The wait for the income tax refund has been long for many taxpayers across the country. The Income Tax Department website shows that around 1.23 crore income tax returns so far are yet to be processed. Out of 3.98 crore income tax returns, around 2.74 crore ITRs are processed as of August 31.
The last date to file income tax returns is September 15, 2025, for taxpayers whose accounts are not required to be audited. The earlier deadline was July 31. Even though the deadline has been extended, the pace of ITR filing has not been what was expected. With just 15 more days to go for the deadline, it is to be seen how the ITR filing progresses in the remaining two weeks. As regards taxpayers who have already filed their return, many of them are still deprived of a refund. The question arises as to what the reason is that the refund process is slowing down.
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If a taxpayer has tax arrears of previous years or an appeal is pending, then the department can adjust the new refund in the same arrears. In such cases, the refund is received late or sometimes not received in full.
Investigation on large or suspicious refunds
Experts say that the department conducts additional investigation on refunds involving large amounts or appearing suspicious. In such cases, documents are sought from the taxpayer, which takes time to process.
Backlog in season
During the peak season of ITR filing, the department is burdened with lakhs of files. This creates a backlog in the system and slows down the refund process.
Govt’s reform initiatives
The government has taken several steps to speed up the refund process. Finance Minister Nirmala Sitharaman has recently directed income tax officials to issue refunds on time and increase the confidence of taxpayers. At the same time, the deadline for processing old ITRs (assessment year 2023-24) has also been extended to 30 November 2025. This has increased the hope of settlement of pending cases.
Technical glitches and late ITR forms
Several taxpayers have complained of technical glitches recently. Many times, their data in AIS (Annual Information Statement) and Form 26AS do not match,
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