Chapter XXIwas s.271FAB

Section 456 of the Income-tax Act, 2025

Section 456 — Penalty for failure to furnish statement or information or document by an eligible investment fund. Successor to s.271FAB of the 1961 Act.

Where this section sits

Section 456 is in Chapter XXI — Penalties, which runs from section 439 to section 472.

← Section 455 · Section 457 →

What this section does

The section provides that if an eligible investment fund required to furnish a statement, or any information or document, under paragraph 4 of Schedule I fails to do so within the time prescribed under that paragraph, the income-tax authority prescribed under that paragraph may direct that the fund shall pay, by way of penalty, a sum of Rs. 500000.

Why it is there

The concession available to an eligible investment fund depends on facts the Department can only learn from the fund itself, and the reporting obligation in paragraph 4 of Schedule I is how it learns them. A fixed penalty attaches a definite cost to silence, without requiring any measurement of the tax at stake.

Who it applies to

An eligible investment fund required to furnish a statement, information or document under paragraph 4 of Schedule I
The income-tax authority prescribed under that paragraph, who may direct payment of 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
Penalty for failure to furnish the statement, information or document	Rs. 500000	Failure by an eligible investment fund to furnish it within the time prescribed under paragraph 4 of Schedule I; the prescribed income-tax authority may direct payment	Section 456

What this means in practice

The penalty is a fixed sum, not a per-day or proportionate charge, so it does not grow with the length of the delay or the size of the fund. The trigger is failure to furnish within the prescribed time, so a late filing is a failure unless it is within that time. The power is expressed as one the authority "may" exercise, so the direction is discretionary, and it is the authority prescribed under paragraph 4 of Schedule I, not any income-tax authority, who exercises it.

An example

Illustrative only, and invented for this page. The figures are chosen to show the rule biting, not taken from any real matter.

An eligible investment fund does not file the statement required by paragraph 4 of Schedule I within the time prescribed there, and files it four months late. The prescribed income-tax authority may direct it to pay Rs. 500000 by way of penalty — the same amount whether the delay was four months or four days beyond the prescribed time, since the section fixes a single sum.

Where you meet this section

The fund meets it as a direction from the income-tax authority prescribed under paragraph 4 of Schedule I requiring payment of the penalty, following its failure to file the statement, information or document that paragraph requires.

The words themselves

may direct that such fund shall pay, by way of penalty, a sum of Rs. 500000

Section 456, Income-tax Act, 2025.

What people get wrong

Treating the penalty as running per day of delay. The section fixes a single sum of Rs. 500000.
Assuming any income-tax authority may levy it. The section names the income-tax authority prescribed under paragraph 4 of Schedule I.
Reading the penalty as automatic. The section says the authority may direct payment, so the levy is discretionary.

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.

271FAB - Penalty for failure to furnish statement or information or document by an eligible investment fund

See the full 1961 to 2025 concordance.

Read with

Schedule I

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.