CBDT extends Time frame for processing of Income Tax Returns for AYs up to 2017-18 with Refund Claims [Read Order]

CBDT- Assessment Years - refund claims - taxscan

The Central Board of Direct Taxes (CBDT) extended the Time frame for processing of Income Tax Returns for the  Assessment  Years up to 2017-18 with refund claims till September 30, 2021.

It has been brought to the notice of CBDT that due to certain technical issues or for other reasons not attributable to the assessees concerned, several returns for various assessment years up to the assessment year 2017-18 which were otherwise filed validly under section 139 or 142 or 119 of the Income-tax Act, 1961 could not be processed under sub-section (I) of section 143 of the Act.

Consequently, intimation regarding processing of such returns could not be sent within the period of one year from the end of the financial year in which such returns were filed as prescribed in the second proviso to sub-section (I) of section 143 of the Act. This has led to a situation where the taxpayer is unable to get his legitimate refund in accordance with provisions of the Act, although the delay is not attributable to him.

In order to resolve the grievances of such taxpayers, the Board had earlier issued instructions/orders under section 119 of the Act from time to time relaxing the prescribed statutory time limit for processing of such validly filed returns with refund claims in non-scrutiny cases. As per the earlier order dated 10 July 2020, time frame was given till October 31, 2020 to process such returns with refund claims.

The matter has been re-considered by the Board in view of pending taxpayers’ grievances related to the issue of refund. 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 (I) of section 143 and directs that all validly filed returns up to assessment year 2017-18 with refund claims, which could not be processed under sub-section (1) of section 143 of the Act and which have become time-barred, subject to the exceptions mentioned in para below, can be processed now with prior administrative approval of Pr.CCIT/CCIT concerned.

The intimation of such processing under sub-section (I) of section 143 of the Act can be sent to the assessee concerned by September 30, 2021. All subsequent effects under the Act including issue of refund shall also follow as per the prescribed procedures. To ensure adequate safeguards, it has been decided that once administrative approval is accorded by the Pr.CCIT/CCIT, the Pr.CIT/CIT concerned would make a reference to the DGIT(Systems) to provide necessary enablement to the Assessing officer on a case to case basis.

The Board clarified that the relaxation shall not be applicable to the various returns namely returns selected in scrutiny; returns remain unprocessed, where either demand is shown as payable in the return or is likely to arise after processing it; and returns remain unprocessed for any reason attributable to the assessee.

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