Penalty for failure to furnish information or furnishing inaccurate information under section 397(3)(d)

Section 462 — PENALTY FOR FAILURE TO FURNISH INFORMATION OR FURNISHING INACCURATE INFORMATION UNDER SECTION 397(3)(D)

Section 462 of the Income-tax Act, 2025 corresponds to s. 271I of the Income-tax Act, 1961.

STATUTORY ARCHITECTURE

Section 462 is a penalty provision tied to the information that a person is required to furnish under s. 397(3)(d). It applies to any person who is under that requirement. There are two triggers: failing to furnish the information at all, or furnishing inaccurate information. On either trigger, the Assessing Officer may impose a penalty of ₹100000 on that person. The section is a single sentence with no sub-sections, provisos or explanations.

KEY ELEMENTS

• Person covered: any person who is required to furnish information under s. 397(3)(d).
• First trigger: failure to furnish that information.
• Second trigger: furnishing inaccurate information.
• Authority: the Assessing Officer.
• Consequence: a penalty of ₹100000. The amount is stated as a fixed sum, not as a range or a maximum.
• Discretion: the section says the Assessing Officer "may" impose the penalty.

CHANGES FROM THE 1961 ACT

The corresponding provision is s. 271-I of the 1961 Act. The changes visible on comparing the two texts are:

• The information is now the information required under s. 397(3)(d), in place of the information required under s. 195(6) of the 1961 Act.
• The 1961 Act provided that the Assessing Officer "may direct that such person shall pay, by way of penalty" a sum; the 2025 text says the Assessing Officer "may impose a penalty" on such person.
• The amount, expressed in the 1961 Act as "one lakh rupees", is expressed in figures as ₹100000 in the 2025 text. The amount is the same.

The triggers (failure to furnish, or furnishing inaccurate information) and the authority (the Assessing Officer) are unchanged. In substance the provision is the same.

PRACTITIONER NOTES

• The penalty turns on the existence of a requirement under s. 397(3)(d). Whether a person is covered must be tested against that provision first.
• Furnishing the information is not enough to avoid exposure; inaccurate information is a separate trigger carrying the same amount.
• The text fixes one amount for both triggers. It does not scale the penalty by the number of defaults or by the amount of any payment.
• Because the Assessing Officer "may" impose the penalty, the levy is not automatic on the words of the section.
• The penalty is imposed "on such person", that is, on the person required to furnish the information.

CROSS-REFERENCES

• s. 397(3)(d) — the requirement to furnish information whose breach attracts the penalty.
• s. 271-I and s. 195(6) of the 1961 Act — the corresponding penalty provision and the 1961 source of the information requirement.