Income Tax Act 2025: Section 442 for Tax Year 2025-26

Penalty of 2% of transaction value or ₹5 lakh for failure to maintain, report, or furnish correct documents in certain transactions under Income Tax Act 2025.

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Penalty for failure to keep and maintain information and document, etc., in respect of certain transactions

[As per the Income Tax Act, 2025 (this Act) w.e.f. 1st April, 2026.]

Section 442(1) of Income Tax Act 2025

(1) The Assessing Officer or Commissioner (Appeals) may impose a penalty of 2% of the value of each international transaction or specified domestic transaction entered into by a person, if in respect of such transaction he,—

(a) fails to keep and maintain any such information and document as required by section 171(1);
(b) fails to report such transaction as he is required to do so; or
(c) maintains or furnishes an incorrect information or document.

Section 442(2) of Income Tax Act 2025

(2) The prescribed income-tax authority referred to in section 171(4) may impose a penalty of five lakh rupees on a person, if he fails to furnish the information and document required under the said section.

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