The penalty provision of section 271G of the Income Tax Act applies to the person (who has entered into an international transaction / specified domestic transaction) fails to furnish information / document within the prescribed time limit as specified under provisions of section 92D (3) of the Income Tax Act.

The current article tries to explain the provisions of section 271G, explaining together the connecting provisions of section 92D (3). The article also lists down the authority who is authorized to impose a penalty under section 271G and amount of a penalty payable under section 271G.

Applicability of provisions of section 271G

The provisions of section 271G of the Income Tax Act gets applicable in case the following conditions are satisfied –

1. The person has entered into an international transaction / specified domestic transaction.

[Please note meaning of the term ‘international transaction’ is explained under section 92B and meaning of the term ‘specified domestic transaction’ is explained under section 92BA of the Income Tax Act.]

2. The Assistant Commissioner or Commissioner (Appeals) has prescribed such person to provide information / document within a period of 30 days of the receipt of the notice [as per provisions of section 92D (3) of the Income Tax Act].

3. Such person fails to furnish the required information / documents within the prescribed time limit.

In case all the above conditions are satisfied, the defaulter would be liable to pay penalty under section 271G of the Income Tax Act.

An authority who can impose a penalty under section 271G

It is important to note here that only the following list of authorities are authorized to direct the defaulter to pay the penalty under section 271G of the Income Tax Act

  1. The Assessing Officer; or
  2. The Transfer Pricing Officer as referred under section 92CA; or
  3. The Commissioner (Appeals).

Penalty not to be imposed under section 271G in specified case

As seen penalty under section 271G is levied in case the person fails to furnish information / documents specified under section 92D (3) within the prescribed time limit. However, as per section 273B of the Income Tax Act, in case the defaulter proves the reasonable cause for such failure, then, no penalty can be imposed under section 271G.

Amount of penalty payable under section 271G

In case of failure in furnishing of information / documents as required under section 92D (3), the defaulter would be liable to pay penalty amount equal to 2% of the value of the international transaction / specified domestic transaction.

Read Also:-

S. No. Title
1 Section 272BB Penalty for failure to comply section 203A provisions
2 Section 272B Penalty for failure to comply with provisions of PAN
3 Section 272AA Penalty for failure in complying with provisions of section 133B
4 Section 272A Penalty for failure to answer questions or furnish information / returns/ statements or allow inspections etc
5 Section 271J Penalty on professionals for furnishing incorrect information in reports / certificates
6 Section 271I Penalty for failure in furnishing Form 15CA & Form 15CB
7 Section 271H Penalty for late filing/non-filing of TDS or TCS return
8 Penalty for failure in furnishing report or furnishing inaccurate report under section 286 – Section 271GB
9 Section 271GA Penalty for failure in furnishing the information / document in Form 49D as required under section 285A
10 Section 271G Penalty for failure to furnish information / document as per provisions of section 92D
11 Section 271FB Penalty for default in furnishing return of fringe benefits
12 Section 271FAB Penalty for failure to furnish statement / information / document by an eligible investment fund
13 Penalty for providing inaccurate statement of financial transaction or reportable account- Section 271FAA
14 Section 271FA Penalty for failure in furnishing statement of financial transactions or reportable account
15 Section 271E Penalty for contravening provisions of section 269T
16 Section 271DB | Penalty for contravening provisions of section 269SU
17 Section 271DA Penalty for contravening provisions of section 269ST
18 Section 271CA Penalty for failure to collect tax at source (TCS)
19 Section 271D Penalty for contravening provisions of section 269SS
20 Section 271C Penalty for failure / non-deduction / non-payment of TDS
21 TDS Rate Chart for AY 2020-21 and AY 2021-22
22 Section 271BA Penalty for failure to furnish section 92E report
23 Section 271B Penalty for failure to get accounts audited
24 Section 271AAC Penalty in respect of certain specified income
25 Section 271AA Penalty for failure to maintain Transfer Pricing documents
26 Section 271A Penalty for failure to keep / maintain or retain books of accounts, documents
27 Section 270A(1) Penalty for under-reporting & misreporting of income
28 Section 269SU Acceptance of payment through electronic modes
29 Section 234F Late fees for default in filing of income tax return
30 Section 234E Late Fee for default in filing of TDS / TCS returns
31 Section 158BFA(2) – Penalty on undisclosed income for block period
32 Section 140A(3) Penalty for non-payment of self-assessment tax

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