Section 272A of the Income-tax Act, 1961: Penalties for Non-Compliance
A practical explanation of penalties for refusing to answer questions, failing to sign statements, ignoring summons, omitting prescribed information and obstructing inspections, together with the corresponding provisions of the Income-tax Act, 2025.
Meaning and scope of Section 272A
Section 272A of the Income-tax Act, 1961 prescribed monetary penalties for specified failures to cooperate with income-tax authorities and to furnish information, statements, declarations or documents required by law. Sub-section (1) dealt with individual refusals or defaults; sub-section (2) generally addressed continuing failures.
Section 272A(1): Rs. 10,000 for each default
Under the later version of section 272A(1), the penalty was Rs. 10,000 for each failure or default involving:
- Clause (a): refusing to answer a lawful question concerning an assessment when legally bound to state the truth.
- Clause (b): refusing to sign a statement made during proceedings when the authority can legally require a signature.
- Clause (c): failing to attend or produce books or documents at the specified place or time under a summons issued under section 131(1).
- Clause (d): failing to comply with a notice under section 142(1) or 143(2), or a special-audit direction under section 142(2A).
Section 272A(2): Rs. 500 per day for continuing failures
The later applicable rate was Rs. 500 for every day during which a specified failure continued, subject to statutory limits and exclusions. The relevant clauses included:
| Clause | Nature of default under the 1961 Act |
|---|---|
| (a) | Failure to comply with a notice under section 94(6) concerning securities. |
| (b) | Failure to notify discontinuance of business or profession under section 176(3). |
| (c) | Late furnishing of returns, statements or particulars under sections 133, 206, 206C or 285B, as applicable. |
| (d) | Failure to permit inspection or copying of registers under section 134. |
| (e) | Failure to furnish returns required under section 139(4A) or 139(4C) within the prescribed time and manner. |
| (f) | Failure to deliver a declaration under section 197A. |
| (g) | Failure to furnish a certificate under section 203 or section 206C. |
| (h) | Failure to deduct and pay tax under section 226(2). |
| (i) | Failure to furnish a statement under section 192(2C). |
| (j) | Failure to deliver the declaration referred to in section 206C(1A). |
| (k) | Late delivery of statements under section 200(3) or the proviso to section 206C(3), subject to the statutory exclusion for relevant TDS/TCS statements on or after 1 July 2012. |
| (l) | Late delivery of statements under section 206A(1). |
| (m) | Failure to deliver statements prescribed under section 200(2A) or section 206C(3A). |
Limits: The statute caps certain penalties by reference to the tax deductible or collectible. Other special provisions, including section 271H for specified TDS/TCS statement defaults, must be checked to avoid applying an excluded or overlapping penalty.
Procedure, safeguards and reasonable cause
Section 272A(3) identifies the authority empowered to impose a penalty, depending on the proceedings and nature of default. Section 272A(4) requires a reasonable opportunity of being heard. Section 273B may protect a person who proves reasonable cause for defaults specified in that section, subject to the applicable law and facts. The penalty notice, compliance record, applicable limitation and available appeal remedies should all be examined.
Corresponding provision under the Income-tax Act, 2025
Section 465 of the Income-tax Act, 2025 addresses similar failures. Section 465(1) prescribes Rs. 10,000 per default, including refusals to answer or sign, failure to obey summons under section 246(1), and non-compliance with specified notices or directions under sections 268 and 270. Section 465(2) prescribes Rs. 500 per day for specified continuing failures, with relevant statutory qualifications. Refer to the complete text of section 465 for the precise duties, exceptions, penalty authority and procedure.
Examples of how penalties are calculated
Example 1: One qualifying refusal to sign a statement under section 272A(1) may attract Rs. 10,000. Separate defaults require separate examination.
Example 2: A qualifying continuing default lasting 12 days under section 272A(2) would ordinarily calculate to Rs. 6,000 (12 x Rs. 500), before considering applicable caps, exclusions or relief.
Frequently asked questions
Is Section 272A still applicable after April 2026?
The 2025 Act has replaced the 1961 Act for the new statutory framework, but earlier-year liabilities and proceedings may continue under applicable savings provisions. Section 465 is the corresponding provision under the 2025 Act.
Does every late TDS statement attract Section 272A(2)?
No. The statutory exclusion for certain statements and the separate provisions concerning late filing fees and penalties must be considered.
Can a penalty be imposed without a hearing?
The penalty framework requires the prescribed opportunity of being heard. A taxpayer should review the notice and respond with evidence of compliance or reasonable cause where available.
Official legislation and guidance
Income Tax Department - Section 272A, Income-tax Act, 1961
Income Tax Department - Income-tax Act, 2025 (see section 465)
Income Tax Department - Penalties and Prosecutions
Ministry of Finance - Commencement of the Income-tax Act, 2025
This article is general legal information. Apply the version of the legislation relevant to the tax year, default and proceedings.