Section 271BB — Failure to Subscribe to Units of Capital (Omitted)
Case Laws & Commentary — Income-tax Act, 1961 (as amended by the Finance Act, 2026) — bharattax.co Treatise
Status: Omitted. Section 271BB was omitted by the Finance Act, 2025, with effect from 1 April 2025. It formerly penalised the failure to subscribe to the eligible issue of capital (referable to the now-defunct section 88A). No penalty survives.
Finance Act, 2026: No amendment by the Finance Act, 2026 (the section having already been omitted with effect from 1-4-2025 by the Finance Act, 2025).
Mechanism: Spent. Until its omission, the section levied a penalty for failure to subscribe to the eligible issue of capital within the meaning of the erstwhile section 88A.
Litigation profile: No live litigation; the section is omitted and its substantive base (section 88A) was itself long defunct.
A. COMMENTARY
A vestige now removed
Section 271BB tied to the erstwhile section 88A rebate for subscription to eligible equity issues. With section 88A long gone, section 271BB had become a dead letter; the Finance Act, 2025 formally omitted it with effect from 1 April 2025. It is reproduced here only to keep the Chapter complete and to explain references in older texts.
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 subscribe to the eligible issue of capital.
271BB. Omitted by the Finance Act, 2025, w.e.f.1-4-2025.
C. AUTHORITIES
No authority of current value exists; the candour rule applies. The consequence of omission is governed by the general principle that an omitted penalty cannot be enforced for subsequent defaults.
1. Effect of omission
General Finance Co. v. ACIT (2002) 257 ITR 338 (SC)
Holding An omitted provision, absent a saving clause, cannot found proceedings for actions taken after the date of omission.
Use Confirms that no section 271BB penalty can be levied for any period; cited only to explain the effect of omission.
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 271BB — Failure to Subscribe to Units of Capital (Omitted)
Case Laws & Commentary — Income-tax Act, 1961 (as amended by the Finance Act, 2026) — bharattax.co Treatise
Status: Omitted. Section 271BB was omitted by the Finance Act, 2025, with effect from 1 April 2025. It formerly penalised the failure to subscribe to the eligible issue of capital (referable to the now-defunct section 88A). No penalty survives.
Finance Act, 2026: No amendment by the Finance Act, 2026 (the section having already been omitted with effect from 1-4-2025 by the Finance Act, 2025).
Mechanism: Spent. Until its omission, the section levied a penalty for failure to subscribe to the eligible issue of capital within the meaning of the erstwhile section 88A.
Litigation profile: No live litigation; the section is omitted and its substantive base (section 88A) was itself long defunct.
A. COMMENTARY
A vestige now removed
Section 271BB tied to the erstwhile section 88A rebate for subscription to eligible equity issues. With section 88A long gone, section 271BB had become a dead letter; the Finance Act, 2025 formally omitted it with effect from 1 April 2025. It is reproduced here only to keep the Chapter complete and to explain references in older texts.
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 subscribe to the eligible issue of capital.
271BB. Omitted by the Finance Act, 2025, w.e.f.1-4-2025.
C. AUTHORITIES
No authority of current value exists; the candour rule applies. The consequence of omission is governed by the general principle that an omitted penalty cannot be enforced for subsequent defaults.
1. Effect of omission
General Finance Co. v. ACIT (2002) 257 ITR 338 (SC)
Holding An omitted provision, absent a saving clause, cannot found proceedings for actions taken after the date of omission.
Use Confirms that no section 271BB penalty can be levied for any period; cited only to explain the effect of omission.
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.