Failure to Comply with Direction u-s s. 254

Section 481 — - FAILURE TO COMPLY WITH DIRECTION U/S S. 254

Section 481 of the Income-tax Act, 2025 corresponds to s. 276D of the Income-tax Act, 1961.

STATUTORY ARCHITECTURE

Up to 1 year imprisonment with fine for failure to comply with direction issued under s. 254 [s. 142(1) / s. 142(2A) special audit] -- e.g., furnishing accounts, getting accounts audited.

PRACTITIONER PLANNING NOTES

• Time-extension request can avoid prosecution; document AO's grant or refusal.

CROSS-REFERENCES

• s. 491 [279] -- sanction and compounding.
• s. 486 [278AA] -- reasonable cause.
• s. 487 [278B] -- offences by companies.
• s. 490 [278E] -- presumption of culpable mental state.