Statement in Form No.52A u/s 285B to be furnished by film producers. - Income Tax - 1727/CBDT

INSTRUCTION NO. 1727/CBDT Dated: August 22, 1986 Section 285B of the Income-tax Act, 1961 provides that any person carrying on the production of a cinematograph film during the whole or any financial year shall in respect of the period during which such production is carried on by him in such financial year, prepare and deliver to the Income-tax Officer, within thirty days from the end of such financial year or within thirty days from the date of the completion of the production of the film, whichever is earlier a statement in the prescribed form containing particulars of all payments of over five thousand rupees in the aggregate made by him or due from him to each such person as is engaged by him in such production as employee or otherwise. This statement should be filed in the form 52A. 2. A person who without reasonable cause or excuse fails to furnish in due time the statement mentioned in section 285B becomes liable for imposition of a penalty u/s 272A(2) of the Income-tax Act, 1961. The quantum of penalty may extend to Rs. 10/-(Rupees ten only) for every day during which the failure continues. 3. The Audit has found that in 1982-83 in most of the cases the aforesaid statement had not been filed by the film producers or was filed late and in most of the cases no penal action u/s 272(2) was taken against them. 4. The Board have by their letter F.No. 299/09/85-I.T.(Inv.III) dated the 22nd May, 1985 desired that the provisions of section 272A(2) of the Income-tax Act, 1961 should be strictly enforced. These instructions are again reiterated for strict compliance. 5. It has come to the notice of the Board that perhaps some film producers have construed the provisions of section 285B in a very restrictive manner with the result that in some statements furnished in form No.52A only payments made to employees or others engaged to render professional services were shown. This interpretation is totally erroneous as u/s 285B, a statement in form No. 52A is to be furnished in respect of all payments of over five thousand rupees in the aggregate made by the film producer or due from him to each such person as is engaged by him in film production as employee or otherwise and not merely in respect of employees or others engaged by him in film productional services. The assessing officer should keep this aspect in view while examining the accuracy and correctness of the information furnished in from No. 52A by film producers. Effective checks should invariably be made in cases where the payments shown in form No. 52A form a small percentage of the total cost of the production of a film. 6. The information regarding furnishing of statutory statement in form No. 52A by film producers in respect of periods (a) 1.4.85 to 31.3.1986 and (b) 1.4.86 to 30.6.86 may kindly be furnished to the Board in the enclosed proforma by the 12th September, 1986. Information in respect of the period 1.7.86 to 30.9.86 should be furnished by the 15th October, 1986. 7. All such cases where Form No. 52A should have been filed by the film producers and has not been filed should be reviewed with a view to imposing penalties u/s 272A(2). Feasibility of launching prosecution u/s 277 of the Income-tax Act, 1961 should be examined in all cases where it is found that the statement given in the Form No. 52A was false.