ITR

Penalty for not replying to Section 142(1) notices

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Find

Yes. Under the 1961 Act, failure to comply with a Sec 142(1) or 143(2) notice can attract a penalty of ₹10,000 for each failure, after a chance to be heard.

Provisions

Sec 272A(1)(d), Income-tax Act 1961; Sec 142(1), Income-tax Act 1961 (now Sec 268(1))

Analysis

If three notices went unanswered, the exposure can be ₹30,000, separate from tax on the assessed income. A good reason, such as illness or the notice going to a wrong address, can be pleaded when the penalty notice comes. Replying now reduces the chance of more defaults being counted.

Close

  1. Count the notices you missed.
  2. Reply to the pending notice now.
  3. Keep proof of any reason for earlier delay.
  4. When a penalty show-cause comes, reply with that reason.
  5. Appeal if a penalty order is passed unfairly.

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