Section 466 — Penalty for failure to comply with the provisions of section 254. Successor to s.272AA of the 1961 Act.
Section 466 is in Chapter XXI — Penalties, which runs from section 439 to section 472.
A single sentence: where a person fails to comply with the provisions of section 254, the Joint Commissioner, Deputy Director, Assistant Director or Assessing Officer may impose a penalty of up to Rs. 25,000 on him. The ceiling was raised from Rs. 1,000 to Rs. 25,000 by Act No. 4 of 2026 with effect from 1 April 2026.
It backs the section 254 obligation with a monetary sanction, and the twenty-five-fold increase in the ceiling from 1 April 2026 shows the earlier amount was no longer a deterrent.
| What | Figure | The condition on it | Where |
|---|---|---|---|
| Maximum penalty for failure to comply with section 254 | Rs. 25,000 | An upper limit, not a fixed amount — the penalty 'may extend up to' it; substituted for Rs. 1,000 by Act No. 4 of 2026 with effect from 1 April 2026 | S.466 |
The penalty is discretionary and capped, so the officer may impose any amount up to Rs. 25,000; the section fixes no minimum. Four different authorities can impose it, which means the notice may not come from the Assessing Officer. The reasonable cause defence in section 470 expressly covers section 466, so proving reasonable cause for the failure prevents any penalty being imposed.
An income-tax authority enters a firm's business premises under section 254 during business hours and requires an employee attending there to furnish the prescribed information; nothing is furnished. The Joint Commissioner may impose a penalty, but Rs. 25,000 is a ceiling and not the charge — the section says the penalty 'may extend up to' that amount, so a smaller sum can be imposed. The figure is also recent: Rs. 25,000 was substituted for Rs. 1,000 by Act No. 4 of 2026 with effect from 1 April 2026, so an earlier default carries the old maximum. And no penalty at all follows if reasonable cause for the failure is proved, section 470 naming section 466 among the provisions it protects.
In a penalty order of the Joint Commissioner, Deputy Director, Assistant Director or Assessing Officer, and in the show-cause preceding it, after an entry under section 254 at which the information required was not furnished.
If a person fails to comply with the provisions of section 254, the Joint Commissioner, Deputy Director or Assistant Director or the Assessing Officer, may impose a penalty which may extend up to Rs. 25000 on him.
See the full 1961 to 2025 concordance.