Answer

1. F

   Facts

   No. A prosecution under Sec 276CC can be launched only with the previous sanction of a senior authority named in Sec 279. The show cause notice is part of the process before that sanction.

2. P

   Provisions and law

   • Sec 279, Income-tax Act 1961Prosecution needs sanction of a senior authority, and offences can be compounded
   • Sec 276CC (now Sec 479)Prosecution for wilful failure to file a return on time; jail of 3 months to 2 years, or 6 months to 7 years where tax evaded exceeds ₹25 lakh
   • CBDT Circular 24/2019, dated 9 September 2019Where the tax sought to be evaded is ₹25 lakh or less, prosecution for non-filing needs prior approval of a collegium of senior officers
3. A

   Analysis

   Sec 279(1) of the 1961 Act requires sanction from the Principal Commissioner, Commissioner or other specified authority. For smaller cases, the collegium approval under Circular 24/2019 adds another check. Your reply goes to the officer who will recommend whether to seek sanction. A complete reply with filed returns gives them reason not to.

4. C

   Conclusion

   1. 1Note the officer who issued the show cause.
   2. 2Reply fully to that officer.
   3. 3File returns and pay tax before the reply date.
   4. 4Keep track of any further communication.

General guidance from TaxSavvy’s library of money processes. Laws change; your Savvy confirms the answer on your exact case before anything is filed.