Penalty for furnishing of false particulars
Penalty for Furnishing of False Particulars
Definition
Furnishing false particulars refers to providing incorrect or misleading information in documents, returns, or statements required by law, usually with the intent to evade tax, duty, or other legal obligations.
It commonly arises in tax law, Companies Act, and other regulatory laws.
1. Relevant Legal Provisions
A. Income Tax Act, 1961
Section 270A – Penalty for under-reporting and misreporting of income.
Section 271(1)(c) – Penalty for furnishing inaccurate particulars of income.
Penalty:
Up to 100% of tax sought to be evaded (in case of misreporting)
Reasonable opportunity of being heard must be given.
Example: Under-reporting income, claiming false deductions.
B. Companies Act, 2013
Section 447 – Fraudulent activities, including furnishing false particulars in company records.
Penalty:
Imprisonment: 6 months to 10 years
Fine: Up to ₹25 crore, or higher depending on seriousness
C. Goods and Services Tax (GST)
Section 122 & 125 of CGST Act, 2017 – Furnishing false particulars in tax returns or invoices.
Penalty:
Up to 100% of tax evaded
Prosecution possible under Section 132 for deliberate fraud.
D. Indian Penal Code (IPC)
Section 182 IPC – Giving false information to a public servant.
Penalty:
Imprisonment: 6 months or
Fine: ₹1,000 or both
Section 420 IPC – Cheating by dishonest misrepresentation.
Penalty:
Imprisonment: up to 7 years
Fine
2. Essential Elements
False information or particulars.
Knowledge of falsity or intention to mislead.
Submission to authority (tax officer, company registrar, public servant).
Damage or potential damage caused by falsity.
3. Case Laws
1. CIT v. R.B. Goel (1982) 138 ITR 773 (SC)
Principle: Under-reporting of income with intent to evade tax amounts to furnishing false particulars. Penalty imposed.
2. Dhirajlal B. Gandhi v. Union of India (1965) 57 ITR 749 (Bom HC)
Held: Mere clerical mistake is not furnishing false particulars; intention is key.
3. State v. S.K. Gupta (2007)
Held: Providing false documents to public authority constitutes offence under Section 182 IPC; liable for penalty.
4. Summary Table
| Aspect | Explanation |
|---|---|
| Definition | Providing false or misleading information to authorities |
| Applicable Laws | IPC Sections 182, 420; Income Tax Act Sections 271(1)(c), 270A; Companies Act 2013 Section 447; GST Act Sections 122,125 |
| Essential Elements | False information, knowledge/intent, submission to authority, potential damage |
| Penalty | Varies: - IPC 182 → 6 months or ₹1,000 fine - IPC 420 → up to 7 years + fine - Income Tax → 100% of tax evaded - Companies Act → 6 months to 10 years + fine up to ₹25 crore |
| Key Cases | CIT v. R.B. Goel (1982), Dhirajlal B. Gandhi (1965), State v. S.K. Gupta (2007) |
✅ Conclusion: Furnishing false particulars is a serious offence under multiple laws in India. Penalties depend on the nature of the false information, intent, and harm caused, ranging from fines and tax penalties to imprisonment.
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