Section 271AAB of the Income-tax Act, 1961, previously imposed a penalty for searches initiated after December 15, 2016. However, the Finance Bill 2025 amends this provision, stating that the penalty under Section 271AAB will no longer apply for searches conducted on or after September 1, 2024. For searches conducted between September 1, 2024, and March 31, 2025, the penalty under Section 271AAB will not be applicable. Instead, a penalty of 50% will be imposed as per Section 158BFA for searches initiated under Section 132 on or after September 1, 2024. This amendment alters the penalty structure for such searches.
Page Contents
- FAQs Budget 2025: Non applicability of Section 271AAB of the Act
- Q1. What is section 271AAB of Income-tax Act, 1961?
- Q.2 What is the amendment brought in section 271AAB of Income-tax Act, 1961 by Finance Bill 2025?
- Q.3 Is penalty under section 271AAB applicable or searches conducted between 01.09.2024 and 01.04.2025?
- Q.4 Which penalty is applicable for searches initiated after 01.09.2024?
FAQs Budget 2025: Non applicability of Section 271AAB of the Act
Q1. What is section 271AAB of Income-tax Act, 1961?
Ans. Section 271AAB of the Income-tax Act, 1961 relates to penalty in respect of searches initiated after 15.12.2016.
Q.2 What is the amendment brought in section 271AAB of Income-tax Act, 1961 by Finance Bill 2025?
Ans. Penalty under section 271AAB is not applicable for searches conducted on or after 01.09.2024
Q.3 Is penalty under section 271AAB applicable or searches conducted between 01.09.2024 and 01.04.2025?
Ans. No, penalty under section 271AAB is not applicable for searches conducted on or after 01.09.2024.
Q.4 Which penalty is applicable for searches initiated after 01.09.2024?
Ans. Penalty @50% as per section 158BFA shall be leviable on an assessee in whose case search has been initiated under section 132 on or after the 01.09.2024.
