One sentence. If any person fails to collect the whole or any part of the tax as required under Chapter XIX-B, the Assessing Officer may impose on him a penalty equal to the tax which he failed to collect.
Why it is there
Collection at source depends on the collector actually collecting, and the Act needs a sanction for the failure that is not merely the recovery of the tax itself. Fixing the penalty at the amount not collected makes the failure cost the collector the sum he should have taken.
Who it applies to
Any person required to collect tax at source under Chapter XIX-B who fails to collect the whole or any part of it
The Assessing Officer imposing the penalty
The figures, and what each one turns on
Read the condition in the same row. A figure quoted without it is a wrong answer with a citation attached.
What
Figure
The condition on it
Where
Amount of penalty
A sum equal to the tax which the person failed to collect
Failure to collect the whole or any part of the tax as required under Chapter XIX-B; the imposition is in the Assessing Officer's discretion — the section says "may impose"
Section 449
What this means in practice
The penalty is measured by the tax not collected, and a partial failure attracts a penalty equal to that part — the words are "the whole or any part". The power is discretionary in its exercise but fixed in its amount: the section says the Assessing Officer "may impose", and where he does, the figure is not a range but an amount equal to the tax not collected. Nothing in this section deals with the collector's separate liability to pay the tax or interest; it creates only the penalty for the failure to collect.
An example
Illustrative only, and invented for this page. The figures are chosen to show the rule biting, not taken from any real matter.
A person required under Chapter XIX-B to collect Rs. 4 lakh of tax at source during a year collects only Rs. 1.5 lakh. He has failed to collect Rs. 2.5 lakh, and the Assessing Officer may impose a penalty of Rs. 2.5 lakh — an amount equal to the part not collected — under this section.
Where you meet this section
You meet it as a penalty order, usually preceded by a show cause notice, after a default is identified in the tax collection at source statements filed for the period.
The words themselves
the Assessing Officer may impose on him, a penalty equal to the tax which such person failed to collect
Section 449, Income-tax Act, 2025.
What people get wrong
Assuming the penalty falls only on a total failure. It applies to a failure to collect the whole or any part of the tax.
Reading the amount as a maximum. The section fixes the penalty at a sum equal to the tax not collected; it is the imposition, not the amount, that is discretionary.
Treating payment of the uncollected tax as an answer to the penalty. This section imposes a penalty for the failure to collect and says nothing about the tax or interest liability.
What this replaced
The correspondence is the Income Tax Department’s own, from its comparison utility for the 1961 and 2025 Acts. A renumbering is the easy half; whether the words changed is the half that decides cases.
271CA - Penalty for failure to collect tax at source
Read this before you rely on it. Every decision below was decided under the Income-tax Act, 1961. It appears here because it is tagged to a 1961 provision that the department’s own mapping carries to section 449. That is an inference we have drawn, not a holding on the new section: where the words changed in the move, the reasoning may not survive. Treat this as the place to start looking, not as authority on the 2025 Act.
Explainers
TCS basicstagged s.271CA What is TCS, which of my sales attract it, and how is it different from deducting TDS?
Read with
Chapter XIX-B
What this page does not tell you. It does not reproduce the section. Everything above was written from the section’s own text as the Income Tax Department publishes it — the text is here, and nothing here is advice on your facts. Where a figure matters, read the sub-section it comes from.