Amended and updated notes on section 278AB of Income Tax Act 1961 as amended by the Finance Act 2022 and Income-tax Rules, 1962. Detail discussion on provisions and rules related to Power of Principal Commissioner or Commissioner to grant immunity from prosecution.
Chapter XXII (Sections 275A to 280D) of the Income Tax Act 1961 deals with the provisions related to offences and prosecutions. Section 278AB of IT Act 1961 provides for Power of Principal Commissioner or Commissioner to grant immunity from prosecution.
Recently, we have discussed in detail section 278AA (Punishment not to be imposed in certain cases) of IT Act 1961. Today, we learn the provisions of section 278AB of Income-tax Act 1961. The amended provision of section 278AB is effective for financial year 2022-23 relevant to the assessment year 2023-24.
In this article, you will learn detail of the provisions of section 278AB of the Income Tax Act, 1961 Bare Act read with the Income-tax Rules, 1962 as provided by Ministry of Law and Justice, Government of India.
Section-278AB: Power of Principal Commissioner or Commissioner to grant immunity from prosecution
Section 278AB(1) of Income Tax Act
A person may make an application to the Principal Commissioner or Commissioner for granting immunity from prosecution, if he has made an application for settlement under section 245C and the proceedings for settlement have abated under section 245HA.
Section 278AB(2) of Income Tax Act
The application to the Principal Commissioner or Commissioner under sub-section (1) shall not be made after institution of the prosecution proceedings after abatement.
Section 278AB(3) of Income Tax Act
The Principal Commissioner or Commissioner may, subject to such conditions as he may think fit to impose, grant to the person immunity from prosecution for any offence under this Act, if he is satisfied that the person has, after the abatement, co-operated with the income-tax authority in the proceedings before him and has made a full and true disclosure of his income and the manner in which such income has been derived :
Provided that where the application for settlement under section 245C had been made before the 1st day of June, 2007, the Principal Commissioner or Commissioner may grant immunity from prosecution for any offence under this Act or under the Indian Penal Code (45 of 1860) or under any other Central Act for the time being in force.
Section 278AB(4) of Income Tax Act
The immunity granted to a person under sub-section (3) shall stand withdrawn, if such person fails to comply with any condition subject to which the immunity was granted and thereupon the provisions of this Act shall apply as if such immunity had not been granted.
Section 278AB(5) of Income Tax Act
The immunity granted to a person under sub-section (3) may, at any time, be withdrawn by the Principal Commissioner or Commissioner, if he is satisfied that such person had, in the course of any proceedings, after abatement, concealed any particulars material to the assessment from the income-tax authority or had given false evidence, and thereupon such person may be tried for the offence with respect to which the immunity was granted or for any other offence of which he appears to have been guilty in connection with the proceedings.