Income-tax law | Offences and prosecutions | Updated October 2026

Section 276CC of the Income-tax Act, 1961: Wilful Failure to File Income-tax Returns

Section 276CC provides for prosecution where a person wilfully fails to furnish a legally required return of income within the prescribed time. The Finance Act, 2026 revised its punishments from 1 March 2026; the Income-tax Act, 2025 applies from 1 April 2026.

Important update: Section 26 of the Finance Act, 2026 substituted Section 276CC with effect from 1 March 2026. The current corresponding provision in the Income-tax Act, 2025 is Section 479. The rules for older assessment years and earlier conduct must be read with the applicable repeal and savings provisions.

1. Meaning and scope of Section 276CC

Section 276CC addresses wilful failure to furnish a return in due time. A late return or a missed deadline does not automatically establish the required criminal intent. The prosecution must be assessed against the applicable statutory requirements, evidence and rules concerning culpable mental state.

Under the substituted provision, the relevant filing obligations include returns of income under Section 139(1) and returns required by notices under Section 142(1)(i), Section 148 or Section 153A. Historical references to fringe-benefit returns under Sections 115WD and 115WH remain in the statutory text, although the fringe-benefit-tax regime is no longer an ongoing tax regime.

2. Definitions of related provisions

Section 139(1): specifies persons required to furnish a return of income within the prescribed due date.
Section 139(8A): provides for an updated return, subject to its eligibility conditions, time limits and additional tax requirements.
Section 142(1)(i): permits the Assessing Officer to require a return by notice for the purposes of assessment.
Section 148: concerns a notice for furnishing a return in reassessment proceedings, subject to the applicable procedural safeguards.
Section 153A: historically concerned assessment following search or requisition in specified cases; its application depends on the relevant period and statutory regime.
Wilful failure: a deliberate omission rather than an inadvertent mistake; criminal intent is evaluated in light of the facts and relevant statutory presumptions.

3. Punishment under the Finance Act, 2026

For offences governed by the substituted Section 276CC, the punishment depends on the tax that would have been evaded if the failure had not been discovered, not simply the taxpayer's total income.

Tax that would have been evaded	Statutory punishment
Exceeds Rs. 50 lakh	Simple imprisonment up to two years, or fine, or both
Exceeds Rs. 10 lakh but does not exceed Rs. 50 lakh	Simple imprisonment up to six months, or fine, or both
Rs. 10 lakh or less	Fine

These are statutory sentencing categories, not automatic penalties. The offence and applicable amount must be established in the relevant proceedings.

4. When prosecution is excluded under the proviso

The proviso applies specifically to failure to furnish the return under Section 139(1) or the historical fringe-benefit return under Section 115WD(1), and not indiscriminately to every notice-based filing failure.

Earlier assessment years: it excludes prosecution for assessment years commencing before 1 April 1975.
Return filed within the assessment year: the proviso protects a person who files the relevant return before that assessment year expires.
Updated return: the proviso also covers a return filed under Section 139(8A) within the period permitted by that provision.
Small residual tax for non-companies: prosecution is excluded where the tax payable on regular assessment, after specified reductions for timely advance or self-assessment tax and TDS/TCS, does not exceed Rs. 10,000.

The Rs. 10,000 condition is not a general exemption from filing returns. It is a limited prosecution safeguard for qualifying persons other than companies. The precise tax computation and dates matter.

5. Practical examples

Deliberate non-filing despite a statutory obligation

A person who intentionally ignores a filing obligation and conceals significant taxable income may face scrutiny under Section 276CC if the statutory elements are established.

Updated return filed within the prescribed period

A taxpayer who qualifies to file and validly furnishes an updated return under Section 139(8A) may benefit from the express proviso in relation to an original Section 139(1) filing failure. It does not automatically dispose of separate offences.

Non-filing after a statutory notice

A wilful failure to respond to a return-filing notice under a provision named in Section 276CC is distinct from the initial filing default; the proviso's scope must be checked carefully.

6. Earlier punishment and amendments

Before the Finance Act, 2026 substitution, the section generally prescribed rigorous imprisonment from six months to seven years and fine where the relevant tax exceeded Rs. 25 lakh, and imprisonment from three months to two years and fine in other cases. The original article reproduced that older wording and historical amendment footnotes. Those sentencing terms are no longer the substituted text effective 1 March 2026.

The Finance Act, 2022 added protection for qualifying updated returns under Section 139(8A), while other historical changes included amendments made by the Finance Act, 2012 and the Finance Act, 2018. For an earlier alleged offence, check the operative law, dates and any applicable protections.

7. Section 479 of the Income-tax Act, 2025

The Income-tax Act, 2025 came into force on 1 April 2026. Its Section 479 covers wilful failure to furnish a return required under Section 263(1), or by notices under Sections 268(1) or 280. As amended by the Finance Act, 2026, it adopts the same three punishment bands described above.

Section 479(2) contains its own exclusions for a return furnished under Section 263(4) or 263(6), and for qualifying non-company cases where residual tax payable does not exceed Rs. 10,000 after the specified reductions. These are not word-for-word identical to the former Section 276CC proviso. Section 536 of the 2025 Act contains repeal and savings rules relevant to legacy cases.

8. Prosecution, evidence and compliance

Prosecution for non-filing is distinct from late fees, interest, assessment or other civil consequences. Questions of sanction under Section 279 of the 1961 Act, culpable mental state under Section 278E, and any applicable compounding or immunity procedure require individual examination. Taxpayers should preserve filing acknowledgements, notices, responses, payment evidence and records explaining any delay.

9. Frequently asked questions

What does Section 276CC cover?

Wilful failure to file a required income-tax return within the prescribed time, including specified returns required by notices.

What is the punishment under the Finance Act 2026?

Tax above Rs. 50 lakh: simple imprisonment up to two years, or fine, or both; above Rs. 10 lakh and up to Rs. 50 lakh: simple imprisonment up to six months, or fine, or both; otherwise fine.

Can filing an updated return prevent prosecution?

For failure to file under Section 139(1), the statutory proviso protects a person who files a return under Section 139(8A) within its permitted time. Other requirements and circumstances must be checked.

What is the corresponding provision under the Income-tax Act 2025?

Section 479 of the Income-tax Act, 2025 governs wilful failure to furnish returns, with its own exceptions and updated punishment provisions.

10. Official statutory references

Editorial note: General legal information updated October 2026. Apply the statute, commencement dates, savings provisions and case law to the facts of any individual proceeding.