Imagine discovering that you’re entitled to a significant tax refund from a previous financial year, only to realise that the deadline for filing or revising your Income Tax Return ( ITR ) has long passed.
For many taxpayers, this scenario is all too real. Thankfully, the concept of a Condonation of Delay Request exists to provide relief in such situations. However, recent changes introduced by the Central Board of Direct Taxes ( CBDT ) have altered the landscape for claiming old tax refunds and carrying forward losses. Here’s what you need to know.
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This provision is crucial for individuals who, due to genuine hardships or unforeseen circumstances, missed the original filing dates. It serves as a lifeline for those looking to claim refunds from past financial years or carry forward losses to offset future income.
Previously, taxpayers had a generous window of six years from the end of the relevant financial year to submit a condonation request. However, as of October 1, 2024, the CBDT has tightened this timeframe. Now, taxpayers have only five years to file such requests. Thus, if you’re considering claiming an old refund or need to carry forward losses, it’s imperative to act promptly to avoid missing out entirely.
The new rules also introduce a mandate for faster processing of condonation requests. The CBDT now requires that these requests be resolved within six months from the end of the month in which they are filed. This is a significant improvement over the previous system, where there was no fixed timeline, and taxpayers often faced prolonged periods of uncertainty.
The responsibility for deciding on these requests has been delegated to the Commissioner of Income Tax at the Central Processing Centre ( CPC ) in Bengaluru. This centralization aims to ensure consistency and efficiency in handling cases.
Get a Handbook on TDS Including TCS as Amended up to Finance Act 2024, Click Here
There are, however, exceptions to the reduced time limit. If your refund arises due to a court order, the condonation request must be filed within six months from the end of the month in which the order was issued. This provision recognizes the often lengthy judicial processes and provides taxpayers affected by such delays a fair opportunity to claim their dues.
To be eligible for filing a condonation of delay request, you must demonstrate a genuine hardship that prevented you from filing or verifying your return on time. This could include situations like medical emergencies, natural disasters, or other significant disruptions. It’s crucial to substantiate your claim with proper documentation and evidence to support your case.
Filing a condonation request has been streamlined through the Income Tax Portal. After logging in, you can navigate to the ‘Services’ section and select ‘Condonation Request.’ From there, you’ll choose the appropriate reason—whether you need to file an ITR after it has become time-barred or verify an ITR beyond the deadline. The application will require detailed information, including the assessment year in question, the claim value, and a comprehensive explanation of the delay, accompanied by supporting documents. Once submitted, you can verify the request electronically, making the process both accessible and user-friendly.
Get a Handbook on TDS Including TCS as Amended up to Finance Act 2024, Click Here
Common scenarios where taxpayers might need to file a condonation request include missing the filing deadline entirely or failing to verify the ITR within the required 30-day window after submission.
In the former case, if both the belated return filing date and the revised return deadline have passed, the condonation request becomes your only avenue to claim refunds or carry forward losses. In the latter, an unverified ITR is considered invalid, but a successful condonation request can rectify this oversight.
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