Apart from levy of penalty for various defaults by the taxpayer, the Income-tax Law also contains provisions for launching prosecution for offences committed by the taxpayer. Some of them are as under :-
1. Many times, during the course of search it may not be practicable to seize any books of account, other documents, money, bullion, jewellery or other valuable article or thing, for reasons other than those mentioned in the second proviso to section 132(1) (as discussed above). In such cases, as per section 132(3), the tax authorities may serve an order on the owner or the person who is in immediate possession or control thereof that he shall not remove, part with or otherwise deal with it, except with the previous permission of such officer. Such officer may take such steps as may be necessary for ensuring compliance with the provisions of section 132(3). Contravening above discussed provision shall attract prosecution under section 275A.
2. In a case where a search is conducted by the tax authorities, the tax authorities as per Section 132(1)(iib) may require any person who is found to be in possession or control of any books of
account or other documents maintained in the form of electronic record as defined in clause (t) of sub-section (1) of section 2 of the Information Technology Act, 2000 (21 of 2000), to afford the authorised officer the necessary facility to inspect such books of account or other documents. Person who fails to provide such facilityshallbe punishable with rigorous imprisonment and fine under section 275B.
3. If a taxpayer fails to discharge his tax liability, then the tax authority can recover the tax dues from him by attaching his movable and immovable property. If the taxpayer fraudulently removes, conceals, transfers or delivers to any person, any property or any interest therein, intending thereby to prevent that property or interest therein from being attached for recovery of tax, then prosecution proceedings shall be initiated under section 276.
4. If a person fails to pay to the credit of the Central Government: (i) the tax deducted by him (i.e., TDS) or (ii) the dividend distribution tax (DDT) as per section 115-O(2) or (iii) tax in respect of winning from lottery or crossword puzzle as per section 194B , then such person shall be punishable with rigorous imprisonment and with fine under section 276B.
5. 206C governs the provisions relating to collection of tax at source. If a person fails to pay the tax collected by him to the credit of the Government, then he shall be prosecuted as per
section 276BB.
6. If a person makes wilful attempt to evade tax, penalty or interest or under-reports his income, then prosecution proceedings shall be launched against such person under section 276C.
7. If a person makes wilful default in furnishing of return of income under section 139(1) or in response to notice under section 142(1)(i) or section 148 or section 153A then he shall be prosecuted under section 276CC.
8. Section 142(1) deals with the general provisions relating to an inquiry before assessment. Section 142(2A) deals with special audit. Section 276D provides for prosecution in the case of wilful failure by the taxpayer to produce accounts and documents under section 142(1) or to comply with a direction issued under section 142(2A).
9. If a taxpayer makes statement in any verification under the Act or under any rules made thereunder, or delivers an account or statement which is false, and which he either knows or believes to be false, or does not believe it to be true, he shall be prosecuted under section 277.
10. If any person wilfully and with an intent to enable any other person to evade any tax or interest or penalty chargeable and imposable under the Act, makes or causes to be made any entry or statement which is false and which the first person either knows to be false or does not believe it to be true, in any books of account or other document relevant to or useful in any proceedings against the first person or the second person under the Act, then the first person shall be prosecuted under section 277A.
11. If a person abets or induces in any manner another person to make and deliver an account or a statement or declaration relating to any income chargeable to tax which is false and which he either knows to be false or does not believe it to be true or to commit an offence under section 276C(1), he shall be prosecuted under section 278.
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