shall
be cancelled and the amount of penalty paid shall be refunded.
Sec.271(1)(b): Failure to comply with notices u/s 142(1) 142(2A) 143(2).
If any person fails to comply with notices u/s 142(1) or 143(2) or with a direction u/s 142(2A) ,he shall
be liable to pay penalty of Rs. 10000 for each failure.
Sec.271A: Failure to keep or maintain books of a/cs.
If any person fails to keep or maintain books of a/cs and other documents as required by sec.
44AA, then a penalty of Rs. 25000 is leviable.
Sec.271B: Failure to get accounts audited.
If any person fails to get his accounts audited u/s.44AB or fails to furnish such audit report within the
due date, penalty will be imposable @ ½% of turnover or Rs.1 lakh, whichever is less.
(Rs. 1.50 lakh from 01.04.2011)
Sec.271C: Penalty for failure to deduct tax at Source.
• If any person fails to make TDS or fails to pay whole or any part of tax as required by sec. 115-
O (2) or sec. 194B 2nd prov. penalty equal to the amount of such tax not paid, will be leviable.
• Such penalty to be imposed by JCIT.
Sec.271CA: Penalty for failure to collect tax at source [w.e.f. A.Y.2007-08].
If any person fails to collect whole or any part of tax collectible, penalty equal to the amount
of such tax which he failed to collect will be leviable.
 Such penalty to be imposed by JCIT.
Sec.271D: Failure to comply with the provisions of sec. 269SS.
 If a person accepts loan or deposit in contravension of sec. 269SS, penalty equal to such loan
or deposit is leviable.
 Such penalty to be imposed by JCIT.
Sec.271E: Penalty for failure to comply with the provisions of sec. 269T.
If a person repays any loan or deposit in contravension of sec. 269T, penalty equal to amount
of repayment of such loan or deposit is leviable.
 Such penalty to be levied by JCIT.
Sec.271F: Failure to furnish return of income.
If any person fails to furnish a return of income before the expiry of relevant A.Y. then penalty
of Rs.5000/- is leviable.
Sec.271FA: Penalty for failure to furnish AIR.
If a person fails to furnish AIR as required u/s.285BA, then penalty will be leviable @ Rs.100 per day
of default.
Sec.272A(1): Penalty for failure to answer questions, sign statements etc.
If a person refuses to answer questions or to sign any statement or to attend or refuses to produce
books of a/c or any document he shall be penalised for a sum of Rs. 10000 for each such failure.
Sec.272A(2):Penalty for other failures.
 If a person commits defaults as per sec. 272A(2), he shall pay penalty of Rs100/- for each
day of default.
 However, penalty for failures u/s.197A, 203, 206, 206C not to exceed the amount of such
TDS or TCS.

3. Sec.272A(2):Penalty for other failures.
 Penalty to be imposed by officer not below the rank of JCIT.
 In case of failure as mentioned in sec. 272A(2)(f), by CCIT/CIT.
Sec.272B: Penalty for failure to comply with the provisions of sec. 139A.
 If a person fails to comply with the provisions of sec. 139A, a penalty of Rs.10,000/- is
leviable.
 If a person fails to quote his PAN, or quotes a wrong PAN a penalty of Rs.10,000/- is leviable.
Sec.272BB: Failure to comply with the provisions of sec.203A.
 If a person fails to comply with the provisions of sec. 203A, a penalty of Rs.10,000/- is
leviable.
 If a person fails to quote his TDAN or TCAN or TD & CAN in the challans statements,
certificates or misquotes such number, then a penalty of Rs.10,000/- is leviable.
Sec.273A(1) : Power to reduce or waive penalty.
 CIT may reduce or waive penalty u/s 271(1)(c), if he is satisfied that prior to the detection of
concealment by A.O.
 the assessee has, voluntarily and in good faith made full and true disclosure of all particulars
of income,
 Cooperated in enquiry relating to the assessment and recovery of tax,
 Paid the tax or interest.
 Where total amount of penalty exceeds Rs. 5 lakh for one A.Y. or more than one A.Y. , the CIT
is to take prior approval of CCIT or DGIT. Sec.273A(2).
 Where the assessee availed of such relief once, he shall not again be entitled to such relief
later. Sec.273A(3)
 Every order under this section shall be final and can not be questioned by any court or other
authority. Sec. 273A(5)
Sec.273A(4): Power to reduce or waive penalty.
CIT may reduce or waive any other penalty if he is satisfied that the assessee
 Co-operated in enquiry relating to the assessment and recovery of tax,
 On the ground of genuine hardship,
 Where total amount of penalty exceeds Rs. 1 lakh for one A.Y. or more than one A.Y. , the CIT
is to take prior approval of CCIT or DGIT.
 Every order under this section shall be final and can not be questioned by any court or other
authority. Sec. 273A(5).
Sec.273AA : Immunity from penalty.
A person may apply to the CIT for granting immunity from penalty if he has applied to the ITSC
u/s 245C and the proceedings have been abated u/s 245HA. The penalty proceeding has been initiated
u/s 271(1)(c) and is pending.
 The CIT may, subject to such conditions as he may impose, grant immunity if he is satisfied
that he cooperated with the deptt. and made true and full disclosure.
 Immunity may be withdrawn if he fails to comply with the conditions.
Sec.274- Procedure
No order imposing penalty under this chapter shall be made-
(a) by the ITO, where the penalty exceeds Rs. 10000.
(b) By the ACIT or DCIT, where the penalty exceeds Rs. 20000.
except with the previous approval of JCIT.
Any authority, other than the A.O. , passing any penalty order, must send a copy of the order to the
A.O. Sec.274(3).