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ITA Chapter 22

Contravention of order made during search action

  1. Whoever contravenes any order referred to in section 247(4) shall be punishable with 19[simple imprisonment up to two years and with fine]

Failure to comply with section 247(1)(ii)

  1. If a person, who is required to afford the authorised officer with the necessary facility to inspect the books of account or other documents, under section 247(1)(ii)15, fails to do so, he shall be punishable with 21[simple imprisonment for a term up to six months, or with fine, or with both

Removal, concealment, transfer or delivery of property to prevent tax recovery

  1. Whoever, fraudulently removes, conceals, transfers or delivers to any person, any property or any interest therein, with the intent to prevent such property or interest therein from being taken in execution of a certificate drawn under section 413, shall be punishable with 21[simple imprisonment for a term up to two years and with fine

Failure to pay tax to credit of Central Government under Chapter XIX-B.

  1. If a person fails to—
    1. pay the tax deducted at source by him to the credit of the Central Government, as required by or under the provisions of Chapter XIX-B; or
    2. pay tax or ensure payment of tax to the credit of the Central Government in respect of—
      1. any income by way of winnings from online games as referred in section 393(3) [Table: Sl. No. 2], excluding such winnings which are wholly in kind, as referred to in Note 2 to the said Table; or
      2. any sum by way of consideration for transfer of a virtual digital asset as referred in section 393(1) [Table: Sl. No. 8(vi)], excluding such consideration which is wholly in kind, as referred to in Note 6 to the said Table,
    he shall be punishable—
    1. with simple imprisonment for a term up to two years, or with fine, or with both, where the amount of such tax exceeds ₹50,00,000;
    2. with simple imprisonment for a term up to six months, or with fine, or with both, where the amount of such tax exceeds ₹10,00,000 but does not exceed ₹50,00,000;
    3. with fine, in any other case.
  2. The provisions of this section shall not apply if the payment referred to in sub-section (1)(a) has been made to the credit of the Central Government on or before the time prescribed for filing the statement under section 397(3)(b) in respect of such payment.

Failure to pay tax collected at source

  1. If a person fails to pay the tax collected by him to the credit of the Central Government, as required under section 397(3)(a), he shall be punishable—
    1. with simple imprisonment for a term up to two years, or with fine, or with both, where the amount of such tax exceeds ₹50,00,000; or
    2. with simple imprisonment for a term up to six months or with fine, or with both, where the amount of such tax exceeds ₹10,00,000 but does not exceed ₹50,00,000; or
    3. with fine, in any other case.
  2. The provisions of this section shall not apply if the payment of the tax collected at source has been made to the credit of the Central Government on or before the time prescribed for filing the statement under section 397(3)(b) in respect of such payment.

Wilful attempt to evade tax, etc

  1. If a person wilfully attempts in any manner to evade any tax, penalty or interest chargeable or imposable, or under-reports his income, under this Act, he shall be punishable—
    1. with simple imprisonment for a term up to two years, or with fine, or with both, where the amount sought to be evaded or tax on under-reported income exceeds ₹50,00,000; or
    2. with simple imprisonment for a term up to six months, or with fine, or with both, where the amount sought to be evaded or tax on under-reported income exceeds ₹10,00,000 but does not exceed ₹50,00,000; or
    3. with fine, in any other case.
  2. If a person wilfully attempts in any manner to evade payment of any tax, penalty or interest under this Act, he shall be punishable—
    1. with simple imprisonment for a term up to two years, or with fine, or with both, where the amount sought to be evaded exceeds ₹50,00,000; or
    2. with simple imprisonment for a term up to six months, or with fine, or with both, where the amount sought to be evaded exceeds ₹10,00,000 but does not exceed ₹50,00,000; or
    3. with fine, in any other case.
  3. The punishment referred to in this section shall be without prejudice to any penalty that may be imposable under any other provision of this Act.
  4. For the purposes of this section, a wilful attempt to evade any tax, penalty or interest chargeable or imposable under this Act, or the payment thereof, shall include a case where any person—
    1. has in his possession or control any books of account or other documents (being books of account or other documents relevant to any proceeding under this Act) containing a false entry or statement; or
    2. makes or causes to be made any false entry or statement in such books of account or other documents; or
    3. wilfully omits or causes to be omitted any relevant entry or statement in such books of account or other documents; or
    4. causes any other circumstance to exist which will have the effect of enabling such person to evade any tax, penalty or interest chargeable or imposable under this Act or the payment thereof.

