Section 481 — Failure to produce accounts and documents. Successor to s.276D of the 1961 Act.
Section 481 is in Chapter XXII — Offences and Prosecutions, which runs from section 473 to section 498.
The section as it now stands was substituted by Act No. 4 of 2026 with effect from 1 April 2026. The live offence is a single one: a person who wilfully fails to comply with a direction issued to him under section 268(5) is punishable with simple imprisonment for a term up to six months, or with fine, or with both.
The substitution narrowed both the offence and the punishment. The earlier text also made it an offence to wilfully fail to produce the accounts and documents referred to in a notice served under section 268(1) on or before the date specified in it, and prescribed rigorous imprisonment which may extend to one year and fine. Failure to produce accounts and documents called for under a section 268(1) notice is therefore no longer an offence under this section, though the heading still reads "Failure to produce accounts and documents".
A direction under section 268(5) cannot be enforced by an assessment alone, so the Act backs it with a criminal sanction for wilful non-compliance. The 2026 substitution keeps that sanction but confines it to the direction, leaving ordinary non-production of documents to the assessment and penalty machinery, and it replaces rigorous imprisonment with simple imprisonment while allowing a fine alone.
| What | Figure | The condition on it | Where |
|---|---|---|---|
| Maximum imprisonment | Simple imprisonment for a term up to six months | Wilful failure to comply with a direction under section 268(5); the court may instead impose a fine, or both; substituted by Act No. 4 of 2026 w.e.f. 1-4-2026 for rigorous imprisonment which may extend to one year and fine | Section 481 |
The offence needs wilfulness, so an inability to comply is not the same as a refusal. Only a direction under section 268(5) is covered now, and the heading is no guide to what the section currently punishes. The punishment is also softer: simple rather than rigorous imprisonment, capped at six months, with a fine available instead of imprisonment rather than in addition to it.
You meet it after a direction under section 268(5) to get accounts audited or inventory valued has gone uncomplied with, as a prosecution launched on that failure. It has no form of its own — the direction under section 268(5) is what you actually receive.
If a person wilfully fails to comply with a direction issued to him under section 268(5), he shall be punishable with simple imprisonment for a term up to six months, or with fine, or with both.
See the full 1961 to 2025 concordance.