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What is Procedure? What is Bar of limitation for imposing penalties? Section 274 and 275 of Income Tax Act 1961

Procedure and Bar of limitation for imposing penalties are defined under section 274 and 275 of Income Tax Act 1961. Provisions under these Sections are:

Section 274 of Income Tax Act "Procedure"

Section 274. (1) No order imposing a penalty under this Chapter shall be made unless the assessee has been heard, or has been given a reasonable opportunity of being heard.

(2) No order imposing a penalty under this Chapter shall be made-

(a) by the Income-tax Officer, where the penalty exceeds ten thousand rupees;

 

(b) by the Assistant Commissioner or Deputy Commissioner, where the penalty exceeds twenty thousand rupees,
except with the prior approval of the Joint Commissioner.

(3) An income-tax authority on making an order under this Chapter imposing a penalty, unless he is himself the Assessing Officer, shall forthwith send a copy of such order to the Assessing Officer.

Section 275 of Income Tax Act "Bar of limitation for imposing penalties"

Section 275. (1) No order imposing a penalty under this Chapter shall be passed-

(a) in a case where the relevant assessment or other order is the subject-matter of an appeal to the Commissioner (Appeals) under section 246 or section 246A or an appeal to the Appellate Tribunal under section 253, after the expiry of the financial year in which the proceedings, in the course of which action for the imposition of penalty has been initiated, are completed, or six months from the end of the month in which the order of the Commissioner (Appeals) or, as the case may be, the Appellate Tribunal is received by the 8[Principal Chief Commissioner or] Chief Commissioner or [Principal Commissioner or] Commissioner, whichever period expires later :

Provided that in a case where the relevant assessment or other order is the subject-matter of an appeal to the Commissioner (Appeals) under section 246 or section 246A, and the Commissioner (Appeals) passes the order on or after the 1st day of June, 2003 disposing of such appeal, an order imposing penalty shall be passed before the expiry of the financial year in which the proceedings, in the course of which action for imposition of penalty has been initiated, are completed, or within one year from the end of the financial year in which the order of the Commissioner (Appeals) is received by the 8[Principal Chief Commissioner or] Chief Commissioner or 8[Principal Commissioner or] Commissioner, whichever is later;

(b) in a case where the relevant assessment or other order is the subject-matter of revision under section 263 or section 264, after the expiry of six months from the end of the month in which such order of revision is passed;

(c) in any other case, after the expiry of the financial year in which the proceedings, in the course of which action for the imposition of penalty has been initiated, are completed, or six months from the end of the month in which action for imposition of penalty is initiated, whichever period expires later.

(1A) In a case where the relevant assessment or other order is the subject-matter of an appeal to the Commissioner (Appeals) under section 246 or section 246A or an appeal to the Appellate Tribunal under section 253 or an appeal to the High Court under section 260A or an appeal to the Supreme Court under section 261 or revision under section 263 or section 264 and an order imposing or enhancing or reducing or cancelling penalty or dropping the proceedings for the imposition of penalty is passed before the order of the Commissioner (Appeals) or the Appellate Tribunal or the High Court or the Supreme Court is received by the [Principal Chief Commissioner or] Chief Commissioner or the 9[Principal Commissioner or] Commissioner or the order of revision under section 263 or section 264 is passed, an order imposing or enhancing or reducing or cancelling penalty or dropping the proceedings for the imposition of penalty may be passed on the basis of assessment as revised by giving effect to such order of the Commissioner (Appeals) or, the Appellate Tribunal or the High Court, or the Supreme Court or order of revision under section 263 or section 264:

Provided that no order of imposing or enhancing or reducing or cancelling penalty or dropping the proceedings for the imposition of penalty shall be passed-

(a) unless the assessee has been heard, or has been given a reasonable opportunity of being heard;

(b) after the expiry of six months from the end of the month in which the order of the Commissioner (Appeals) or the Appellate Tribunal or the High Court or the Supreme Court is received by the [Principal Chief Commissioner or] Chief Commissioner or the [Principal Commissioner or] Commissioner or the order of revision under section 263 or section 264 is passed:

Provided further that the provisions of sub-section (2) of section 274 shall apply in respect of the order imposing or enhancing or reducing penalty under this sub-section.

(2) The provisions of this section as they stood immediately before their amendment by the Direct Tax Laws (Amendment) Act, 1987 (4 of 1988), shall apply to and in relation to any action initiated for the imposition of penalty on or before the 31st day of March, 1989.

Explanation.-In computing the period of limitation for the purposes of this section,-

(i) the time taken in giving an opportunity to the assessee to be reheard under the proviso to section 129;

(ii) any period during which the immunity granted under section 245H remained in force; and

(iii) any period during which a proceeding under this Chapter for the levy of penalty is stayed by an order or injunction of any court, shall be excluded.

Income Tax Act 1961

What is Penalty for failure to answer questions, sign statements, furnish information, returns or statements, allow inspections, etc? Section 272A of Income Tax Act 1961

What is Penalty for failure to comply with the provisions of section 133B? What is Penalty for failure to comply with the provisions of section 139A? Section 272AA and 272B of Income Tax Act 1961

What is Penalty for failure to comply with the provisions of section 203A? Penalty for failure to comply with the provisions of section 206CA? Section 272BB and 272BBB of Income Tax Act 1961

What is False estimate of, or failure to pay, advance tax? What is Power to reduce or waive penalty, etc., in certain cases? Section 273 and 273A of Income Tax Act 1961

What is Power of [Principal Commissioner or] Commissioner to grant immunity from penalty? What is the meaning Penalty not to be imposed in certain cases? Section 273AA and 273B of Income Tax Act 1961

What is Procedure? What is Bar of limitation for imposing penalties? Section 274 and 275 of Income Tax Act 1961

What is Contravention of order made under sub-section (3) of section 132? What is Failure to comply with the provisions of clause (iib) of sub-section (1) of section 132? Section 275A and 275B of Income Tax Act 1961

What is Removal, concealment, transfer or delivery of property to thwart tax recovery? What is Failure to comply with the provisions of sub-sections (1) and (3) of section 178? Section 276 and 276A of Income Tax Act 1961

What is Failure to comply with the provisions of sections 269UC, 269UE and 269UL? What is Failure to pay tax to the credit of Central Government under Chapter XII-D or XVII-B? Section 276AB and 276B of Income Tax Act 1961

What is Failure to pay the tax collected at source? What is Willful attempt to evade tax, etc? Section 276BB and 276C of Income Tax Act 1961

What is Failure to furnish returns of income? What is Failure to furnish return of income in search cases? Section 276CC and 276CCC of Income Tax Act 1961

What is Failure to produce accounts and documents? What is False statement in verification, etc? Section 276D and 277 of Income Tax Act 1961

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