Section 276CC

Section 276CC — the law in short

What the courts have decided on section 276CC, in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.

• Vinubhai Mohanlal Dobaria v CCIT Supreme CourtHelps taxpayer
  I filed my return late. When is the 276CC offence committed, and is it still a first offence?
  The offence is committed on the day immediately following the s.139(1) due date, not on the day you eventually file. Both defaults here therefore preceded the first show-cause notice, both qualified as a 'first offence' under the 2014 compounding guidelines, and compounding could not be refused on that ground.
• R.P. Darrmalingam v ACIT (SC) Supreme CourtHelps taxpayer
  My penalty proceedings were dropped and a refund was ordered, but the section 276CC prosecution is still running. Is there Supreme Court authority to have it quashed?
  Yes. The Supreme Court set aside the Madras High Court's refusal to quash and quashed the section 276CC prosecution outright. It did so on three things taken together: the appellant had in fact filed the revised return, notwithstanding that his records had been seized; the penalty proceedings initiated against him had been dropped; and as a consequence a refund had been ordered. Looking at the facts in their totality, the Court held that continuing the criminal proceedings would serve no purpose, and said its conclusion was further supported by Guru Nanak Enterprises v. ITO. A departmental review petition against the order was dismissed in July 2025.
• Sasi Enterprises v ACIT Supreme CourtHelps department
  The firm never filed its returns and the assessments were made under s.144. Can we get the s.276CC complaint discharged because the assessment was still being fought?
  No. The Supreme Court held that the s.276CC offence is complete on the failure to furnish the return in due time and is unrelated to the pendency of the assessment. The proviso does not help unless the return was furnished before the end of the assessment year or the tax payable on the total income determined on regular assessment, less advance tax and TDS, is within the statutory figure — and by s.278E the court presumes the culpable mental state, leaving it to the accused to displace it beyond reasonable doubt.
• Prakash Nath Khanna v CIT Supreme CourtHelps department
  I missed the due date but I did file the return under s.139(4) before the assessment. Doesn't that mean I filed 'in due time' and cannot be prosecuted under s.276CC?
  No. The only place the Act fixes a time for furnishing the return is s.139(1); s.139(4) merely permits a belated return, and filing one does not wipe out the infraction of having missed the s.139(1) date. Whether the failure was wilful is a question for the trial court, where s.278E requires the court to presume a culpable mental state and leaves it to you to prove its absence.
• Rajesh Somandas Sachdev v ITO High CourtHelps taxpayer
  I filed my return very late, only after a section 148 notice and after the complaint was filed, but my TDS exceeded my tax and I am owed a refund. Can the prosecution for not filing continue?
  No. The Bombay High Court quashed the complaint. Clause (ii)(b) of the proviso to section 276CC bars prosecution where the tax payable on the total income determined on regular assessment, reduced by advance tax and tax deducted at source, does not exceed the prescribed threshold. Here tax deducted at source was Rs 2,54,788 and the return, accepted by the assessment order of 26 December 2018, showed a refund of Rs 1,64,340 due, which the Department admitted. Following Guru Nanak Enterprises, the Court held the prosecution wholly unwarranted and an abuse of the process of law, and noted that the sanctioning Commissioner had not considered the tax already deducted.
• B. Mohammad Iqbal v ACIT High CourtHelps taxpayerNo later treatment found
  The section 276CC complaint against me was filed by an Assistant Commissioner although my case was with the Income-tax Officer, and no assessment was ever made on the capital gain the complaint alleges. Can that prosecution stand?
  No, on this decision. The Madras High Court quashed the complaint. Only the officer on whom jurisdiction has been conferred by directions or orders is the Assessing Officer; here the show cause notice came from the Income-tax Officer of the ward while the complaint was laid by the Assistant Commissioner, with no transfer under section 127 and no intimation under section 129, so the sanction under section 279 had been given without any application of mind to the question of jurisdiction. Separately, no regular assessment had ever been made, so the tax threshold in the proviso to section 276CC could not be tested and the prosecution was premature.
• PCIT v Prabodh Kumar Tiwari High CourtCuts both waysNo later treatment found
  The department says the section 278E presumption means I must face the whole trial. Has any court actually held the presumption rebutted, and on what material?
  Yes. The Delhi High Court dismissed the department's leave petitions and let an acquittal under section 276CC stand, holding that the statutory presumption of a culpable mental state under section 278E had been rebutted. It applied the burden at its strictest - once the presumption is triggered the accused must disprove wilful default, and to the criminal standard - and still found it discharged on the Commissioner's own findings and the surrounding circumstances. But the Court reached that result on its own reasoning, and expressly rejected the appellate court's ground that cancellation of a penalty under section 271(1)(b) vitiates a prosecution under section 276CC.
• Rajkumar Agarwal v Income Tax Department High CourtHelps departmentNo later treatment found
  I filed my returns late but only after a notice, and I paid the penalty for the delay. Does the proviso to s.276CC save me, and can I get the prosecution quashed by explaining the delay?
