Amended and updated notes on section 271AA of Income Tax Act 1961 as amended by the Finance Act 2020 and Income-tax Rules, 1962. Detail discussion on provisions and rules related to Penalty for failure to keep and maintain information and document, etc., in respect of certain transactions.
Chapter XXI (Sections 270A to 275) of the Income Tax Act 1961 deals with the provisions related to penalties imposable. Section 271AA of IT Act 1961 provides for Penalty for failure to keep and maintain information and document, etc., in respect of certain transactions.
Recently, we have discussed in detail section 271A (Failure to keep, maintain or retain books of account, documents, etc.) of IT Act 1961. Today, we learn the provisions of section 271AA of Income-tax Act 1961. The amended provision of section 271AA is effective for financial year 2022-23 relevant to the assessment year 2023-24.
In this article, you will learn detail of the provisions of section 271AA of the Income Tax Act, 1961 Bare Act read with the Income-tax Rules, 1962 as provided by Ministry of Law and Justice, Government of India.
Section-271AA: Penalty for failure to keep and maintain information and document
Section 271AA(1) of Income Tax Act
Without prejudice to the provisions of section 270A or section 271 or section 271BA, if any person in respect of an international transaction or specified domestic transaction,—
- (i) fails to keep and maintain any such information and document as required by sub-section (1) or sub-section (2) of section 92D;
- (ii) fails to report such transaction which he is required to do so; or
- (iii) maintains or furnishes an incorrect information or document,
the Assessing Officer or Commissioner (Appeals) may direct that such person shall pay, by way of penalty, a sum equal to two per cent of the value of each international transaction or specified domestic transaction entered into by such person.
Section 271AA(2) of Income Tax Act
If any person fails to furnish the information and the document as required under sub-section (4) of section 92D, the prescribed income-tax authority referred to in the said sub-section may direct that such person shall pay, by way of penalty, a sum of five hundred thousand rupees.