The Income Tax Department has already given a warning regarding this. If any person is found involved in such work, then the IT department will charge a fine from him. In case of tax evasion, penalty can be imposed on the total amount saved from tax. Many times a taxpayer tries to reduce the tax liability by under-reporting or misrepresenting the income, then on the basis of section 270A, the taxpayer will be held liable for penalty.
Know that under the Income Tax Act, penalty is imposed for various defaults committed by the taxpayer. Apart from penalties for non-payment of self-assessment tax, default in payment of tax, default in filing income return and others, the Income Tax Department also imposes penalty for underreporting and misreporting of income.
Department takes strict action
According to the IT department, a penalty of 50 to 200 percent can be imposed on the total amount saved from tax. According to section 270A, if wrong information is given in the income tax return, then 200 percent penalty can be imposed on the tax liability or hidden amount. On the other hand, if the separate income has been declared less due to some other reasons, then there will be a penalty of 50 percent on the liability or hidden amount. Not only this, the department has said that the employer of such taxpayers will also be informed that the person working for them is filing wrong income tax return.
All these things are included in the case of misrepresentation of income.
misrepresentation or concealment
Failure to provide accurate record of investment
Exaggerated the deduction but could not provide proof
Any false entry in the account books
concealment of record of any international or specific transaction