Sunday, March 3, 2024

Deadline Extended for Processing Refund Claims in ITRs for AY 2021-22

The Central Board of Direct Taxes (CBDT) has announced an extension for processing Income Tax Returns (ITRs) filed for the Assessment Year (AY) 2021-22 that include refund claims. The new deadline is set for April 30, 2024.

Background: A number of taxpayers experienced delays in the processing of their ITRs for AY 2021-22, which were not due to any fault of their own but were caused by technical issues or other external factors. These delays have prevented the timely issuance of refunds.

CBDT’s Response: To alleviate the difficulties faced by taxpayers, the CBDT has decided to extend the processing deadline. This means that ITRs for AY 2021-22, which are validly filed and include refund claims, now have until April 30, 2024, to be processed. This decision comes as part of the CBDT's powers under section 119 of the Income-tax Act, 1961, aiming to mitigate genuine hardships.

Implementation: For the ITRs to be processed under this extended deadline, they must first receive administrative approval from the Principal Chief Commissioner of Income Tax (Pr.CCIT) or Chief Commissioner of Income Tax (CCIT). Following approval, the necessary steps to process the returns and issue refunds will be taken according to standard procedures.

Important Notes:

  • The extension does not apply to ITRs selected for scrutiny.
  • It also excludes returns that are unprocessed due to the taxpayer's own errors or those likely to generate a demand for payment after processing.
  • The aim is to ensure that taxpayers who have faced delays through no fault of their own can receive their due refunds.

Conclusion: This extension is a significant relief for taxpayers awaiting refunds for AY 2021-22. By extending the deadline to April 30, 2024, the CBDT is taking a step to ensure that taxpayers are not penalized for delays that are out of their control. Taxpayers affected by this extension are encouraged to follow up and ensure that their returns are processed in a timely manner.