Chapter XXII - Offences and Prosecution
Section 474
Section 474: failure to afford facility for inspection during search
Section 474 concerns failure to provide an authorised officer the necessary inspection facility when required under Section 247(1)(ii). The underlying duty includes reasonable technical and other assistance for electronic records or information, including necessary access codes.
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Need advice on Section 474?
This article is for general information. Refer to the Income-tax Act, 2025 as amended by the Finance Act, 2026 and the Taxation and Other Laws (Amendment) Act, 2026 for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
If a person, who is required to afford the authorised officer with the necessary facility to inspect the books of account or other documents, under section 247(1)(ii), fails to do so, he shall be punishable with simple imprisonment for a term up to six months, or with fine, or with both.
Introduction
Section 474 applies when a person required under section 247(1)(ii) to give an authorised officer facilities to inspect books or documents during a search fails to do so. The 2026 amendment sets a lighter, alternative punishment.
Key takeaways
Inspection duty
The conduct concerns necessary facilities for inspection of books or other documents.
Current punishment
Simple imprisonment up to six months, fine, or both may follow.
Separate from section 473
This provision targets inspection facilities, not every search-order contravention.
What the section says
If a person required to afford the authorised officer the necessary facility to inspect books of account or other documents under Section 247(1)(ii) fails to do so, that person is punishable with simple imprisonment for a term up to six months, or with fine, or with both.
This is the current text, substituted by the Finance Act, 2026 with effect from 1 April 2026. The section's heading was previously "Failure to comply with section 247(1)(ii)" and the punishment was rigorous imprisonment up to two years and fine - both the heading and the punishment were changed by that amendment.
When this provision applies
Read the inspection duty with Section 247(1)(ii). It concerns a person found in possession or control of electronic books, documents or information, or information on a computer system, and the reasonable technical or other assistance needed by the authorised officer.
The requested assistance can include an access code, by whatever name called. Establish what was required, who possessed or controlled the relevant material and what assistance was actually provided.
Limits and procedural safeguards
The statutory offence uses failure to provide the required facility, not only an expressly spoken refusal. A summary limited to verbal refusal would be too narrow.
Technical difficulty should be documented accurately with the assistance and alternatives offered. This guide does not treat a system outage as an automatic legal defence or promise immunity.
The current punishment is simple imprisonment up to six months, fine, or both. This differs from Section 473’s punishment and from the former Section 474 wording. Prosecution also requires the previous sanction specified in Section 491.
Step-by-step review
1. Identify the authorised officer’s request and its connection to Section 247(1)(ii).
2. Establish possession or control of the relevant electronic material and the assistance reasonably required.
3. Provide and document the required assistance; record any technical impediment and available alternative access accurately.
4. If failure is alleged, preserve the request-and-response evidence and obtain advice on the prosecution and sanction requirements.
Hypothetical example
Hypothetical: an officer requests necessary access to electronic accounts controlled by a company employee. A contemporaneous record of the request, access assistance given and any genuine outage helps establish the facts. The presence of an outage alone does not establish that Section 474 cannot apply.
Records to prepare
Retain the search request, relevant system-access records and the response chronology.
Preserve technical incident records, assistance supplied and any prosecution-sanction material without altering the underlying accounts.
Official amended Act source
Step-by-step flow for applying Section 474
- 1
Was the person required under section 247(1)(ii) to afford the authorised officer the facility to inspect books of account or other documents?
Section 247(1)(ii) covers reasonable technical and other assistance, including access codes, for books, documents or information in electronic form or on a computer system.
- No: Section 474 does not apply.
- Yes: Go to the next step.
- 2
Did the person fail to afford that facility?
The words are "fails to do so". They are not limited to an express refusal.
- No: No offence.
- Yes: Go to the next step.
- 3
Punishment on conviction
Simple imprisonment up to six months, or fine, or both. This is decided through prosecution, not by a penalty order.
- 4
Distinguish Section 473
Section 473 deals with contravening an order under section 247(4). Section 474 deals with failing to give inspection facility under section 247(1)(ii).
Practical checklist
Do
- Retain the search request, relevant system-access records and the response chronology.
- Preserve technical incident records, assistance supplied and any prosecution-sanction material without altering the underlying accounts.
Illustrative example
Worked example: withholding a system password
Hypothetical facts (illustration only, not a real taxpayer): During a search, the authorised officer requires the accountant of a firm, who controls its accounting software, to give the access code so that the electronic books can be inspected. The accountant says he has forgotten the password. Later it is shown that he had it saved and used it that same morning. The facts are assumed.
Requirement
The accountant is in control of electronic books, so he could be required under section 247(1)(ii) to give the access code.
Failure
On these facts he did not afford the facility required. The excuse is contradicted by his own use that morning.
Consequence
He may be prosecuted. On conviction, the punishment is simple imprisonment up to six months, or fine, or both.
Genuine problem
If the access code was genuinely unavailable, that is a question of fact to be shown with evidence. It is not decided by Section 474 itself.
Outcome
- The accountant faces prosecution under Section 474.
- People in control of records should give the access the authorised officer requires, and keep a record of what was given.
Glossary
- Inspection facility
- The necessary means of inspection referred to in Section 474, read with the technical and other assistance in Section 247(1)(ii).
- Possession or control
- The relationship to the electronic records or information identified in the underlying Section 247(1)(ii) duty.
Frequently asked questions
What does Section 474 actually require of me during a search?
Read the duty with Section 247(1)(ii): a person found in possession or control of the specified electronic records or information must provide the reasonable technical and other assistance necessary for inspection, including necessary access codes. Section 474 addresses failure to afford the required facility.
What's the punishment?
Simple imprisonment for a term up to six months, or fine, or both, under the current (Finance Act, 2026 amended) text - a lighter punishment than the earlier rigorous-imprisonment-up-to-two-years version.
How is this different from Section 473?
Section 473 concerns contravention of an order under Section 247(4). Section 474 instead concerns failure to afford the inspection facility required under Section 247(1)(ii). Their triggers and current punishments differ.
Must the failure take the form of an express verbal refusal?
No. The statutory wording is failure to provide the necessary facility when required. Establish the actual request, duty and conduct.
Does a technical problem automatically excuse a failure?
No automatic exemption is stated on that basis. Record the problem and the assistance or alternative access provided; its legal significance depends on the facts and applicable law.
Need help applying this provision to your situation?
Get help if you're facing search-related proceedingsLast updated 10 October 2026