Obligation to furnish statement of Information [Sections 271FA, 271FAA and 285BA] (W.e.f. A.Y. 2015-16]
(A) The existing provisions of section 285BA provide for filing of an Annual Information Return by specified persons in respect of specified financial transactions which are registered or recorded by them and which are relevant and required for the purposes to the prescribed income-tax authority.
With a view to facilitate effective exchange of information in respect of residents and nonresidents, the Finance (No. 2) Act, 2014 has substituted the existing section 285BA by making the following changes:
(1) the existing heading "Annual Information Return" of section 285BA has been substituted by the new heading "Obligation to Furnish Statement of Financial Transaction or Reportable Account"
(2) the furnishing of statement by a prescribed reporting authority or a prescribed reporting financial institution shall be in respect of a such specified financial transaction or such reportable account which is registered or recorded or maintained by him and information relating to which is relevant and required for the purpose of this Act to the Amendments as per Finance (No.2) Act, 2014 - applicable for June 2015 and December 2015 terms of Examinations Compiled by - Academics Department, The Institute of Cost Accountants of India (Statutory Body under an Act of Parliament) Page 37 prescribed income-tax authority or such other authority or agency as may be prescribed.
(3) the statement of information shall be furnished within such time, in the form .and manner as may be prescribed.
(4) where any person, who has furnished a statement of information under section 285BA(1), or in pursuance of a notice issued under section 285BA
(5), comes to know or discovers any inaccuracy in the information provided in the statement, then, he shall, within a period of 10 days, inform the income-tax authority or other authority or agency referred to in sub-section (1) the inaccuracy in such statement and furnish the correct information in the manner as may be prescribed. (5) The Central Government may, by rules, specify,—(a) the persons referred to in subsection (1) of section 285BA to be registered with the prescribed income-tax authority; (b) the nature of information and the manner in which such information shall be maintained by the persons referred to in (a) above; and (c) the due diligence to be carried out by the persons referred in (a) for the purpose of identification of any reportable account referred to in sub-section (1) of section 285BA.
(B) Amendment made in section 271FA: Since the heading of section 285BA has been substituted from "Annual Information Return" to "Obligation to Furnish Statement of Financial Transaction or Reportable Account", the existing provisions of section 271FA which provide for penalty for failure to furnish an Annual Information Return will now be substituted by penalty for failure to furnish statement of financial transaction or reportable account.
(C) Penalty for furnishing inaccurate statement under section 285BA [Section 271FAA]: The Finance (No. 2) Act, 2014 has inserted a new section 271 FA A so as to provide that if a person referred to in clause (k) of sub-section (1) of section 285BA, who is required to furnish a statement of financial transaction or reportable account, provides inaccurate information in the statement and where, the inaccuracy is due to a failure to comply with the due diligence requirement prescribed under sub-section (7) of section 285BA or is deliberate on the part of the person; or
(a) the person knows of the inaccuracy at the time of furnishing the statement of financial transaction or reportable account, but does not inform the prescribed income-tax authority or such other authority or agency; or
(b) the person discovers the inaccuracy after the statement of financial transaction or reportable account is furnished and fails to inform and furnish correct information within the time specified under sub-section (6) of section 285BA,
then, the prescribed income-tax authority may direct that such person shall pay, by way of penalty, a sum of `50,000.BACK