We have raised Paidup share capital in our Private limited company from X amount to Y amount through Right issue to existing share holders (total 4 shareholders only) who are family member
We missed filling SFT for it and our new CA is saying there is Rs 500 penalty everyday and 1000 per day after 30 days
And we are 400 days late so around 3.85 lac penalty is due
Is there any condolence possible or is there any upper limit to this penalty
Hi Bhumit,
Regarding the SFT (Statement of Financial Transactions) filing under Section 285BA (Form 61A) and penalties for late filing:
The Income Tax Act prescribes a penalty of ₹500 per day for each day of default.
After 30 days, the penalty increases to ₹1000 per day.
There is no specific upper limit or cap mentioned in the law on this penalty.
So, theoretically, the penalty can accumulate indefinitely.
The penalty is discretionary and can be waived or reduced if you appeal and demonstrate reasonable cause or genuine difficulties.
Courts and tribunals have, in some cases, granted relief if the delay was unintentional and steps were taken to comply promptly after discovering the lapse.
You can apply for condonation of delay or file an appeal against the penalty demand, explaining your situation.
Since it’s a family-only rights issue, and the amount of shares involved might be small, this might support your case.
File the pending SFT (Form 61A) immediately — even delayed filing may help reduce the penalty burden.
Approach the Assessing Officer or CPC with a request for condonation of delay.
Get professional help to draft a representation explaining the reasons for the delay.
Keep evidence of the genuine steps taken and reasons why the delay was unavoidable.
Penalty can be huge without any fixed cap.
Relief/condonation possible on merits — not automatic, but worth trying.
Immediate action to file and represent can help.
CAclubindia
