Delay in getting Income Tax Refund: CBDT extends timeline for processing old ITRs:

Delay in getting Income Tax Refund: CBDT extends timeline for processing old ITRs

A positive news for all those taxpayers who have any pending tax refund dues even though they have filed their ITR on or before the deadline in 2024. The Income Tax Department has announced that these undone ITRs for assessment year 2023-24 or financial year 2022-23 will now be processed by 30 November 2025. The announcement for the processing of pending ITR could be explained as: Tax Demand Notice: A tax demand notice could be served to some taxpayers; this depends upon the information that the Tax Department may find out after processing the ITR. Tax Refund: After the ITRs are processed, taxpayers qualified to obtain due tax refunds will be refunded, with interest if any. No refund equates to no tax demand: The ITR is processed just the way it is, without any tax refund or tax demand.

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Announcement By the Income Tax Department

The Income Tax Department released an order on June 9, 2025, stating: “Order u/s 119(2)(a) of the Income-tax Act,1961 regarding processing of returns filed u/s 139 of the Income-tax Act, 1961 beyond the prescribed time limit. The Central Board of Direct Taxes hereby relaxes the time frame prescribed in the second proviso to sub-section (1) of section 143 and directs that electronically filed valid returns of income filed u/s 139 of the Act for Assessment Years 2023-24, for which the date of sending intimation under sub-section (1) of section 143 of the Act has lapsed, shall be sent to the assessee concerned by 30.11.2025.” The above mentioned order signifies that all the remaining or pending ITRs filed on or before 31 July, 2023 for the financial year 2022-23, which remained unprocessed before the deadline announced by the Tax Department, will be processed by 30 November, 2025. The Income Tax Department holds the power to process any duly filed ITR on or before the end of nine months from the end of the financial year for which the ITR was filed.

Who Could Expect a Tax Demand Notice Under Section 148

According to an expert, "In my understanding fresh demands pursuant to these intimation orders under Section 143(1) can't be raised now, as section 119(2)(a) doesn't allow CBDT to pass any orders which are prejudicial to assessee. As per law, fresh tax demands can't be raised under Section 143(1) for AY 2023-24, as even the time-barring deadline for completion of regular assessment proceedings under Section 143(3) had also expired on March 31, 2025. However, as per section 148 of the window of income escaping assessment, for issuing a reassessment notice, for such cases may be invoked but are subject to the fulfilment of stipulated conditions and eligibility criteria prescribed in the said section."

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ITRs that are not Eligible for this Extension of Deadline

These ITRs will not qualify for this extended deadline:

• Returns selected in scrutiny
• Returns that remained unprocessed for any reason attributable to the assessee.

The Income Tax Department in its order dated 9 June, 2025, stated, stated, “In cases where PAN-Aadhaar is not linked, refund of any amount of tax or part thereof due under the provisions of the Act shall not be made as laid down in Circular No.03/2023 dated 28.03.2023 vide  F.No.370142/14/2022-TPL."