Penalties Section 271(1)(c) — Penalty for Concealment of Income (Legacy)
Section 271(1)(c) — Penalty for Concealment of Income (Legacy)
Income Tax Act 1961 — 271(1)(c)
The Penalty
100% to 300% of tax sought to be evaded
- Cap
- 300% of tax sought to be evaded
- Calculation base
- Tax sought to be evaded on the concealed / inaccurately-reported income
- Period
- One-time per assessment.
When does this apply?
AO finds that particulars of income were concealed or inaccurate particulars were furnished (up to AY 2016-17).
Calculate this amount
This estimate applies only the rate and caps published in the authored rule for this page.
Worked examples
| Scenario | Calculation | Result |
|---|---|---|
| Tax sought to be evaded ₹5,00,000 — AO levies minimum | 100% × ₹5,00,000 | ₹5,00,000 |
| Tax sought to be evaded ₹5,00,000 — AO levies maximum for wilful concealment | 300% × ₹5,00,000 | ₹15,00,000 |
How it is levied
AO must record satisfaction in the assessment order and issue notice u/s 274 before levy. The Bombay HC and SC have repeatedly held that vague charge-of-particulars (concealment vs. inaccurate particulars) vitiates the penalty.
For AY 2017-18 onwards, s.270A applies instead. Do not cite s.271(1)(c) as live law for current-year defaults; use s.270A. Legacy litigation on older AYs still runs under s.271(1)(c).