The Central Government has over the period moved its focus more on voluntary compliance. Certain certificates and certification of reports by a qualified professionals have been provided in the Act to ensure that the information furnished by an assessee under all the respective provisions of the Act is authentic and correct.
Existing Provisions For Furnishing of Incorrect Information
However, various provisions exist to penalize and punish those defaulting assessees who furnish wrong information. But till now there are no provisions exist in the act by which an Assessing Officer or a Commissioner could levy any kind of penalty for wrong certificates, from the responsible assessee.
Section 271J – Penalty for wrong certificates
But this penalizing process may change soon. In order to attract the assessee’s attention so that he takes proper look over the requirements of the desired certificates or reports before furnishing, a Section 271J has been proposed.
This section provides that if an accountant or a merchant banker or a registered valuer, furnishes incorrect information in a report or certificate under any provisions of the Act or the rules made there under, then he may be directed by the Assessing Officer or Commissioner to pay an amount as penalty for wrong certificates and reports. This will be calculated as ten thousand for each such wrong reports or certificates.
Chartered Accountant must prove reasonable cause for default in Certificate issued to escpae Penalty under Section-271J
Moreover, it is also proposed to correctly define the terms “accountant”, “merchant banker” and “registered valuer“ as per the requirements of the law before the introduction of this section officially.
Furthermore, it is also suggested to amend the section 273B to that if the assessee proves that there is a certainly reasonable cause for the failure of proper furnishing of certificates or certification of reports, then he won’t be levied any such penalty for wrong certificates with respect to the proposed section 271J. All these amendments will come into effect from April 1st, 2017.
ALSO READ: Your ultimate guide for CA campus interviews