Penalty for False or Omission of Entry in Books of Account
Nature of Default
- Penalty may be imposed if, during proceedings, a person is found to have:
made a false entry in the books of account; or
omitted a relevant entry in the books to evade tax.
- It also applies to any other person who causes such false entry or omission to evade tax liability.
Meaning of False Entry
- A false entry includes the use or intended use of:
forged or falsified documents such as false invoices or other false evidence;
invoices for goods or services not actually supplied or received; or
invoices for goods or services to or from a non-existent person.
Quantum of Penalty
A penalty equal to the aggregate amount of false or omitted entries may be imposed by the Assessing Officer, Joint Commissioner (Appeals), or Commissioner (Appeals).