CBDT Cracks Down on Wrong Tax Claims and Tightens Scrutiny on High-Value Returns:

The CBDT has intensified scrutiny after detecting bogus deduction claims, slowing refund releases while prioritising legitimate payments and accelerating appeal disposals to reduce the Covid-Era backlog.

CBDT Targets Faster Clearances After Covid-Era Backlo

Saloni Kumari

Nov 19, 2025

Last update on Nov 19, 2025

CBDT Cracks Down on Wrong Tax Claims and Tightens Scrutiny on High-Value Returns The Income Tax Department has recently detected bogus deduction claims in numerous high-value and system-red-pointed-out filings. This has again ultimately led to the storage of refund payments with the tax department, said Ravi Agarwal on Monday, chairman of CBDT (Central Board of Direct Taxes). He further said that it has been directed that the legalised refunds should be cleared by this month or by December. CBDT's chairman, in an event held at Bharat Mandapan, stated that the department is right now inspecting a bunch of ITRs (Income Tax returns) as suggested by the system for claims in question. He said, "We have also written to taxpayers to file a revised return in case they have forgotten something." Returns with low value are being released, and those with high value are under scrutiny. Chairman noted, "We have analysed and found that some wrong refunds or deductions were being claimed. So, this is a continuous process." As of the data till November 10, the data shows that the rate of refund release has been decreasing year by year, by around 18% to more than Rs. 2.42 lakh crore. Agrawal said the drop may be due to fewer claims and adjusted TDS rates. The CBDT chairman further noted that the Income Tax Department is working towards reducing legal actions in direct tax matters. He said, "Our appellate authorities are working overtime to ensure that pendency is liquidated." He said the backlog grew during the COVID years, but the number of cases being cleared has now increased a lot. He further added, "This year, more than 40% higher disposals have happened in appeals compared to last year. I think we will end the year with a much, much higher number of appeals disposed of."

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Saloni Kumari

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Saloni is a Content Writer with 2+ years of experience at studycafe.in. She writes legal, taxation, and finance related content including GST, Income Tax etc. Skilled in translating complex judicial pronouncements and regulatory developments into clear, and reader-friendly articles. Experienced in covering judgements of ITAT, High Court, GSTAT, and news related to Income Tax, GST, and corporate law. She can be reached at [email protected].