Sections 465 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 465 to 468 collect the penalties for failures of procedure: not answering questions, not attending a summons, not furnishing returns and statements, not allowing inspection of registers, not complying with section 254, and breaches of the rules on Permanent Account Numbers, Aadhaar numbers and Tax Deduction and Collection Account Numbers. This article follows the text as per the Income-tax Act, 2025 as amended by the Finance Act, 2026, which changed section 466 (the ceiling) and the heading of section 467 (sections 104 and 105 of that Act). For a notice on any of these, see our legal dispute resolution service.
Section 465(1): Rs. 10,000 for each default such as refusing to answer, refusing to sign, ignoring a summons or a notice. Section 465(2): Rs. 500 for every day for thirteen listed failures, including late returns and statements. Section 466: a penalty that may extend up to Rs. 25,000 for not complying with section 254. Section 467: Rs. 10,000 for failures under section 262 (PAN and Aadhaar). Section 468: Rs. 10,000 for failure to comply with section 397 or for quoting a false TAN.
Section 465(1): Rs. 10,000 for each default
A person is liable to pay a penalty of Rs. 10,000 for each default or failure if he:
| Clause | Default |
|---|---|
| (a) | Being legally bound to state the truth of any matter touching the subject of his assessment, refuses to answer any question put to him by an income-tax authority in the exercise of its powers |
| (b) | Refuses to sign any statement made by him in the course of any proceedings, which an income-tax authority may legally require him to sign |
| (c) | Is issued a summons under section 246(1) to attend to give evidence or to produce books of account or other documents at a certain place and time, and omits to attend or produce them |
| (d) | Fails to comply with a notice under section 268(1) or 270(8), or with a direction issued under section 268(5) |
For the summons powers see our post on section 246.
Example (amounts assumed). Dinesh is summoned under section 246(1) to attend and produce books of account on a fixed date and does not. He also fails to comply with a notice under section 268(1). That is two defaults and the penalty is Rs. 10,000 x 2 = Rs. 20,000.
Section 465(2): Rs. 500 for every day
A person is liable to pay a penalty of Rs. 500 for every day during which any of the following failures continue, if he fails to:
| Clause | Failure |
|---|---|
| (a) | Comply with a notice under section 175(7) |
| (b) | Give notice of discontinuance of his business or profession as required by section 320(3) |
| (c) | Furnish in due time any of the returns, statements or particulars mentioned in section 252, 397(3) or 507 |
| (d) | Allow inspection of any register referred to in section 255, or of any entry in it, or allow copies to be taken |
| (e) | Furnish the return of income as required under section 263(1)(a)(iii) or (iv), or furnish it within the time allowed and in the manner required under section 263(1) and (2) |
| (f) | Deliver in due time a copy of the declaration required under section 393(7) |
| (g) | Furnish a certificate under section 395(4) |
| (h) | Deduct and pay tax under section 416(3) |
| (i) | Furnish a statement under section 392(5)(a) |
| (j) | Deliver in due time a copy of the declaration required under section 394(3) |
| (k) | Deliver the statement within the time specified in section 397(3)(b) |
| (l) | Deliver a statement within the time as may be prescribed under section 397(3)(e) |
| (m) | Deliver a statement within the time as may be prescribed under section 397(3)(g)(i) |
The clauses on a late return, (e), and on late TDS statements, (k) to (m), are the ones most often met. The provisions behind clause (i) and the declarations in clauses (f) and (j) are in sections 392 to 394; see our posts on section 392 and section 393.
Sub-sections (3) to (5)
| Sub-section | Rule |
|---|---|
| (3) | The penalty shall not exceed the amount of tax deductible or collectible for failures in relation to (a) a declaration under section 393(7); (b) a certificate under section 395(4); and (c) statements under section 397(3)(b) or (e) |
| (4) | Penalty under sub-section (1) or (2) is imposed (a) if the default occurs in a proceeding before an income-tax authority not below the rank of Joint Director or Joint Commissioner, by that authority; (b) in a case under sub-section (1)(d), by the authority that issued the notice or direction; (c) in a case under sub-section (2)(f), by the Principal Chief Commissioner, Chief Commissioner, Principal Commissioner or Commissioner; (d) in any other case, by the Joint Director or Joint Commissioner |
| (5) | "Income-tax authority" includes a Principal Director General, Director General, Principal Director, Director, Joint Director, Assistant Director or Deputy Director while exercising the powers of a court under the Code of Civil Procedure, 1908 (5 of 1908) when trying a suit in respect of the matters specified in section 246(1) |
Example (days and amounts assumed). Coastal Foods Pvt Ltd delivers its TDS statement 30 days after the time in section 397(3)(b). Under clause (k) the penalty is Rs. 500 x 30 = Rs. 15,000, but sub-section (3)(c) limits it to the tax deductible or collectible. If the tax deductible was Rs. 9,000, the penalty is Rs. 9,000. The daily fee in section 427 is a separate provision.