Failure to furnish returns of income

  1. If a person wilfully fails to furnish in due time the return of income, which is required to be furnished under section 263(1), or by notice given under section 268(1) or 280, he shall be punishable—
    1. with simple imprisonment for a term up to two years, or with fine, or with both, where the amount of tax, which would have been evaded if the failure had not been discovered, exceeds ₹50,00,000; or
    2. with simple imprisonment for a term up to six months, or with fine, or with both, where the amount of tax, which would have been evaded if the failure had not been discovered, exceeds ₹10,00,000 but does not exceed ₹50,00,000; or
    3. with fine, in any other case.
  2. A person shall not be proceeded against under sub-section (1) for failure to furnish in due time the return of income under section 263(1) for any tax year, if—
    1. a return is furnished by him under section 263(4) or 263(6); or
    2. the tax payable by such person, not being a company, on the total income determined on regular assessment, as reduced by the advance tax or self-assessment tax, if any, paid before the expiry of period specified under section 263(4), and any tax deducted or collected at source, does not exceed ₹10,000.

Failure to furnish return of income setting forth undisclosed income

  1. If a person wilfully fails to furnish in due time the return of income, setting forth his undisclosed income for the block period, which is required to be furnished by notice given under section 294(1)(a), he shall be punishable—
    1. with simple imprisonment for a term up to two years, or with fine, or with both, where the amount of tax exceeds ₹50,00,000; or
    2. with simple imprisonment up to six months, or with fine, or with both, where the amount of tax exceeds ₹10,00,000 but does not exceed ₹50,00,000; or
    3. with fine, in any other case.

Failure to comply with a direction of special audit or valuation

  1. If a person wilfully fails to comply with a direction issued to him under sec- tion 268(5), he shall be punishable with simple imprisonment for a term up to six months, or with fine, or with both

False statement in verification, etc

  1. If a person makes a statement in any verification under this Act or under any rule made thereunder, or delivers an account or statement which is false, and which he either knows or believes to be false, or does not believe to be true, he shall be punishable—
    1. with simple imprisonment for a term up to two years, or with fine, or with both, where the amount of tax, which would have been evaded if the statement or account had been accepted as true, exceeds ₹50,00,000; or
    2. with simple imprisonment for a term up to six months, or with fine, or with both, where the amount of tax, which would have been evaded if the statement or account had been accepted as true, exceeds ₹10,00,000 but does not exceed ₹50,00,000; or
    3. with fine, in any other case.

Falsification of books of account or document, etc

  1. If any person (herein referred to as the first person) wilfully and with intent to enable any other person (herein referred to as the second person) to evade any tax or interest or penalty chargeable and imposable under this Act, makes or causes to be made any entry or statement which is false and which the first person either knows to be false or does not believe to be true, in any books of account or other document relevant to or useful in any proceedings against the first person or the second person, under this Act, the first person shall be punishable with simple imprisonment for a term up to two years and with fine.
  2. For the purposes of establishing the charge under this section, it shall not be necessary to prove that the second person has actually evaded any tax, penalty or interest chargeable or imposable under this Act.

Abetment of false return, etc

  1. If a person abets or induces in any manner another person—
    1. to make and deliver an account or a statement or declaration relating to any income chargeable to tax which is false and which he either knows to be false or does not believe to be true; or
    2. to commit an offence under section 478(1),
    he shall be punishable—
    1. with simple imprisonment for a term up to two years, or with fine, or with both, where the amount of tax, penalty or interest which would have been evaded, if the declaration, account or statement had been accepted as true, or which is wilfully attempted to be evaded, exceeds ₹50,00,000; or
    2. with simple imprisonment for a term up to six months, or with fine, or with both, where the amount of tax, penalty or interest which would have been evaded, if the declaration, account or statement had been accepted as true, or which is wilfully attempted to be evaded, exceeds ₹10,00,000 but does not exceed ₹50,00,000; or
    3. with fine, in any other case.

