The Income Tax Department has set a deadline of April 30th for the approval of pending income tax refunds, providing relief for taxpayers eagerly awaiting their refunds. This decision comes amidst a flurry of activity within the department, with over 46,000 income tax returns filed within the first five days of the Assessment Year 2024-25 portal opening on April 1st.
Proactive steps have already been taken, with nearly 3,000 returns already processed. In order to streamline taxpayer-related activities for the current fiscal year, the department has devised an interim action plan with specific timelines. One of the primary focuses of this plan is the approval of pending refunds, particularly those withheld under section 241A, where scrutiny assessments have been concluded and necessary orders passed.
Section 241A of the Income Tax Act empowers Assessing Officers to withhold refunds if their grant is likely to adversely affect revenue. Despite substantial tax refunds totaling over ₹3.36-lakh crore issued in the financial year 2023-24, concerns persist among taxpayers regarding pending refunds from both the current and previous fiscal years.
The department aims to approve all pending refunds related to e-returns filed on the Income Tax Business Application (ITBA) for all assessment years by April 30th. Additionally, a critical deadline has been set for matters encountering potential time limitations, particularly those slated to be time-barred by March 31st, 2025.
Under section 148 of the Income Tax Act, tax officials are authorized to issue notices to assesses whose income has not been effectively calculated, within three years from the end of the assessment year. This duration may be extended to ten years if the hidden income exceeds Rs 50 lakh. The department has designated June 30th as the deadline for disposing of penalties in at least half of the cases facing potential time-bars by next March.
Furthermore, the department has provided a one-month timeline for the disposal of all applications related to NIL or lower Tax Deducted at Source (TDS) / Tax Collected at Source (TCS) as of April 1st, 2024. Fresh applications will also be disposed of within a month of receipt. Orders for matters where TDS surveys were conducted up to March 31st, 2024, are expected to be passed by June 30th.
These measures underscore the department’s commitment to facilitating processes, addressing pending matters, and ensuring timely resolution of taxpayer issues, thereby strengthening efficient administration and taxpayer satisfaction.
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