Penalty on professionals for furnishing incorrect information in statutory report or certificate
Many people always wonder that all the compliance and prosecutor restrictions will be on taxpayers and not on the professionals who are handling their files. But this is not the case, all the professionals are also held responsible for all the certification work done by them. Today we will have a little discussion on it in this article.
The thrust of the Government in recent past is on voluntary compliance. Certification of various reports and certificates by a qualified professional has been provided in the Act to ensure that the information furnished by an assessee under the provisions of the Act is correct. Various provisions exist under the Act to penalise the defaulting assessee in case of furnishing incorrect information. However, there exist no penal provision for levy of penalty for furnishing incorrect information by the person who is responsible for certifying the same.
In order to ensure that the person furnishing report or certificate undertakes due diligence before making such certification, government has inserted a section 271J so as to provide that if an accountant or a merchant banker or a registered valuer, furnishes incorrect information in a report or certificate under any provisions of the Act or the rules made thereunder, the Assessing Officer or the Commissioner (Appeals) may direct him to pay a sum of ten thousand rupees for each such report or certificate by way of penalty.
It is further proposed to define the expressions “accountant”, “merchant banker” and “registered valuer“. It is also proposed to provide through amendment of Section 273B that if the person proves that there was reasonable cause for the failure referred to in the said section, then penalty shall not be imposable in respect of the proposed section 271J.
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(Republished with Amendments by Team Taxguru)