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Section 20 of The Companies (Profits) Surtax Act, 1964

If any person fails without reasonable cause to furnish in due time any return under sub-section (2) of section 5, or to produce, or cause to be produced, any accounts or documents required to be produced under section 6, he shall be punishable with fine which may extend to five hundred rupees, and with a further fine which may extend to ten rupees for every day during which the default continues.

Summary

If a person fails without a reasonable cause to submit a surtax return when required by a notice under Section 5(2), they are committing an offence.
If a person fails without a reasonable cause to produce accounts or documents demanded under Section 6, they are liable to be punished.
The punishment for these failures is a fine that can go up to five hundred rupees.
If the default continues after the initial failure, an additional daily fine of up to ten rupees can be charged for every single day the delay continues.

Practical examples

1On June 1, 2026, the Assessing Officer served a notice under Section 5(2) to Delta Electronics requiring a surtax return within 30 days. Delta had no excuse but failed to submit it until July 31, 2026, which was 30 days late. They were fined 500 rupees plus 10 rupees per day for the 30 days of delay, totaling 800 rupees.

2During an assessment on September 10, 2026, the officer ordered Apex Timber under Section 6 to produce its general ledger. Apex simply ignored the notice for 15 days without any valid reason. The court imposed a fine of 400 rupees for the initial failure and 10 rupees per day for the 15-day delay.

FAQ

1. How is the fine calculated if my delay goes on for several weeks?

You can face a fixed initial fine of up to five hundred rupees, plus an ongoing fine of up to ten rupees for every additional day the default continues.

2. Who can demand accounts or documents that trigger this penalty if ignored?

The Assessing Officer can demand these accounts or documents under Section 6 of the Act.

Test yourself

Q1.Under Section 20 of The Companies (Profits) Surtax Act, 1964, which specific failure regarding tax returns triggers a fine?

Q2.Under Section 20 of The Companies (Profits) Surtax Act, 1964, what is the maximum initial fine that can be imposed for failing to produce accounts required under Section 6?

Q3.Under Section 20 of The Companies (Profits) Surtax Act, 1964, if a company continues to delay the production of documents required under Section 6, what is the maximum daily fine that can be added?

Q4.Under Section 20 of The Companies (Profits) Surtax Act, 1964, how does Section 6 interact with this penalty provision?

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