Section 271BA — Failure to Furnish Report under Section 92E (Transfer-Pricing Accountant’s Report)
Case Laws & Commentary — Income-tax Act, 1961 (as amended by the Finance Act, 2026) — bharattax.co Treatise
Status: Live. A fixed penalty of Rs. 1,00,000 for failure to furnish the accountant’s report required by section 92E in respect of international transactions or specified domestic transactions. Subject to reasonable cause under section 273B.
Finance Act, 2026: No amendment by the Finance Act, 2026.
Mechanism: Failure to furnish the section 92E accountant’s report (Form 3CEB) by the due date → fixed penalty of Rs. 1,00,000 → unless reasonable cause is shown under section 273B.
Litigation profile: Lightly litigated. The recurring issues are the reasonable-cause defence and the bona fide belief that a transaction did not require a section 92E report.
A. COMMENTARY
A fixed-sum compliance penalty
Section 271BA enforces the filing of the transfer-pricing accountant’s report under section 92E. Unlike sections 271AA and 271G (percentage-of-value penalties), it is a flat Rs. 1,00,000 levy for the failure to furnish the report. It is the transfer-pricing analogue of section 271B.
Reasonable cause and bona fide belief
Being within section 273B, the penalty yields to reasonable cause. The most common defence is a bona fide and disclosed view that the transaction was not an international transaction or SDT requiring a section 92E report — for instance, a genuine dispute over associated-enterprise status or the SDT threshold.
B. STATUTORY TEXT (verbatim)
Reproduced from the Income-tax Act, 1961 as amended up to the Finance Act, 2025; Finance Act, 2026 changes are noted above.
Penalty for failure to furnish report under section 92E.
271BA. If any person fails to furnish a report from an accountant as required by section 92E, the Assessing
Officer may direct that such person shall pay, by way of penalty, a sum of one hundred thousand rupees.
C. AUTHORITIES
Direct authority is sparse; the candour rule applies. The governing principle is the section 273B reasonable-cause shield.
1. Reasonable cause / bona fide belief
Principle — bona fide view that no section 92E report was due
Proposition A genuine, substantiated belief that the transaction was not an international transaction or SDT requiring a section 92E report constitutes reasonable cause under section 273B and defeats the Rs. 1,00,000 penalty.
Use The principal defence to a 271BA levy.
Hindustan Steel Ltd v. State of Orissa (1972) 83 ITR 26 (SC)
Holding Penalty is not to be imposed for a technical or bona fide default; discretion is to be exercised judicially.
Use Applied to resist a mechanical 271BA penalty.
Prepared for the bharattax.co Treatise on the Income-tax Act, 1961 (as amended by the Finance Act, 2026). Statutory text reproduced from the official Act; case-law holdings are the author’s summaries for professional use.
CHAPTER XXI — PENALTIES IMPOSABLE
Section 271BA — Failure to Furnish Report under Section 92E (Transfer-Pricing Accountant’s Report)
Case Laws & Commentary — Income-tax Act, 1961 (as amended by the Finance Act, 2026) — bharattax.co Treatise
Status: Live. A fixed penalty of Rs. 1,00,000 for failure to furnish the accountant’s report required by section 92E in respect of international transactions or specified domestic transactions. Subject to reasonable cause under section 273B.
Finance Act, 2026: No amendment by the Finance Act, 2026.
Mechanism: Failure to furnish the section 92E accountant’s report (Form 3CEB) by the due date → fixed penalty of Rs. 1,00,000 → unless reasonable cause is shown under section 273B.
Litigation profile: Lightly litigated. The recurring issues are the reasonable-cause defence and the bona fide belief that a transaction did not require a section 92E report.
A. COMMENTARY
A fixed-sum compliance penalty
Section 271BA enforces the filing of the transfer-pricing accountant’s report under section 92E. Unlike sections 271AA and 271G (percentage-of-value penalties), it is a flat Rs. 1,00,000 levy for the failure to furnish the report. It is the transfer-pricing analogue of section 271B.
Reasonable cause and bona fide belief
Being within section 273B, the penalty yields to reasonable cause. The most common defence is a bona fide and disclosed view that the transaction was not an international transaction or SDT requiring a section 92E report — for instance, a genuine dispute over associated-enterprise status or the SDT threshold.
B. STATUTORY TEXT (verbatim)
Reproduced from the Income-tax Act, 1961 as amended up to the Finance Act, 2025; Finance Act, 2026 changes are noted above.
Penalty for failure to furnish report under section 92E.
271BA. If any person fails to furnish a report from an accountant as required by section 92E, the Assessing
Officer may direct that such person shall pay, by way of penalty, a sum of one hundred thousand rupees.
C. AUTHORITIES
Direct authority is sparse; the candour rule applies. The governing principle is the section 273B reasonable-cause shield.
1. Reasonable cause / bona fide belief
Principle — bona fide view that no section 92E report was due
Proposition A genuine, substantiated belief that the transaction was not an international transaction or SDT requiring a section 92E report constitutes reasonable cause under section 273B and defeats the Rs. 1,00,000 penalty.
Use The principal defence to a 271BA levy.
Hindustan Steel Ltd v. State of Orissa (1972) 83 ITR 26 (SC)
Holding Penalty is not to be imposed for a technical or bona fide default; discretion is to be exercised judicially.
Use Applied to resist a mechanical 271BA penalty.
Prepared for the bharattax.co Treatise on the Income-tax Act, 1961 (as amended by the Finance Act, 2026). Statutory text reproduced from the official Act; case-law holdings are the author’s summaries for professional use.