What is Penalty for failure to furnish statement of financial transaction or reportable account? What is Penalty for furnishing inaccurate statement of financial transaction or reportable account? Section 271FA and 271FAA of Income Tax Act 1961

Penalty for failure to furnish statement of financial transaction or reportable account and Penalty for furnishing inaccurate statement of financial transaction or reportable account are defined under section 271FA and 271FAA of Income Tax Act 1961. Provisions under these Sections are:

Section 271FA of Income Tax Act "Penalty for failure to furnish statement of financial transaction or reportable account"

Section 271FA. If a person who is required to furnish [a statement of financial transaction or reportable account] under sub-section (1) of section 285BA, fails to furnish such [statement] within the time prescribed under sub-section (2) thereof, the income-tax authority prescribed under said sub-section (1) may direct that such person shall pay, by way of penalty, a sum of one hundred rupees for every day during which such failure continues:

Provided that where such person fails to furnish the [statement] within the period specified in the notice issued under sub-section (5) of section 285BA, he shall pay, by way of penalty, a sum of five hundred rupees for every day during which the failure continues, beginning from the day immediately following the day on which the time specified in such notice for furnishing the 92[statement] expires.

 

Section 271FAAA of Income Tax Act "Penalty for furnishing inaccurate statement of financial transaction or reportable account"

Section 271FAA. If a person referred to in clause (k) of sub-section (1) of section 285BA, who is required to furnish a statement under that section, provides inaccurate information in the statement, and where-

(a) the inaccuracy is due to a failure to comply with the due diligence requirement prescribed under sub-section (7) of section 285BA or is deliberate on the part of that person; or

(b) the person knows of the inaccuracy at the time of furnishing the statement of financial transaction or reportable account, but does not inform the prescribed income-tax authority or such other authority or agency; or

(c) the person discovers the inaccuracy after the statement of financial transaction or reportable account is furnished and fails to inform and furnish correct information within the time specified under sub-section (6) of section 285BA, then, the prescribed income-tax authority may direct that such person shall pay, by way of penalty, a sum of fifty thousand rupees.

Following section 271FAB shall be inserted after section 271FAA by the Finance Act, 2015, w.e.f. 1-4-2016 :

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