Punishment for second and subsequent offences

  1. If any person convicted of an offence under section 476, 477, 478(1), 479, 480, 482 or 484 is again convicted of an offence under any of the said sections, he shall be punishable for the second and for every subsequent offence with simple imprisonment for a term which shall not be less than six months but which may extend to three years and with fine.

Punishment not to be imposed in certain cases

  1. No person shall be punishable for any failure referred to in section 476 or 477, irrespective of anything contained in that section, if he proves that there was reasonable cause for such failure

Offences by companies

  1. If an offence under this Act has been committed by a company, every person who, at the time the offence was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company as well as the company shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.
  2. The provisions of sub-section (1) shall not apply if the person referred therein proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.
  3. Irrespective of anything contained in sub-sections (1) and (2), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.
  4. If an offence under this Act has been committed by a company and the punishment for such offence is imprisonment and fine, then, without prejudice to the provisions contained in sub-section (1) or (3), such company shall be punished with fine and every person referred to in sub-section (1), or the director, manager, secretary or other officer of the company referred to in sub-section (3), shall be liable to be proceeded against and punished as per the provisions of this Act.
  5. For the purposes of this section—
    1. “company” means a body corporate and includes—
      1. a firm; and
      2. an association of persons or a body of individuals, whether incorporated or not.
    2. “director”, in relation to—
      1. a firm, means a partner in the firm;
      2. any association of persons or a body of individuals, means any member controlling the affairs thereof.

Offences by Hindu undivided family

  1. Where an offence under this Act has been committed by a Hindu undivided family, the karta thereof shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.
  2. Nothing contained in sub-section (1) shall render the karta liable to any punishment, if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.
  3. Irrespective of anything contained in sub-sections (1) and (2), where an offence under this Act has been committed by a Hindu undivided family and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any member of the Hindu undivided family, such member shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

Presumption as to assets, books of account, etc., in certain cases

  1. Where during the course of any search made under section 247, any money, bullion, jewellery, virtual digit asset or other valuable article or thing (hereinafter referred to as the assets) or any books of account or other documents or any information in electronic form as defined in section 261(g) or on a computer system as defined in section 261(e) or any computer system containing the said information, has or have been found in the possession or control of any person and such assets or books of account or other documents or such information are tendered by the prosecution in evidence against such person, or against such person and the person referred to in section 484, for an offence under this Act, the provisions of section 247(7) shall, so far as may be, apply in relation to such assets or books of account or other documents or such information.
  2. Where any assets or books of account or other documents, any information in electronic form or on a computer system or any computer system containing the said information taken into custody from the possession or control of any person, by the officer or authority referred to in section 248(1)(a) or (b) or (c) are delivered to the requisitioning officer under sub-section (2) of that section and such assets, books of account or other documents or such information are tendered by the prosecution in evidence against such person, or against such person and the person referred to in section 484, for an offence under this Act, the provisions of section 247(7) shall, so far as may be, apply in relation to such assets or books of account or other documents or such information.

Presumption as to culpable mental state

  1. In any prosecution for any offence under this Act, which requires a culpable mental state on the part of the accused, the court shall presume the existence of such mental state but it shall be a defence for the accused to prove the fact that he had no such mental state with respect to the Act charged as an offence in that prosecution.
  2. For the purposes of this section, the expression “culpable mental state” includes intention, motive or knowledge of a fact or belief in, or reason to believe, a fact.
  3. For the purposes of this section, a fact is said to be proved only when the court believes it to exist beyond reasonable doubt and not merely when its existence is established by a preponderance of probability.

Prosecution to be at instance of Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner

  1. A person shall not be proceeded against for an offence under section 473, 474, 475, 476, 477, 478, 479, 480, 481, 482, 483 or 484 except with the previous sanction of the Principal Commissioner or Commissioner or Commissioner (Appeals) or Joint Commissioner (Appeals).
  2. The Principal Chief Commissioner or Chief Commissioner or Principal Director General or Director General may issue such instructions or directions to the income-tax authorities mentioned in sub-section (1) as he may deem fit for institution of proceedings under that sub-section.
  3. A person shall not be proceeded against for an offence under section 478 or 482 in relation to the assessment for a tax year in respect of which the penalty imposed or imposable on him under section 439 has been reduced or waived by an order under section 469.
  4. Any offence under this Chapter may be compounded, either before or after the institution of proceedings, by the Principal Chief Commissioner or Chief Commissioner or a Principal Director General or Director General.
  5. Where any proceeding has been taken against any person under sub-section (1), any statement made or account or other document produced by such person before any income-tax authority specified in section 236(a) to (k) shall not be inadmissible as evidence for the purpose of such proceedings merely on the ground that—
    1. such statement was made or such account or document was produced in the belief that the penalty imposable would be reduced or waived, under section 469; or
    2. the offence for which such proceeding was taken would be compounded.
  6. The power of the Board to issue orders, instructions or directions under this Act shall include the power to issue instructions or directions (including instructions or directions to obtain the previous approval of the Board) to other income-tax authorities for the proper composition of offences under this section.

