Inadequate disclosures in income tax returns can have dire consequences

In the worst case, the taxpayer could end up paying a heavy penalty and even suffer a jail term

The deadline for filing income-tax return (ITR) for the financial year 2020-21 (assessment year 2021-22) is just two weeks away (December 31). According to income-tax rules, it is mandatory to make certain disclosures while filing the ITR. Failure to do so can have serious consequences.

Jayashree Parihar, senior associate, PSL Advocates & Solicitors says, "Non-disclosure can lead to heavy penalties that can go up to 200 per cent of the tax payable on the misreported income. Further, since the Income-Tax Act is penal in nature, it can lead to prosecution and even imprisonment in certain situations." Here are a few