  No on both counts. The proviso to s.276CC refers only to a return under s.139(1); s.142(1)(i) and s.148 are conspicuously absent from it, so the benefit is available only to voluntary filing and not to a return filed after the failure has been detected and a notice issued. Payment of penalty under Chapter XXI does not exonerate the assessee from prosecution under Chapter XXII, and because s.278E requires the court to presume the culpable mental state, the explanation for the delay must be led as evidence before the Magistrate and cannot be accepted at the quashing stage.
• Income Tax Officer v Rajendra Prasad Vaish High CourtHelps taxpayerNo later treatment found
  The Department has appealed against my acquittal on a s.276CC charge. Given the presumption in s.278E, how much has the Department still to prove?
  It still has to prove the wilfulness. The Rajasthan High Court dismissed the Department's appeal against an acquittal for a 28-month delay in filing a return, holding that even with the presumption in s.278E the complainant must bring home the mens rea, that the accused's explanation together with payment of the tax and penalty rebutted it, and that in an appeal against acquittal, where two views are plausible, the view favouring innocence prevails.
• Manav Menon v Deputy Commissioner of Income Tax High CourtHelps taxpayer
  I never filed my return for the year and the department has launched a prosecution, but my TDS and advance tax more than covered the tax and I am actually due a refund. Can the criminal case go on?
  No. The Madras High Court quashed the prosecution under section 276CC. Clause (ii)(b) of the proviso says a person shall not be proceeded against for failure to furnish the return under section 139(1) if the tax payable on the total income determined on regular assessment, as reduced by advance tax paid and tax deducted at source, does not exceed Rs 3,000. Here the petitioner's advance tax, TDS, TCS and self-assessment tax came to Rs 23,75,066 against total tax and interest of Rs 23,74,610, leaving a refund of Rs 460 claimed. The proviso came to his rescue and the complaint in EOCC No. 168 of 2016 was quashed.
• Sada Kesava Reddy v Dy CIT High CourtHelps departmentNo later treatment found
  My belated return showed a refund due, so no tax was payable on regular assessment and the proviso to s.276CC protects me. Can I be discharged on that ground before trial?
  Not on this authority. The Telangana High Court held that whether the accused was entitled to a refund, whether there was wilful failure to furnish the return in due time, and whether the notice was validly served are all matters to be decided only after a full trial, and refused to interfere with the dismissal of the discharge application. It also applied the settled position that the benefit of the proviso is available only to a voluntary return under s.139(1) filed before the failure is detected, and not once a notice under s.142(1)(i) or s.148 has been issued.
• Suresh Kumar Agarwal v Union of India High CourtHelps taxpayer
  I filed my post-search return late, paid the tax with interest, no penalty was ever levied and the additions were deleted in appeal. Can the section 276CC prosecution still go on?
  No. The Jharkhand High Court quashed the prosecution as an abuse of the process of law. Three things weighed with the Court: the department had accepted the return with interest, and where the officer levies interest it must be presumed that he extended the time for filing, which excludes wilful default; no penalty proceeding under section 271(1)(a) had been initiated at all, though the provision was available; and the first appellate authority had by order dated 3 July 2019 set aside the whole of the protective assessment. Applying Gopal Ji Shaw, Gujarat Travancore Agency, Autofil, G.L. Didwania and K.C. Builders, the Court held mens rea could not be made out and quashed the complaint and the cognizance order.
• Vipul Aggarwal v ITO High CourtHelps taxpayerNo later treatment found
  The sanction for prosecution names the company as the assessee. Can the complaint proceed against me as its director?
  No. The Delhi High Court quashed the complaint against the director because the sanction placed on record identified only the company; there was no sanction against him, whether as a person, as a director, or as someone responsible for the conduct of the company's business. Without that sanction the department cannot proceed against him for the s.276CC offence.
• Jai Singh Goel v CCIT High CourtHelps taxpayerNo later treatment found
  The Commissioner has refused to compound my s.276CC offence. Can I take that refusal to the High Court?
  Yes. The Delhi High Court set aside a rejection of a compounding application for offences under s.276CC read with s.278E. The two reasons given for the refusal — that the application was out of time, and that the applicant stood convicted — had both fallen away, the first because the Board had relaxed the time limit and the second because the conviction had been set aside on appeal. The Court sent the application back to be considered on its merits.
• CBDT Compounding Guidelines 2024 CBDT Circulars & InstructionsHelps taxpayer
  I want to compound my income tax offence. What do the current guidelines let me do?
  Considerably more than the old ones. The guidelines of 17 October 2024 abolish the Category A/B classification, remove the cap on the number of applications and the 36-month outer time limit, extend compounding to ss.275A and 276B, allow a co-accused to apply for a company or HUF, and set TDS compounding charges at a single 1.5% per month with no interest on delayed payment of the charge.

Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.