Empowering Board to issue directions in respect of penalty for failure to deduct or collect tax at source

Existing provision of clause (a) of sub-section (2) of section 119 empowers the Board to issue orders setting forth directions or instructions (not being prejudicial to assessees) to be followed by subordinate authorities in the work relating to assessment or collection of revenue or the initiation of proceedings for the imposition of penalties.

In order to reduce the genuine hardship which may be faced by a person responsible for deduction and collection of tax at source due to levy of penalty under section 271C or 271 CA, it is proposed to insert reference of sections 271C and 271 CA in the said clause, so as to empower the Board to issue directions or instructions in respect of the said sections also.

The amendment will take effect from 1st April, 2017.

[Clause 49]

Extract of relevant clause from Finance Bill, 2017

Amendment of section 119.

49. In section 119 of the Income-tax Act, in sub-section (2), in clause (a), after the figures “271”, the figures and letters “,271C, 271CA” shall be inserted.

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