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Note 1. Where the Person responsible for deducting tax, fails to do so, then he shall be deemed to be assessee in default.

Note 2. As per Section 221, Penalty shall not be charged, until AO is satisfied that, default was for good and sufficient reasons.

Section Nature of default Consequences
271C Fails to deduct the whole or any part of the tax  Penalty for a sum equal to the amount of tax which such person failed to deduct or pay – Imposable by the Joint Commissioner
276B Failure to pay tax deducted at source Punishable with rigorous imprisonment for a term which shall not be less than 3 months but which may extend to 7 years and with fine.
276BB Failure to pay tax Collected at Source punishable with rigorous imprisonment for a term which shall not be less than 3 months but which may extend to 7 years and with fine.
272A(2) Failure to issue TDS Certificates or,
Failure to issue declaration under section 15H
penalty of Rs. 500 for every day of the default But it can’t exceed the amount of TDS.
272BB Failure to Apply for TAN or to quote it on relevant documents Penalty of Rs. 10,000/-
234E Late furnishing of TDS/TCS Statements or furnishing incorrect information in TDS/TCS Statements Late fees Rs. 200 for every day of default But it can’t exceed the amount of tax deductible or collectible and such fees shall be paid before delivering the statement
271H Late furnishing of TDS/TCS Statements or furnishing incorrect information in TDS/TCS Statements Penalty which shall not be less than Rs. 10,000 which may extend to Rs. 1,00,000 shall also be levied in addition to the late fees U/s 234E
201(1A) Not deducted the whole or any part of the tax or,
After deducting fails to pay the tax
Shall be liable to pay simple interest-
-1%  for per month or part of a month on the amount of such tax from the date on which such tax was deductible to the date on which such tax is deducted-1.5%  for every month or part of a month on the amount of such tax from the date on which such tax was deducted to the date on which such tax is actually paid

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One Comment

  1. Amit kumar jangir says:

    I received a short deduction Notice from Traces after three years I e, for the financial year 2016-17, Now I received short deduction notice for deducting Less TDS on salary. But my employees have already filed their Income Tax Returns by paying difference amount by Self Assessment Tax challans. Is it I need to deduct TDS again in this year and submit the revised TDS returns for the financial year 2016-17. If so is it Individual Assessee will get credit of the TDS amount ? Than how to replay for this Notice ?

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