Section 271F of ITA, 1961 : Section 271F: Penalty For Failure To Furnish Return Of Income

Explanation using Example

Imagine Mr. Sharma, a salaried employee, who had to file his income tax return for the financial year 2016-17 (Assessment Year 2017-18) by the due date of July 31, 2017, as per Section 139(1) of the Income-tax Act, 1961. However, Mr. Sharma forgot to file his return within the stipulated time and also missed the deadline of March 31, 2018, which is the end of the relevant assessment year.

The Income Tax Department, upon realizing this, may issue a notice to Mr. Sharma. The Assessing Officer handling his case has the authority to impose a penalty under Section 271F for non-filing of the income tax return. Consequently, Mr. Sharma may be directed to pay a penalty of five thousand rupees for his failure to furnish the return before the end of the assessment year 2017-18.

However, it's important to note that this provision of imposing a penalty under Section 271F would not be applicable for any returns that were to be filed for the assessment year starting from April 1, 2018, onwards.