time limit for AO to pass penalty order u/s 271A

Section 275 provides the period of limitation beyond which order of penalty u/s 271(1)© cannot be passed.

Sub section (1) of this section provides that where the relevant assessment order or other order is the subject matter of appeal to the CIT(A) or ITAT then, order of penalty can not be passed after the expiry of the FY in which the proceedings, in the course of which action for imposition for penalty has been initiated, are completed, or six months from the end of month in which the order of CIT(A) or the Tribunal is received by the Chief comm. or the Comm. , whichever period expires later.

A proviso has been added wef 1.6.2003. it provides that where order of assessment or other order is subject matter of appeal before CIT (A) and CIT (A) passes an order after 1.6.2003 then, order of penalty can not be passed after the expiry of the FY in which the proceedings, in the course of which action for imposition for penalty has been initiated, are completed, or six months from the end of month in which the order of CIT(A) is received by the Chief comm. or the Comm. , whichever is later.

Sub section (b) provides that where assessment or other order is subject matter of revision u/ 263/364, penalty order shall not be passed after the expiry of six months from the end of of the month in which order of revision is passed.

Sub section (c) of provides that in any other case, penalty order shall not be passed after the expiry of the FY in which the proceedings, in the course of which action for imposition for penalty has been initiated, are completed, or six months from the end of month in which action for imposition of penalty is initiated, whichever period expires later.

Refer: https://www.itatonline.org/articles_new/penalty-us-2711c-a-comprehensive-analysis-k-c-singhal-advocate/