Section 464 · Penalties
Section 464 of the Income-tax Act, 2025 — Penalty for Failure to Furnish Donation Statements and Certificates (Form 10BD / 10BE)
By CA Rajat Agrawal
Updated 05 Jul 2026
Chapter XXI
📜 What the law says — Section 464, Income-tax Act 2025
464. The Assessing Officer may impose a penalty which shall not be less than ` 10000
but which may extend up to ` 100000 on—
(a) the research association, university, college or other institution referred
to in section 45, if it fails to deliver or furnish the documents as may be
prescribed under section 45(4)(a); or
(b) the institution or fund, if it fails to deliver or cause to be delivered a
statement within the time prescribed under section 354(1)(e), or furnish
a certificate prescribed under section 354(1)(g).
Penalty for failure to answer questions, sign statements, furnish information,
returns or statements, allow inspections, etc.
In plain language
What Section 464 is about
Section 464 of the Income-tax Act, 2025 imposes a penalty on certain institutions and funds that fail to file the prescribed donation statement or fail to issue the prescribed donation certificate to their donors. In plain words, if a charitable trust, a research association, a university, a college, or an approved fund collects tax-deductible donations but does not report those donations to the Income-tax Department (or does not give the donor the certificate the donor needs to claim a deduction), a penalty can be levied. It is the successor provision to Section 271K of the Income-tax Act, 1961.
The whole idea behind this section is data-matching. Under the 2025 Act, a donor can claim a deduction for a donation only if the recipient institution has reported that donation to the department. So the law needs a stick to make sure institutions actually file the statement and hand over certificates — otherwise honest donors would lose their deductions through no fault of their own. Section 464 is that stick.
Who it applies to
- Research associations, universities, colleges and notified companies that receive donations qualifying for the scientific-research / social-science-research deduction (the successor to the old Section 35 regime, now dealt with under Section 45(4)(a) of the 2025 Act).
- Institutions and funds approved to receive donations that qualify for the donation deduction (the successor to the old Section 80G regime, now under Section 354(1)(e) and 354(1)(g) of the 2025 Act) — for example, registered charitable trusts, relief funds and NGOs with 80G-type approval.
It does not apply to ordinary taxpayers or donors. The penalty falls on the recipient institution, not the person who gave the donation.
What triggers the penalty
- Failure to deliver the donation statement within the prescribed time. This is the annual statement (currently filed in Form 10BD) that lists every donor, PAN/Aadhaar and amount received during the financial year.
- Failure to furnish the donation certificate to the donor (currently Form 10BE), which the donor uses as proof to claim the deduction in their return.
Either default — not filing the statement, or not issuing the certificate — is enough to attract the penalty.
How much is the penalty
The Assessing Officer may direct the institution to pay a penalty of not less than ₹10,000, extending up to ₹1,00,000. It is a discretionary, one-time penalty within that band — it is not a per-day charge. This is different from late-filing fees on TDS/TCS or SFT statements, which run daily.
How it interacts with related provisions
- The filing obligation itself sits in Section 45 (research donations) and Section 354 (80G-type donations); Section 464 is only the penalty for breaching those obligations.
- A donor's ability to claim a deduction depends on the certificate — so a Section 464 default hurts donors as well as the institution.
- Because it is a penalty proceeding, the general provisions on reasonable cause (successor to Section 273B of the 1961 Act) and the opportunity of being heard apply. If the institution shows a genuine, reasonable cause for the failure, the Assessing Officer can drop the penalty.
Practical implications
- Charitable trusts and approved funds must treat the annual Form 10BD filing and Form 10BE certificate issuance as a hard compliance deadline, not an optional courtesy.
- The penalty is on the institution, but the reputational and relationship damage — donors losing deductions — is often worse than the money.
- Keep clean donor records (name, PAN/Aadhaar, amount, mode) all year so the statement can be filed accurately and on time.
- A single late or missed filing can cost up to ₹1,00,000, so the compliance cost of getting it right is trivial by comparison.
