Penalty for failure to furnish statements, etc.
[Section-461 as per the Income Tax Act, 2025 (this Act) w.e.f. 1st April, 2026.]
Section 461(1) of Income Tax Act 2025
461(1) Where a person, who is required to deliver or causes to be delivered a statement prescribed in section 397(3)(b), fails to do so within the time prescribed in the said section, or furnishes incorrect information in the said statement, the Assessing Officer may impose on such person, a penalty of a sum which shall not be less than ten thousand rupees but which may extend to one lakh rupees.
Section 461(2) of Income Tax Act 2025
461(2) No penalty shall be levied under sub-section (1) for delay in filing or non-filing of statement referred therein, if the person proves that—
- 461(2)(a) tax deducted or collected along with the fee and interest, if any, was paid to the credit of the Central Government; and
- 461(2)(b) the said statement was also delivered before the expiry of one month from the time prescribed in section 397(3)(b).
FAQs on Section 461 of Income Tax Act 2025
What is the penalty for failure to furnish the statement under section 397(3)(b)?
If a person fails to furnish the required statement under section 397(3)(b) within the prescribed time or furnishes incorrect information in the statement, the Assessing Officer may impose a penalty between ₹10,000 and ₹1,00,000.
What is the minimum and maximum penalty that can be imposed under section 461(1)?
The minimum penalty is ₹10,000 and the maximum penalty is ₹1,00,000.
Who has the authority to impose the penalty under section 461(1)?
The Assessing Officer is empowered to impose the penalty under section 461(1).
Does the penalty apply only to delayed filing, or also to incorrect information?
The penalty applies both to delay in furnishing the statement and to furnishing incorrect information in the statement.
Can the penalty be waived or avoided under any circumstances?
Yes, the penalty shall not be levied if specific conditions mentioned in section 461(2) are satisfied.
What are the conditions under which no penalty shall be levied for failure to furnish the statement?
No penalty shall be imposed if:
(a) The tax deducted or collected, along with applicable fee and interest, has been paid to the credit of the Central Government; and
(b) The statement is delivered within one month from the due date specified in section 397(3)(b).
Is there a time limit for furnishing the statement to avoid penalty?
Yes, the statement must be delivered within one month from the prescribed time in section 397(3)(b) to qualify for penalty exemption.
Does payment of tax alone absolve the person from penalty under section 461?
No, along with the payment of tax, the person must also furnish the statement within the extended one-month period to avoid penalty.
If incorrect information is filed but within the time limit, can penalty still be imposed?
Yes, furnishing incorrect information can attract penalty even if filed within the prescribed time.
Is the penalty under section 461 automatic?
No, the penalty is not automatic. It is discretionary and may be imposed by the Assessing Officer based on the facts of the case.
Can a person contest the penalty imposed under section 461?
Yes, a person can appeal against the penalty order as per the applicable appellate provisions of the Income Tax Act, 2025.
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