Monetary Fine Imposed by Tax Authority

• Submitting false or misleading information in PT registration, return filings, or declarations attracts a financial penalty.
  
• The penalty amount varies state to state but may range from ₹1,000 to ₹5,000 per instance.
  
• In some states, the penalty is linked to the amount of tax evaded or misreported.
  
• Authorities may impose additional fines for repeated or intentional violations.
  
• The penalty is levied per false submission, not as a one-time charge.
  

Interest on Underpaid or Evaded Tax

• If false information leads to underpayment of tax, interest is levied on the shortfall amount.
  
• Interest rates are generally in the range of 1% to 2% per month until full payment is made.
  
• This interest is charged in addition to the penalty for false declaration.
  
• It applies from the due date of payment till the date of actual payment.
  

Cancellation of Registration or Certification

• Providing false information during PT registration may lead to suspension or cancellation of the PTRC or PTEC certificate.
  
• The taxpayer may be required to reapply with correct documents or face restricted access to filing and payment services.
  
• Business operations that require valid PT registration may be hampered or disqualified during this period.
  
• Some authorities may blacklist the taxpayer for future scrutiny or audits.
  

Prosecution or Legal Action in Severe Cases

• If the misrepresentation is intentional and leads to significant tax evasion, the PT authority may initiate legal proceedings.
  
• Offenses involving fabricated documents, impersonation, or forged income data can attract criminal prosecution under the respective state act.
  
• Convictions may involve court fines and imprisonment, especially for fraud or large-scale misreporting.
  
• These actions are typically reserved for willful defaulters or habitual offenders.
  

Audit and Inspection Triggered by False Data

• Submitting incorrect information raises red flags that may result in detailed departmental audit or inspection.
  
• Authorities will verify employee records, payroll data, challans, and returns to identify the discrepancies.
  
• This process can lead to discovery of other non-compliances, increasing the overall penalty burden.
  
• Businesses may also lose credibility in government tenders, licensing, or financial assessments.