Failure to pay tax to credit of Central Government under Chapter XIX-B
[Section-476 as per the Income Tax Act, 2025 (this Act) w.e.f. 1st April, 2026.]
Section 476(1) of Income Tax Act 2025
476(1) If a person fails to—
- 476(1)(a) pay to the credit of the Central Government, the tax deducted at source by him as required by or under the provisions of Chapter XIX-B; or
- 476(1)(b) pay tax or ensure payment of tax to the credit of the Central Government, as required under—
- (i) Note 3 in Table in section 393(3); or
- (ii) Note 6 to section 393(1) (Table: Sl. No. 8),
he shall be punishable with rigorous imprisonment for a term which shall not be less than three months but which may extend to seven years, and shall also be liable to fine.
Section 476(2) of Income Tax Act 2025
476(2) The provisions of this section shall not apply if the payment referred to in sub-section (1)(a) has been credited to the Central Government on or before the time prescribed for filing the statement for such payment under section 397(3)(b).
FAQs on Section 476 of Income Tax Act 2025
What is the offence described under Section 476(1)(a) of the Income Tax Act, 2025?
If a person fails to pay the tax deducted at source (TDS) to the credit of the Central Government as required under Chapter XIX-B, it constitutes an offence under Section 476(1)(a).
What additional situations are covered under Section 476(1)(b) for failure to pay tax?
Section 476(1)(b) applies if a person fails to pay or ensure payment of tax to the credit of the Central Government as required under either Note 3 in the Table in section 393(3), or Note 6 to section 393(1) (Table: Sl. No. 8).
What are the consequences of committing an offence under Section 476(1)?
A person found guilty under Section 476(1) is punishable with rigorous imprisonment for a term not less than three months but which may extend to seven years, and shall also be liable to a fine.
Is there any relief available for the offence under Section 476(1)(a)?
Yes. As per Section 476(2), the offence under 476(1)(a) does not apply if the deducted tax has been credited to the Central Government on or before the due date prescribed for filing the statement under section 397(3)(b).
Does the relief under Section 476(2) also apply to offences under Section 476(1)(b)?
No. The relief under Section 476(2) is limited only to the failure specified in Section 476(1)(a), and does not extend to failures covered under Section 476(1)(b).
What is the minimum term of imprisonment for failure under Section 476(1)?
The minimum term of imprisonment is three months.
What is the maximum term of imprisonment prescribed under Section 476(1)?
The maximum term of imprisonment is seven years.
Is fine also imposed in addition to imprisonment under Section 476?
Yes. The offender is also liable to a fine in addition to rigorous imprisonment.
Does this section apply to both individuals and entities?
Yes. The language “a person” includes individuals, HUFs, firms, companies, and other legal entities as defined under this Act.
What is the significance of the references to Notes in section 393 in Section 476(1)(b)?
The references in 476(1)(b) identify specific tax compliance obligations that must be met. Failure to comply with those specific notes results in liability under this penal provision.
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