Sections 461 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Sections 461 to 464 are penalty sections for statements and certificates. Section 461 penalises a late or incorrect TDS or TCS statement, and section 462 penalises a failure to furnish, or inaccurate, information about payments to non-residents. Section 463 targets accountants, merchant bankers and registered valuers who give incorrect information in a report or certificate, and section 464 covers research associations, universities, colleges and certain funds. This article follows the text as per the Income-tax Act, 2025 as amended by the Finance Act, 2026. For a notice on any of these, see our legal dispute resolution service.
Section 461: a penalty of not less than Rs. 10,000 but up to Rs. 1,00,000 for a late or incorrect statement under section 397(3)(b), with no penalty for delay if the tax, fee and interest are paid and the statement is delivered within one month of the prescribed time. Section 462: Rs. 1,00,000 for section 397(3)(d) information. Section 463: Rs. 10,000 for each report or certificate containing incorrect information, payable by an accountant, merchant banker or registered valuer. Section 464: Rs. 10,000 to Rs. 1,00,000 for the institutions listed.
Section 461: statements under section 397(3)(b)
Sub-section (1): the penalty
Where a person who is required to deliver, or cause to be delivered, a statement prescribed in section 397(3)(b):
- (a) fails to do so within the time prescribed in that section; or
- (b) furnishes incorrect information in the statement,
the Assessing Officer may impose on that person a penalty of a sum which shall be not less than Rs. 10,000 but which may extend to Rs. 1,00,000. The statement in section 397(3)(b) is explained in our article on section 397.
Sub-section (2): when no penalty is levied for delay
No penalty shall be levied under sub-section (1)(a) for delay in filing or non-filing of the statement if the person proves that:
- the tax deducted or collected, along with the fee and interest, if any, was paid to the credit of the Central Government; and
- the statement was also delivered, or caused to be delivered, before the expiry of one month from the time prescribed in section 397(3)(b).
Sub-section (2) protects only the delay limb, clause (a). It does not mention clause (b), the incorrect-information limb. Both conditions have to be proved.
Example (amounts and dates assumed). Bright Retail Pvt Ltd's statement for a quarter was due on 31 July, and it delivers the statement on 20 August after paying the deducted tax with the fee and interest. It proves both conditions, because 20 August is before the expiry of one month from 31 July. No penalty under clause (a). Had it delivered on 10 September, the one-month condition would fail, and the penalty could be imposed in a sum of at least Rs. 10,000. Separately, the fee for a late statement in section 427 applies; see our article on sections 426, 427, 429 and 430.
Section 462: information under section 397(3)(d)
If any person required to furnish information under section 397(3)(d) (the information relating to payment of a sum to a non-resident who is not a company, or to a foreign company, whether or not chargeable under the Act) fails to furnish it, or furnishes inaccurate information, the Assessing Officer may impose a penalty of Rs. 1,00,000. It is a single fixed amount. The form and manner of the information are as prescribed.
Example (amounts assumed). Skyline Software Pvt Ltd pays a foreign supplier and does not furnish the information about the payment in the manner required by section 397(3)(d). The Assessing Officer may impose Rs. 1,00,000. If the information is furnished but is inaccurate, the same sum applies.
Section 463: incorrect information in reports or certificates
| Sub-section | Rule |
|---|---|
| (1) | Any accountant, merchant banker or registered valuer is liable to pay a penalty of Rs. 10,000 for any incorrect information in any report or certificate furnished under any provision of the Act or the rules made under it |
| (2) | The penalty is payable for each such report or certificate |
| (3) | It is payable on the directions of the Assessing Officer, the Joint Commissioner (Appeals) or the Commissioner (Appeals), where the incorrect information is found by that authority in the course of any proceedings under the Act |
| (4) | "Merchant banker" means a Category I merchant banker registered with the Securities and Exchange Board of India established under section 3 of the Securities and Exchange Board of India Act, 1992 (15 of 1992); "registered valuer" means a person registered as a valuer under section 514 |
Observe three things. The liability is stated as "shall be liable to pay", not "may". The penalty applies to "any provision of this Act or the rules", so it is not limited to one type of report. And the amount is per report or certificate, so three incorrect certificates give three penalties. Check the securities law for the meaning of a Category I merchant banker registration, which the Act refers to but does not explain.
Example (amounts assumed). A registered valuer issues four valuation reports under provisions of the Act. In proceedings the Assessing Officer finds incorrect information in three of them. The penalty is Rs. 10,000 x 3 = Rs. 30,000, payable on the Assessing Officer's directions.
Section 464: statements and certificates by institutions
The Assessing Officer may impose a penalty of not less than Rs. 10,000 but up to Rs. 1,00,000 on:
| Clause | Who | Failure |
|---|---|---|
| (a) | The research association, university, college or other institution referred to in section 45 | Fails to deliver or furnish the documents prescribed under section 45(4)(a) |
| (b) | The institution or fund | Fails to deliver a statement within the time prescribed under section 354(1)(e), or to furnish a certificate prescribed under section 354(1)(g) |
The same failures also attract a daily fee under section 429, as the earlier article explains. The documents, statements and times are those prescribed; they are left to the Income-tax Rules, 2026.
Comparison
| Section | Who | Default | Penalty |
|---|---|---|---|
| 461(1) | Person delivering statement under section 397(3)(b) | Late or incorrect | Rs. 10,000 to Rs. 1,00,000 |
| 461(2) | Same | Delay only | No penalty if tax, fee and interest paid and statement delivered within one month of the prescribed time |
| 462 | Person furnishing information under section 397(3)(d) | Not furnished or inaccurate | Rs. 1,00,000 |
| 463 | Accountant, merchant banker, registered valuer | Incorrect information in report or certificate | Rs. 10,000 per report or certificate |
| 464 | Institutions in section 45 and funds under section 354 | Failure to deliver documents, statement or certificate | Rs. 10,000 to Rs. 1,00,000 |
Section 470 lists sections 461, 462 and 463 among the penalties that need not be imposed where a person proves reasonable cause; see our post on section 470. Section 464 is not in that list. For the next group of penalties see our article on sections 465 to 468.
Need help with a statement or certificate penalty?
A statement penalty can often be avoided by acting inside the one-month window or by correcting errors early, and a professional's certificate penalty depends on the proceedings in which the error is found. Our legal dispute resolution team reviews the facts and prepares the reply.
Key takeaways
- Section 461 penalty is at least Rs. 10,000 and may extend to Rs. 1,00,000 for a late or incorrect statement under section 397(3)(b).
- No penalty for delay if the tax, fee and interest are paid and the statement is delivered within one month of the prescribed time.
- Section 462 imposes Rs. 1,00,000 for failure or inaccuracy in section 397(3)(d) information.
- Section 463 imposes Rs. 10,000 per incorrect report or certificate on an accountant, merchant banker or registered valuer.
- Section 464 imposes Rs. 10,000 to Rs. 1,00,000 on the institutions and funds listed.
- Section 470 covers sections 461 to 463, but not 464, in its reasonable cause rule.
Read next
- Sections 465 to 468: penalties for failure to answer questions, furnish information and comply with sections 254, 262 and 397
- Sections 456 to 460: penalties for reporting failures by investment funds, Indian concerns and international groups
- Section 397: compliance and reporting
- Section 470: the reasonable cause defence
Disclaimer: Based on the Income-tax Act, 2025 (30 of 2025) as amended by the Finance Act, 2026, as consulted on 2 October 2026. It explains the words of the Act only; the Income-tax Rules, 2026, notifications, circulars, later amendments and the way the tax authorities and courts apply these provisions should be checked. This article is general information, not legal advice; check the official text before acting.