Income Tax Act 1961 Section 271GA

Income Tax Act Section 271GA deals with penalties related to the late filing of Tax Deducted at Source (TDS) statements. It specifies monetary consequences for deductors who fail to submit TDS returns within the prescribed due dates. This section is crucial for deductors, tax professionals, and businesses to ensure timely compliance and avoid penalties.

Understanding Section 271GA helps taxpayers and organizations maintain proper documentation and meet statutory deadlines. It promotes transparency and accountability in tax deduction and collection processes, safeguarding government revenue.

Income Tax Act Section 271GA – Exact Provision

This section imposes a daily penalty of ₹100 for each day of delay in filing TDS statements beyond the due date. The penalty is levied by the Assessing Officer and continues until the statement is filed. It aims to enforce timely compliance and reduce delays in tax administration.

• Penalty applies per day of delay after the due date.

• Penalty amount is ₹100 per day.

• Applies to persons required to file TDS statements.

• Penalty is imposed by the Assessing Officer.

• Encourages prompt filing of TDS returns.

Explanation of Income Tax Act Section 271GA

This section mandates a penalty for late filing of TDS statements under Section 200(3). It applies to all deductors responsible for submitting TDS returns.

• States penalty for failure to file TDS statements on time.

• Applicable to individuals, companies, firms, and other deductors.

• Penalty triggers after the prescribed due date lapses.

• Penalty amount is fixed at ₹100 per day of delay.

• Penalty continues until the statement is filed.

Purpose and Rationale of Income Tax Act Section 271GA

The section aims to ensure timely submission of TDS statements, which are critical for tax credit and verification. It discourages delays that hamper tax administration and revenue collection.

• Promotes punctual compliance with TDS filing deadlines.

• Prevents revenue leakage due to delayed reporting.

• Encourages deductors to maintain proper records.

• Supports efficient tax credit processing for deductees.

When Income Tax Act Section 271GA Applies

Section 271GA applies when a deductor fails to file the TDS statement within the prescribed time under Section 200(3). It is relevant for every financial year and corresponding assessment year.

• Triggered after the due date for TDS statement filing.

• Applies to all deductors required to file TDS returns.

• Relevant for all types of TDS payments and deductions.

• Applicable regardless of the amount of tax deducted.

Tax Treatment and Legal Effect under Income Tax Act Section 271GA

The penalty under Section 271GA is a monetary fine and does not affect the tax liability itself. It is a compliance-related penalty to enforce timely filing of TDS statements.

The penalty amount is added as a liability but does not reduce taxable income or tax payable. It is separate from interest or other penalties under the Act.

• Penalty is a monetary fine, not a tax deduction.

• Does not affect computation of total income.

• Separate from interest on late TDS payment.

Nature of Obligation or Benefit under Income Tax Act Section 271GA

This section creates a compliance obligation for deductors to file TDS statements timely. Failure results in a mandatory penalty. It benefits the tax system by ensuring accurate and prompt reporting.

Deductors must comply to avoid penalties. The obligation is mandatory and continuous until filing is complete.

• Creates mandatory compliance duty for deductors.

• Penalty applies automatically on delay.

• No exemption from penalty unless filing is done.

• Benefits government revenue and deductees.

Stage of Tax Process Where Section Applies

Section 271GA applies at the TDS statement filing stage, which follows tax deduction and payment. It impacts compliance during return submission and assessment.

• After tax deduction and payment.

• At the stage of filing quarterly or periodic TDS statements.

• Before or during assessment proceedings.

• Non-compliance can trigger penalty notices.

Penalties, Interest, or Consequences under Income Tax Act Section 271GA

The penalty under Section 271GA is ₹100 per day of delay. It is independent of interest payable under other sections for late payment of TDS.

Non-compliance can lead to increased scrutiny and further penalties. Persistent default may attract prosecution under other provisions.

• ₹100 per day penalty for late filing.

• Penalty continues until statement is filed.

• Separate from interest on late TDS payment.

• May lead to further legal action if defaults persist.

Example of Income Tax Act Section 271GA in Practical Use

Assessee X, a company, deducted TDS on salaries for the quarter ending June 2025. The due date for filing the TDS statement was 31 July 2025. However, the company filed the statement on 15 August 2025, 15 days late. Under Section 271GA, the Assessing Officer levied a penalty of ₹1,500 (₹100 x 15 days) for the delay.

This penalty encourages timely filing and helps maintain compliance records.

• Penalty calculated based on days delayed.

• Encourages prompt filing of TDS statements.

Historical Background of Income Tax Act Section 271GA

Section 271GA was introduced to strengthen compliance with TDS filing requirements. It was inserted by the Finance Act, 2017, to deter late submissions and improve tax administration.

Since its introduction, amendments have clarified penalty procedures and limits. Judicial interpretation has reinforced the section’s role in enforcing timely compliance.

• Introduced by Finance Act 2017.

• Amended for clarity and enforcement.

• Supported by judicial rulings on penalty imposition.

Modern Relevance of Income Tax Act Section 271GA

In 2026, with digital TDS return filing and faceless assessments, Section 271GA remains vital. It ensures deductors adhere to deadlines in an increasingly automated tax environment.

Digital compliance tools and AIS reports help monitor delays. The section supports government efforts to streamline tax collection and reduce manual interventions.

• Supports digital TDS return filing compliance.

• Relevant for faceless assessment processes.

• Encourages timely electronic submissions.

Related Sections

• Income Tax Act Section 200 – Deduction and collection of tax at source.

• Income Tax Act Section 201 – Consequences of failure to deduct or pay TDS.

• Income Tax Act Section 234E – Fee for delay in furnishing TDS/TCS statements.

• Income Tax Act Section 271C – Penalty for failure to deduct tax at source.

• Income Tax Act Section 273B – Waiver of penalty.

• Income Tax Act Section 276B – Prosecution for failure to pay TDS.

Case References under Income Tax Act Section 271GA

No landmark case directly interprets this section as of 2026.

Key Facts Summary for Income Tax Act Section 271GA

• Section: 271GA

• Title: Penalty for Late Filing of TDS Statements

• Category: Penalty, Compliance

• Applies To: Deductors required to file TDS returns

• Tax Impact: Monetary penalty of ₹100 per day of delay

• Compliance Requirement: Timely filing of TDS statements

• Related Forms/Returns: TDS Returns (Form 24Q, 26Q, etc.)

Conclusion on Income Tax Act Section 271GA

Section 271GA plays a critical role in enforcing timely filing of TDS statements. By imposing a daily penalty, it motivates deductors to comply with statutory deadlines and maintain accurate tax records. This helps the government ensure proper tax credit to deductees and smooth functioning of the tax system.

For businesses and professionals, understanding and adhering to Section 271GA is essential to avoid unnecessary penalties. Timely filing not only prevents financial loss but also supports transparent tax administration and compliance culture in India.

FAQs on Income Tax Act Section 271GA

What is the penalty under Section 271GA?

The penalty is ₹100 for every day of delay in filing the TDS statement after the due date. It continues until the statement is filed.

Who is liable to pay the penalty under Section 271GA?

Any person or deductor required to file TDS statements who fails to file within the prescribed time is liable to pay the penalty.

Does the penalty under Section 271GA affect the tax deducted?

No, the penalty is separate and does not affect the amount of tax deducted or payable. It is a fine for late filing only.

Can the penalty under Section 271GA be waived?

Yes, under certain circumstances, the Assessing Officer may waive the penalty under Section 273B if there is a reasonable cause for delay.

When does Section 271GA apply?

It applies when a deductor fails to file the TDS statement within the due date prescribed under Section 200(3) of the Income Tax Act.