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Leenc   02 December 2021

Is there any way to avoid paying penalty for not filing itr and sch fa or 2019?

A senior citizen who is also a US citizen became Indian tax resident in 2019 (based on more than 182 days and she does not qualify as RNOR) Her income was less than 3 lac so she thought she is not required to file ITR. 

But than we found - because she has a USA bank account - she was required to file ITR and disclose that foreign bank account(asset) This bank account had peak amount during the year 2019 was only about $500

Now I understand that there is a penalty for not filing ITR and not disclosing Foreign asset under Income tax law She can prove the source of funds was legitimate (it was her son who deposited money in to her account as gift) So I don't think black money act will apply here. 
So under IT act - what is the penalty for not filing ITR and filing schedule FA ? And is there any way to avoid that penalty?

 1 Replies

Aryan Raj   10 January 2022

In response to your query,

As per the changed rules notified under section 234F of the Income Tax Act, filing your ITR post the deadline, can make you liable to pay a maximum penalty of Rs.5,000.

From Financial Year 2021 onwards, the income tax department has reduced the maximum amount of penalty for late filing of return to Rs 5,000 from Rs.10,000.

Unfortunately I don't think there is any way to avoid this penalty, but now that you know of this you can be more cautious from next time onwards. Also if you try to legally avoid this penalty by filing a petition that will probably cost you more than Rs. 5000 therefore I suggest you to go ahead and pay this amount. 


Aryan Raj 



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