Hence these individuals, who wish to check the status of their refund, should check their email inbox or keep a close watch for any intimation notice email from the income tax department. This intimation notice will have the details of the tax refund, if any, payable to them.
After an ITR is processed at the Centralised Processing Centre (CPC) within a specified period, the income-tax department would issue an intimation notice under section 143(1) of the Income-tax Act, 1961. If an individual has received an intimation notice for the same, it means that their filed ITR has been successfully processed. It is usually followed by the credit of refund amount, if any.
However, many taxpayers are waiting for the processing of their ITR for income related to FY 2020-21 (AY 2021-22). The delayed cases, which will now receive refund, are related to those taxpayers who filed the returns on time but did not receive the refund yet. “It has been brought to the notice that due to certain technical issues or for other reasons not attributable to the assesses concerned, several returns for assessment year (AY) 2021-22, which were otherwise filed validly, could not be processed under sub-section (1) of section 143 of the Act. Consequently, intimation regarding processing of such returns could not be sent within the timeframe prescribed under sub-section (1) of section 143 of the Act. This has led to a situation where the taxpayers are unable to get their legitimate refund in accordance with provisions of the Act, although the delay is not attributable to them,” said the income-tax department in an order dated March 1, 2024.
Also read: Tax info mismatch? This new portal can help find & fix it.
Why the CPC could not process pending refund cases for AY 2021-22 after March 31, 2023
Till AY 2021-22 (March 31, 2022) the time limit for CPC to process an ITR was one year from the end of the financial year in which the ITR was filed. For income earned during FY 2020-21 (AY 2021-22), the financial year of filing ITR was 2021-22 which ended on 31 March 2022. So, the last window for the income tax department to process this refund was one year from this date, which is March 31, 2023. Once the time limit gets over the CPC can neither process the said ITR or send the intimation notice under section 143 (1). This was the reason why the income tax department was unable to process these pending refund cases after March 31, 2023.
Also read: How much income tax deduction is available on bank FD, RD and savings account interest.
Deadline to process ITRs for FY 2020-21 AY 2021-22 extended
Taking cognisance of the number of valid refund cases pending, the income tax department has extended the processing deadline to April 30, 2024.
“To mitigate genuine hardship being faced by the taxpayers on this issue, Board, by virtue of its powers under section 119 of the Act, hereby relaxes the time-frame prescribed in second proviso to sub-section (1) of section 143 and directs that all returns of income validly filed electronically for AY 2021-22 with refund claims, for which date of sending intimation under sub-section (1) of section 143 of the Act has lapsed, subject to the exceptions mentioned…, can be processed now with prior administrative approval of Pr.CCIT/CCIT concerned. The intimation of such processing under sub-section (1) of section 143 of the Act can be sent to the assessee concerned by 30.04.2024,” said the order from CBDT.
Once the ITR is processed taxpayers will start receiving intimation for the same.
“The intimation notice shows the computation of income as per the taxpayer as well as CPC. If the calculations tally, then only a tax refund is issued. In some cases, the intimation notice under section 143 (1) also shows details of outstanding old tax demand, which is proposed to be adjusted against the refund, if any,” says Mihir Tanna, associate director-direct tax, S.K Patodia LLP, a CA firm.
However, the extended deadline is not applicable for certain cases. In the order, income tax department has said:
The relaxation shall not be applicable to the following returns:
a) returns selected in scrutiny,
b) returns remaining unprocessed, where either demand is shown as payable in the return or is likely to arise after processing it,
c) returns remaining unprocessed for any reason attributable to the assessee.
This date is when pending income tax refunds for AY 2021-22 will be processed; please check your email for confirmation.
Individuals who want to check the status of their refund should keep an eye on their email inbox for any intimation notice from the income tax department. This notice will contain details of any tax refund due to them.
Once an Individual Tax Return (ITR) is processed at the Centralized Processing Centre (CPC) within a specific period, the income tax department will issue an intimation notice under section 143(1) of the Income-tax Act, 1961. Receiving this notice indicates that the filed ITR has been successfully processed, usually followed by the credit of any refund amount.
Many taxpayers are awaiting the processing of their ITR for income from FY 2020-21 (AY 2021-22). The delayed cases now set to receive a refund are related to those taxpayers who filed their returns on time but have not yet received a refund. The income-tax department stated in an order dated March 1, 2024, that technical issues or other reasons not related to the taxpayers have caused delays in processing these returns, leading to the inability of taxpayers to receive their legitimate refunds as per the Act.
Also read: Tax info mismatch? This new portal can help find & fix it.
Why the CPC faced challenges processing pending refund cases for AY 2021-22 post March 31, 2023
Until AY 2021-22 (March 31, 2022), CPC had a one-year limit from the end of the financial year in which the ITR was filed to process it. With the financial year for filing ITR being 2021-22 ending on March 31, 2022, the last window for the income tax department to process refunds was March 31, 2023. After this deadline, CPC could no longer process the said ITRs or issue intimation notices under section 143(1). This was why pending refund cases could not be processed post March 31, 2023.
Also read: How much income tax deduction is available on bank FD, RD and savings account interest.
ITR processing deadline for FY 2020-21 AY 2021-22 extended
To address valid refund cases pending, the income tax department has extended the processing deadline to April 30, 2024.
“To alleviate genuine taxpayer concerns, the Board relaxes the time-frame for processing returns of income validly filed electronically for AY 2021-22 with refund claims. This relaxation allows processing of returns with administrative approval by the specified deadline,” stated the CBDT order.
After processing the ITRs, taxpayers will receive intimation notices. These notices compare income computation by the taxpayer and CPC, only issuing tax refunds if calculations align. In some cases, the notice may also show details of outstanding old tax demands to be adjusted against any refunds.
Notably, the extended deadline does not apply to certain cases. The income tax department specified in the order that:
The relaxation does not apply to returns under scrutiny, unprocessed returns with likely demand, or returns unprocessed for reasons attributable to the assessee.
