Tougher penalties for serious tax offences proposed !
Not paying your taxes in time could soon result in heftier fines and longer prison sentences if proposals being considered by the income-tax department are any indication. According to sources, as part of its proposed restructuring of penalties for tax-related offences, the department is planning to scale down the punishment for minor offences, while at the same time increasing penal provisions for major offences.
Failure to pay tax is punishable under section 276 (B) of the Income-Tax Act, 1961.
Commenting on the proposals, a tax official said, “The threat of long imprisonment may create some amount of fear and induce evaders to pay their taxes.” Up until now, there have been very few cases that have led to prosecution and imprisonment of offenders following investigations carried out by the department, the official pointed out.
That’s where the carrot-and-stick approach being considered by the department comes in. By reducing the penalty and length of imprisonment for some minor offences, it hopes to hasten prosecution of more serious offences and dispose of these cases faster.
The department is also pitching for judicial reforms on another front. In cases where documentary evidence is available, the department wants the assessing officer or any other tax official that may be involved to be exempt from physically appearing as a witness. This is because many cases drag on for years and even after a tax official retires, he is often called upon as a witness by the court.
If the department’s proposals are implemented, the changes could be reflected in the Direct Tax Code, sources said. The issue was also discussed at the income-tax chief commissioner’s conference held last month under the agenda ‘Launching prosecution and compounding offences—an effective mechanism for deterrence’.
News posted by
CCI News Desk
Finance news reporter covering taxation, GST, income tax, business compliance, and economy updates. I simplify complex financial topics into easy-to-understand articles for professionals, taxpayers, and business owners on leading finance and tax platforms.
Recent News :
- Tax Audit Deadline 2026: Professional Bodies Seek Extension to 31st October
- GSTN Announces emSigner 3.3 for New DSC USB Tokens Issued From 21st September 2026
- UPI 0.4% MDR Above Rs 2000: Grocery Shop Sign Sparks Fresh Debate
- India's STT Collections Rise 52.9% to Rs 40,214 Crore by 17th Sept 2026
- India to Monitor UPI MDR Charges to Protect Consumers from Extra Costs
- Central GST Superintendent Arrested in Bengaluru Over Alleged Rs 8 Lakh Bribe
- CBDT Revises Form 169 and Form 171 Under Income Tax Rules 2026
- Supreme Court PIL Challenges New UPI Merchant Charges Above Rs 2000
- MTPA Seeks Tax Audit Deadline Extension: TAR by 31st Oct, ITR by 30th Nov 2026
- AIMTPA Seeks Tax Audit & ITR Due Date Extension for AY 2026-27
Popular News
- AIMTPA Seeks Tax Audit & ITR Due Date Extension for AY 2026-27
- MTPA Seeks Tax Audit Deadline Extension: TAR by 31st Oct, ITR by 30th Nov 2026
- Tax Audit Deadline 2026: Professional Bodies Seek Extension to 31st October
- CBDT Notifies SFT Rules for Depository Transactions Under Income Tax Act 2025
- CBDT Notifies SFT Reporting Rules for Mutual Fund Transactions by RTAs Under IT Act 2025
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
