Section 472 — Bar of limitation for imposing penalties

(1) No order imposing a penalty under this Chapter shall be passed after the
expiry of six months from the end of the quarter in which—
( a) the proceedings, in the course of which action for the imposition of
penalty has been initiated, are completed, if the relevant assessment or
other order is not the subject-matter of an appeal under section 356 or
357 or 362;
( b) the order of revision is passed, if the relevant assessment or other order
is the subject-matter of revision under section 377 or 378;
( c) the order of appeal is received by the jurisdictional Principal Commis -
sioner or Commissioner, if the relevant assessment or other order is the
subject-matter of an appeal under section 356 or 357 or 362;
( d) notice for imposition of penalty is issued, in any other case.
(2) The order imposing or enhancing or reducing or cancelling penalty or drop -
ping the proceedings for the imposition of penalty may be revised on the basis of
assessment as revised by giving effect to the order under section 356 or 357 or 362
or 365 or 367 or revision under section 377 or 378, where the relevant assessment
or other order is the subject-matter of an appeal or revision under the said sections.
(3) No order imposing or enhancing or reducing or cancelling penalty or dropping
the proceedings for the imposition of penalty under sub-section (2) shall be passed—
17. Sub-sections (4) and (5) inserted by the Finance Act, 2026, w.e.f. 1-4-2026.
( a) unless the assessee has been heard, or has been given a reasonable
opportunity of being heard;
( b) after the expiry of six months from the end of the quarter in which the
order under section 356 or 357 or 362 or 365 or 367 is received by the
jurisdictional Principal Commissioner or Commissioner or the order of
revision under section 377 or 378 is passed.
(4) The provisions of section 471(2) shall apply to the order imposing or enhancing
or reducing penalty under this section.
(5) In computing the period of limitation for the purposes of this section, following
period shall be excluded—
( a) the time taken in giving an opportunity to the assessee to be reheard
under section 244(2);
( b) the period commencing on the date on which stay on proceeding for levy
of penalty was granted by an order or injunction of any court and ending
on the date on which certified copy of the order vacating the stay was
received by jurisdictional Principal Commissioner or Commissioner.