Certain offences to be non-cognizable

  1. Irrespective of anything contained in the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023), an offence punishable under section 476, 478, 479, 480, 482 or 484 shall be deemed to be non-cognizable within the meaning of that Sanhita.

Proof of entries in records or documents

  1. Entries in the records or other documents in the custody of an income-tax authority shall be admitted in evidence in any proceedings for the prosecution of any person for an offence under this Chapter, and all such entries may be proved either by—
    1. the production of the records or other documents in the custody of the income-tax authority containing such entries; or
    2. the production of a copy of the entries certified by the income-tax authority having custody of the records or other documents under its signature and stating that it is a true copy of the original entries and that such original entries are contained in the records or other documents in its custody.

Disclosure of particulars by public servants

  1. A public servant, who furnishes any information or produces any document in contravention of the provisions of section 258(3), shall be punishable with simple imprisonment up to one month, or with fine, or with both.
  2. No prosecution shall be instituted under this section except with the previous sanction of the Central Government.

Special Courts

  1. The Central Government, in consultation with the Chief Justice of the High Court, may, for trial of offences punishable under this Chapter, by notification, designate one or more courts of Judicial Magistrate of the first class as Special Court for such area or areas, or for such cases or class or group of cases, as specified in the notification.
  2. For the purposes of this section, the expression “High Court” means the High Court of the State in which a Judicial Magistrate of first class designated as Special Court was functioning immediately before such designation.
  3. While trying an offence under this Act, a Special Court shall also try an offence, other than an offence referred to in sub-section (1), with which the accused may, under the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023), be charged at the same trial.

Offences triable by Special Court

  1. Irrespective of anything contained in the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023)—
    1. the offences punishable under this Chapter shall be triable only by the Special Court, if so designated, for the area or areas or for cases or class or group of cases, as the case may be, in which the offence has been committed;
    2. a Special Court may, upon a complaint made by an authority authorised in this behalf under this Act, take cognizance of the offence for which the accused is committed for trial.
  2. For the purposes of sub-section (1)(a), the court competent to try offences under section 520—
    1. which has been designated as a Special Court under this section, shall continue to try the offences before it or offences arising under this Act after such designation;
    2. which has not been designated as a Special Court, may continue to try such offence pending before it till its disposal.

Trial of offences as summons case

  1. The Special Court, irrespective of anything contained in the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023), shall try an offence under this Chapter punishable with imprisonment not exceeding two years or with fine, or with both, as a summons case, and the provisions of the Bharatiya Nagarik Surak- sha Sanhita, 2023 as applicable in the case of trial of summons case, shall apply accordingly.

Application of Bharatiya Nagarik Suraksha Sanhita, 2023 to proceedings before Special Court

  1. Save as otherwise provided in this Act, the provisions of Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023) (including the provisions as to bails or bonds), shall apply to the proceedings before a Special Court and the person conducting the prosecution before the Special Court shall be deemed to be a Public Prosecutor.
  2. The Central Government may also appoint a Special Public Prosecutor for any case or class or group of cases.
  3. A person shall not be qualified to be appointed as a Public Prosecutor or a Special Public Prosecutor under this section unless he has been in practice as an advocate for not less than seven years, requiring special knowledge of law.
  4. Every person appointed as a Public Prosecutor or a Special Public Prosecutor under this section shall be deemed to be a Public Prosecutor within the meaning of section 2(1)(v) of the Bharatiya Nagarik Suraksha Sanhita, 2023, and the provisions of that Sanhita shall have effect accordingly.

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