💡 Example
Worked example 1 — Missed statement. A registered charitable trust with 80G-type approval receives ₹40 lakh in donations during FY 2026-27 from 300 donors. It forgets to file the annual donation statement (Form 10BD) by the due date. During assessment the Assessing Officer notices the omission and initiates penalty under Section 464. Since it is a discretionary band of ₹10,000 to ₹1,00,000, the officer levies ₹50,000. Separately, the 300 donors are unable to substantiate their deduction claims until the trust regularises the filing — so the trust rushes to file late and issue certificates.
Worked example 2 — Certificate not issued. A university that received research donations under the Section 45(4)(a) route files its statement on time but never issues the donation certificates to its donor-companies. One donor-company's deduction is questioned. The default falls squarely under Section 464, and the Assessing Officer levies a ₹10,000 penalty (the minimum) because the university corrected the lapse quickly and showed largely bona-fide conduct.
A relatable story. Meera runs the accounts of a small NGO in Jaipur. Every donor trusts the NGO to send them the Form 10BE certificate so they can claim their 80G deduction. One busy year, Meera assumes filing the statement is "just formality" and skips it. Come July, donors start calling — the deduction is not reflecting and they cannot claim it. Then a notice arrives proposing a ₹1,00,000 penalty under Section 464. Meera pleads reasonable cause, files everything immediately, and the officer reduces the penalty to ₹10,000 — but the lesson stuck: the statement and certificates are never "just formality" again.
| Aspect | Details under Section 464 (Act, 2025) |
|---|
| Who is penalised | Research associations, universities, colleges, notified companies (Sec 45(4)(a)); approved donation institutions/funds (Sec 354(1)(e)/(g)) |
| Default 1 | Failure to deliver the donation statement in time (Form 10BD) |
| Default 2 | Failure to furnish the donation certificate to donor (Form 10BE) |
| Minimum penalty | ₹10,000 |
| Maximum penalty | ₹1,00,000 |
| Nature of penalty | One-time, discretionary within band (not per-day) |
| Levying authority | Assessing Officer |
| Relief available | Reasonable cause + opportunity of being heard |
| 1961 Act equivalent | Section 271K |
Related sections
Section 45 — Deduction for donations to scientific / social-science research Section 354 — Deduction for donations to approved funds and institutions (80G successor) Section 461 — Penalty for failure to furnish TDS/TCS statements Section 454 — Penalty for failure to furnish statement of financial transaction (SFT) Section 446 — Penalty for failure to get accounts audited / furnish audit report Reasonable-cause relief — no penalty where failure had a genuine cause
Frequently asked questions
Does Section 464 penalise the donor or the institution?
It penalises the recipient institution or fund, not the donor. However, if the institution defaults, donors may be unable to claim their deduction until the statement and certificate are set right.
How much is the penalty under Section 464?
The Assessing Officer may levy a penalty of not less than ₹10,000 and up to ₹1,00,000. It is a one-time discretionary penalty within that range, not a per-day charge.
Which forms are involved?
The annual donation statement is currently filed in Form 10BD, and the donation certificate given to each donor is currently Form 10BE. Failure to file either can trigger Section 464.
What was the equivalent under the old law?
Section 464 of the Income-tax Act, 2025 corresponds to Section 271K of the Income-tax Act, 1961, carrying forward the same ₹10,000 to ₹1,00,000 penalty band.
Can the penalty be avoided if the delay was genuine?
Yes. Penalty proceedings carry a reasonable-cause defence and the institution must be given an opportunity of being heard. If a bona-fide reason for the failure is shown, the Assessing Officer can decline to levy the penalty.
Is the penalty automatic the moment the deadline is missed?
No. The word used is that the officer 'may' levy it, so it is discretionary. Prompt correction of the lapse and a genuine explanation often lead to the minimum penalty or none at all.
What should a charitable trust do to stay compliant?
Maintain accurate donor records (name, PAN/Aadhaar, amount, mode) throughout the year, file the donation statement by the due date, and issue the donation certificate to every donor on time.
C
CA Rajat Agrawal
Chartered Accountant, EaseValue · Reviewed 05 Jul 2026
This explainer is prepared and reviewed by EaseValue's tax team, based on the text of the Income-tax Act, 2025 (as amended by the Finance Act, 2026).
Disclaimer: This page explains the law in general terms for education and is not professional advice. The Income-tax Act, 2025 takes effect from 1 April 2026; provisions, thresholds and interpretations may change. Please confirm your specific position with our team before acting.
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