The Statutory Brief

IT Act 1961 → 2025 / Section 276B

Penalties

Section 276B → Section 476

Prosecution for failure to deposit TDS

Section 276B of the old Income-tax Act, 1961 · new section 476 under the Income-tax Act, 2025

New reference Section 476

Income-tax Act, 1961Section 276B

  • Up to 28 Feb 2026: rigorous imprisonment of 3 months to 7 years and fine; from 1 March 2026 the 1961 Act was amended to the same graded scheme as section 476
  • No prosecution if paid by the TDS statement due date

Applies to FY 2025-26 (AY 2026-27) and earlier years.

Income-tax Act, 2025Section 476

  • From 1 April 2026 (Finance Act 2026): graded punishment
  • Above ₹50 lakh: simple imprisonment up to 2 years, or fine, or both
  • ₹10–50 lakh: simple imprisonment up to 6 months, or fine, or both
  • Up to ₹10 lakh: fine only
  • No prosecution for any amount paid by the due date of the TDS statement (section 476(2))

Applies from tax year 2026-27 (from 1 April 2026).

What changed

A real change: the Finance Act 2026 replaced rigorous imprisonment with graded simple imprisonment or fine, based on the amount — in section 476 of the 2025 Act and, from 1 March 2026, in section 276B of the 1961 Act too.

Practice notes

  • Interest and late fees for TDS defaults continue separately (section 398, 427).

These are summaries, not the statutory text. Read the bare Act for both sections on the Income Tax Department's official site, which also has a side-by-side comparison utility.

Frequently asked

What is the punishment for not depositing TDS under the new Income Tax Act 2025?

Section 476: fine only up to ₹10 lakh; up to 6 months simple imprisonment for ₹10–50 lakh; up to 2 years above ₹50 lakh. No prosecution if paid before the TDS statement due date.

What is section 276B called in the new Income-tax Act, 2025?

Section 276B of the Income-tax Act, 1961 corresponds to Section 476 of the Income-tax Act, 2025, which applies from 1 April 2026 (tax year 2026-27).

What changed in section 276B under the new Income Tax Act?

A real change: the Finance Act 2026 replaced rigorous imprisonment with graded simple imprisonment or fine, based on the amount — in section 476 of the 2025 Act and, from 1 March 2026, in section 276B of the 1961 Act too.

Is section 276B still applicable for FY 2025-26?

Yes. Income of FY 2025-26 (AY 2026-27) and earlier years is governed by section 276B of the 1961 Act. Section 476 of the 2025 Act applies from tax year 2026-27.

Related sections

234E→427Late fee for delay in filing TDS/TCS statements (and SFT)194J→393TDS on fees for professional or technical services, royalty and director's fees270A→439Penalty for under-reporting and misreporting of income