As per section 271H, where a person fails to file the statement of tax deducted/collected at source i.e. TDS/TCS return on or before the due dates prescribed in this regard, then he shall be liable to pay penalty under section 271H. Minimum penalty shall be levied of Rs.10,000 which can go uptoRs. 1,00,000. Penalty under section 271H will be in addition to late filing fee prescribed under section 234E.
Apart from delay in filing of TDS/TCS return, section 271H also covers cases of filing incorrect TDS/TCS return. Penalty under section 271H can also be levied if the deductor/collector files an incorrect TDS/TCS return.
No penalty will be levied under section 271H for thefailure to file the TDS/TCS return, if the person provesthat after paying tax deducted/collected by him, alongwith the fee and interest (if any), to the credit of theCentral Government, he has filed the TDS/TCS returnbefore the expiry of a period of one year from the duedate of filing the TDS/TCS return. In other words, nopenalty under section 271H will be levied in case of delayin filing the TDS/TCS return if following conditions aresatisfied :
1) The tax deducted/collected at source is paid to the credit of the Government.
2) Late filing fees and interest (if any) is paid to the credit of the Government.
3) The TDS/TCS return is filed before the expiry of a period of one year from the
due date specified in this behalf.
It should be noted that the above relaxation is applicableonly in case of penalty levied under section 271H for thedelay in filing of TDS/TCS return and not for filing incorrect TDS/TCS return.