Amended and updated notes on section 273AA of Income Tax Act 1961 as amended by the Finance Act 2022 and Income-tax Rules, 1962. Detail discussion on provisions and rules related to Power of Principal Commissioner or Commissioner to grant immunity from penalty.
Chapter XXI (Sections 270A to 275) of the Income Tax Act 1961 deals with the provisions related to penalties imposable. Section 273AA of IT Act 1961 provides for Power of Principal Commissioner or Commissioner to grant immunity from penalty.
Recently, we have discussed in detail section 273A (Power to reduce or waive penalty, etc., in certain cases) of IT Act 1961. Today, we learn the provisions of section 273AA of Income-tax Act 1961. The amended provision of section 273AA 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 273AA 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-273AA: Power of Principal Commissioner or Commissioner to grant immunity from penalty
Section 273AA(1) of Income Tax Act
A person may make an application to the Principal Commissioner or Commissioner for granting immunity from penalty, if—
- (a) he has made an application for settlement under section 245C and the proceedings for settlement have abated under section 245HA; and
- (b) the penalty proceedings have been initiated under this Act.
Section 273AA(2) of Income Tax Act
The application to the Principal Commissioner or Commissioner under sub-section (1) shall not be made after the imposition of penalty after abatement.
Section 273AA(3) of Income Tax Act
The Principal Commissioner or Commissioner may, subject to such conditions as he may think fit to impose, grant to the person immunity from the imposition of any penalty under this Act, if he is satisfied that the person has, after the abatement, co-operated with the income-tax authority in the proceedings before him and has made a full and true disclosure of his income and the manner in which such income has been derived.
Section 273AA(3A) of Income Tax Act
The order under sub-section (3), either accepting or rejecting the application in full or in part, shall be passed within a period of twelve months from the end of the month in which the application under the said sub-section is received by the Principal Commissioner or the Commissioner:
Provided that no order rejecting the application, either in full or in part, shall be passed unless the assessee has been given an opportunity of being heard:
Provided further that where any application is pending as on the 1st day of June, 2016, the order shall be passed on or before the 31st day of May, 2017.
Section 273AA(4) of Income Tax Act
The immunity granted to a person under sub-section (3) shall stand withdrawn, if such person fails to comply with any condition subject to which the immunity was granted and thereupon the provisions of this Act shall apply as if such immunity had not been granted.
Section 273AA(5) of Income Tax Act
The immunity granted to a person under sub-section (3) may, at any time, be withdrawn by the Principal Commissioner or Commissioner, if he is satisfied that such person had, in the course of any proceedings, after abatement, concealed any particulars material to the assessment from the income-tax authority or had given false evidence, and thereupon such person shall become liable to the imposition of any penalty under this Act to which such person would have been liable, had not such immunity been granted.