Section 466: failure to comply with section 254
If a person fails to comply with section 254, the Joint Commissioner, Deputy Director, Assistant Director or the Assessing Officer may impose a penalty which may extend up to Rs. 25,000. The ceiling of Rs. 25,000 was substituted by the Finance Act, 2026, with effect from 1 April 2026. Section 254 itself is not explained here; read it for the duty.
Section 467: sections 262 and 397
The heading of section 467 reads "sections 262 and 397", substituted by the Finance Act, 2026 (section 105 of that Act) for "section 262". The text of section 467 as printed is about section 262 only.
| Sub-section | Failure | Penalty |
|---|---|---|
| (1) | A person fails to comply with the provisions of section 262 | The Assessing Officer may impose Rs. 10,000 |
| (2) | A person required to quote or intimate his PAN or Aadhaar number in a document as referred to in section 262(9)(a) provides, quotes or intimates a number which is false, knowing or believing it to be false | Rs. 10,000 for each such default |
| (3) | A person fails to quote or authenticate his PAN or Aadhaar number in a document referred to in section 262(9)(a) | Rs. 10,000 for each such default |
| (4) | A person referred to in section 262(9)(b) responsible for ensuring the correct quoting or authentication of PAN or Aadhaar number in documents relating to transactions prescribed under section 262(9)(a) fails to do so | Rs. 10,000 for each such default |
The words in sub-section (2) require knowledge or belief that the number is false; an honest error would not meet that test. Sub-sections (3) and (4) have no knowledge test. The documents and transactions are those prescribed; the detail is left to the Income-tax Rules, 2026.
Example (amounts assumed). A buyer quotes a PAN she knows to be false in a prescribed document. Under sub-section (2): Rs. 10,000. In a different transaction she fails to quote any PAN or Aadhaar number in a document within section 262(9)(a): sub-section (3) gives another Rs. 10,000 for that default. Ms. Rao, a person responsible under section 262(9)(b) for correct quoting, fails to ensure it in two documents: sub-section (4) gives Rs. 10,000 x 2 = Rs. 20,000.
Section 468: section 397
| Sub-section | Failure | Penalty |
|---|---|---|
| (1) | A person fails to comply with the provisions of section 397 | The Assessing Officer may impose Rs. 10,000 |
| (2) | A person required to quote his TAN in challans, certificates, statements or other documents referred to in section 397(1)(b) quotes a number which is false, knowing or believing it to be false or not true | Rs. 10,000 |
Our article on section 397 explains the duties to which section 468 attaches.
Reasonable cause
Section 470 lists section 465(1)(c), 465(1)(d), all of 465(2), 466, 467 and 468 for the reasonable cause rule, but not 465(1)(a) or (b); see our post on section 470.
Comparison
| Section | Amount | Measure |
|---|---|---|
| 465(1) | Rs. 10,000 | Each default |
| 465(2) | Rs. 500 | Each day of failure; capped at tax in some cases |
| 466 | Up to Rs. 25,000 | Per failure to comply with section 254 |
| 467 | Rs. 10,000 | Each default under section 262 |
| 468 | Rs. 10,000 | Failure under section 397; false TAN |
Need help with procedural penalties?
These penalties arise from missed notices, late returns and number errors, and several can attach to the same set of facts. Our legal dispute resolution team reads the notice, matches it to the clause and prepares a reply, including a reasonable cause claim where section 470 allows it.
Key takeaways
- Rs. 10,000 for each default under section 465(1): refusal to answer or sign, ignoring a summons, ignoring a notice or direction.
- Rs. 500 a day for thirteen failures in section 465(2), capped at the tax deductible or collectible in the three cases in sub-section (3).
- Section 466 allows a penalty up to Rs. 25,000 for not complying with section 254.
- Section 467 imposes Rs. 10,000 per default for PAN and Aadhaar failures, and a false number needs knowledge or belief.
- Section 468 imposes Rs. 10,000 for non-compliance with section 397 and for a false TAN.
- Section 470 covers most of these but not 465(1)(a) and (b).
Read next
- Section 469: power to reduce or waive penalty
- Sections 461 to 464: penalties for statements, information and incorrect reports or certificates
- Section 470: the reasonable cause defence
- Section 246: summons powers
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.