Our business & residential premises were raided by Income tax under search & seizure procedures in the year 2005. We were subsequently asked to file returns from 1999-2005 which we did wherein we declared additional incomes to the tunes of 15 Lacs rupees & paid taxes with interest threon. However during the assessment for these search & seizure years, the department took a view that the difference between the original return & the new return amounts to concealment & imposed a penalty of 100%.What is the legal status? Are there any supreme court judgements in this respect?
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Search and seizure-penalty
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Penalties under Income Tax Act
| Section | Nature of Default | Basis of Charge | Quantum of penalty |
| 221(1) | Failure to pay tax; i.e., non-payment of tax required by notice u/s. 156. | -- | Amount of tax in arrears |
| 271(1)(b) | Non-compliance with notice u/s. 142(1) to file returns or to producedocuments required by assessing officer or u/s. 143(2) to produce evidence on which assessee relies or u/s. 142(2A) to get accounts audited. | -- | Rs. 10,000 |
| 271(1)(c) | Concealment of the particulars of income, or furnishing inaccurate particulars thereof. | Tax sought to be evaded | 100 % to 300 % of tax sought to be evaded |
| 271A | Failure to maintain books or documents u/s. 44AA. | -- | Rs. 25,000 |
| 271AA | Failure to keep and maintain information and documents u/s. 92D. | International transaction | 2% of International transaction |
| 271B | Failure to get accounts audited and furnish Tax Audit Report as required u/s. 44AB. | Total Sales, Turnover, or Gross Receipts | 0.5% of total sales, turnover or gross receipts, or Rs. 1,00,000 whichever is less |
| 271BA | Failure to furnish a report as required u/s. 92E. | -- | Rs. 1,00,000 |
| 271C | Failure to deduct the whole or part of the tax as required by or under Chapter XVII-B (Ss. 192 to 196D) or failure to pay the whole or part of tax u/s. 115-O. | Tax failed to be deducted | Equal to the amount failed to be deducted |
| 271D | Contravention of the provisions of S. 269SS; i.e., by taking or accepting any loan or deposit otherwise than by ways specified therein. | Amount of loan or deposit so taken or accepted | Equal to the amount of loan or deposit so taken or accepted |
| 271E | Contravention of S. 269T; i.e. repayment of any deposit otherwise than by modes specified therein. | Amount of deposit so repaid | Equal to the amount of deposit so repaid |
| 271F | Failure to furnish Return of Income under sub-section (1) of S. 139 before the end of the relevant Assessment Year. | -- | Rs. 5,000 |
| Failure to furnish Return of Income under proviso to sub-section (1) of S. 139 by the due date. | -- | Rs. 5,000 | |
| 271G | Failure to furnish information or document u/s. 92D (3). | International transaction | 2 % of such default. |
| 272A(1) | Failure to answer questions, sign statements, attend summons u/s. 131(1), apply for permanent account number u/s. 139A. | -- | Rs. 10,000 |
| 272A(2) | Failure to: | Rs. 100 for every day during which the failure continues. | |
| Comply with notice u/s. 94(6) furnishing information regarding securities | |||
| Give notice of discontinuance of business - S. 176(3) | |||
| Furnish in due time returns, statements, or particulars u/s. 133, 206 or 285B | |||
| Allow inspection of any register(s) - S. 134 | |||
| Furnish returns u/s. 139(4A) | |||
| Deliver in due time a declaration mentioned in S. 197A | |||
| Furnish a certificate u/s. 203. | |||
| Deduct and pay tax u/s. 226(2) | |||
| Furnish returns/ statements/ certificate u/s. 206C | |||
| Furnish a statement of particulars of perquisites and profits in lieu of salary u/s. 192(2C) | |||
| 272AA(1) | Failure to furnish the prescribed information required u/s. 133B (Refer to Form No. 45D). | -- | Rs. 1,000 |
| 272B | Failure to apply for Permanent Account Number (PAN) | -- | Rs. 10,000 |
| 272BB(1) | Failure to apply for Tax Deduction Account No. (TAN) (S. 203A) | -- | Rs. 10,000 |
| 272BBB | Failure to apply for Tax Collection Account No. (TCN) | -- | Rs. 10,000 |
Note:
No penalty is imposable for any failure u/ss. 271(1)(b), 271A, 271AA, 271B, 271BA, 271BB, 271C, 271D, 271E, 271F, 271G, 272A(1)(c) or (d), 272(2), 272AA(1), 272B, 272BB(1) and 272BBB(1), if the person or assessee proves that there was a reasonable cause for such failure (S. 273B).
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