New Provision
Section 445, IT Act 2025
Replaces (IT Act 1961)
271AAE
Chapter
Chapter XX — Penalties
Effective From
1 April 2026
Statutory Text — Section 445
during any proceedings under this Act, it is found that a person being a registered non-profit organisation has any specified income which is chargeable to tax as per section 337 (Table: Sl. No. 2), the Assessing Officer may impose on such person, a penalty of— (a) a sum equal to the aggregate amount of income applied, directly or indirectly, by such person, for the benefit of any related person referred to in section 355(h), if the violation is noticed for the first time during any tax year; and (b) a sum equal to 200% of the aggregate amount of income of such person applied, directly or indirectly, by that person for the benefit of any person referred to in section 355(h), if the violation is noticed again in any subsequent tax year.
Shahi & Co. — Our Understanding
This section falls under Chapter XX which prescribes penalties for various non-compliances under the Act.
Practical Note: Penalties under the Income Tax Act can be significant — often ranging from 50% to 200% of the tax amount involved. Voluntary disclosure and prompt correction of errors significantly reduces penalty exposure.
Shahi & Co., Chartered Accountants
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Disclaimer: This is a reproduction of Section 445 of the Income Tax Act, 2025 (No. 30 of 2025) as published in the Official Gazette of India (CG-DL-E-22082025-265620) for informational and reference purposes only. Shahi & Co., Chartered Accountants makes no warranty as to completeness or accuracy. For the official authenticated text refer to
egazette.gov.in or
incometaxindia.gov.in. This does not constitute legal or tax advice.