Interest & Penalty Provisions Under Income Tax Act, 1961

Interest and penalty provisions apply to the assessee when he contravenes the provisions of the Income Tax Act. Some of them are mandatory while others are at the discretion of the tax authorities.

There are various penalties under Income Tax Act, 1961 which an assessee can attract intentionally or unintentionally. One must be aware of the penalties arising from negligent non-compliances to safeguard themselves from bearing severe consequences.

Rs.5000 if ITR is filed before 31 st December of the AY.

Rs.10000 if ITR is filed after 31 st December but before 31 st March of the AY.

> Those who have made expenditure`towards electricity consumption
exceeding Rs.1 lakh.

> Individuals with expenses over Rs.2 lakhs on foreign travel.

> Those who have a total deposit of more than Rs.1 crore in one or multiple current accounts with a bank.

> Those who are Indian residents but have
income from foreign assets.

Further in the Case of SENIOR CITIZENS:

The Said penalty shall be applicable only in the following cases:

> Aged between 60-80 years with a total taxable income of more than Rs.3 Lakhs

> Aged above 80 years with total taxable income exceeding Rs.5 Lakhs.

√ to answer any questions asked by the Income Tax Authorities which he/she is required to answer

√ to sign the statements required by the
Income Tax Authorities

√ to give evidence

√ to produce the books under summon u/s131 (1).

√ to comply with the notice issued u/s 142(1) or 143(2) or 142(2A).

-Failure by the Indian concern to furnish any information or The document under Section 285A

(a)Transaction impacted the transfer of management/control of an ndian Concern – 2% of the value of the such transaction

Other Cases – Rs.5,00,000/-

(b) Delay

Less than one month- Rs.5,000/ per day

More than one month- Rs.15,000/ per day

0.5% of the Total Sales, turnover or gross receipts, etc.

Or Rs.150000 whichever is less

Tax Audit Applicability:

Penalties related to self-assessment tax payment

• Failure to pay wholly or partly— Such amount as Assessing Officer(AO) may impose but not exceeding tax in arrears
  • self-assessment tax/fringe benefit tax, or
  • interest, and fee, or
  • both under section 140A(1)

  Penalties related to Unexplained Income

  > As per Sec 271AAC -Income determined by the Assessing Officer includes any income referred to in section 68, section 69, section 69A, section 69B, section 69C, or section 69D for any previous year and such income is not included by the assessee in his return or tax in accordance with section 115BBE has not been paid then penalty equal to 10% of tax payable under section 115BBE shall be payable by the assessee in default.

  Cash Transactions Related Penalty Provisions-

  

  Other Penalties under Income Tax Act, 1961

  

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