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CBDT Extends Deadline for Processing Electronic IT Returns Invalidated Due to Technical Errors

Written by: Team Angel OneUpdated on: 29 Jul 2025, 9:38 pm IST
CBDT allows processing of electronically filed IT returns declared invalid due to tech glitches by March 31, 2026, enabling refund eligibility.
CBDT Extends Deadline for Processing Electronic IT Returns Invalidated Due to Technical Errors
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The Central Board of Direct Taxes (CBDT) has issued a crucial relaxation for taxpayers whose electronically filed income tax returns (ITRs) were invalidated due to technical issues. The newly announced deadline enables processing of these returns up to March 31, 2026, ensuring eligible taxpayers can claim refunds with applicable interest.

CBDT Enables Refunds for ITRs Affected by Technical Glitches

On July 28, 2025, CBDT released an official circular extending the processing timeline for specific electronically filed ITRs that had been mistakenly marked invalid by the Central Processing Centre, Bengaluru. These ITRs must have been filed on or before March 31, 2024. The updated directive allows reassessment and processing of such returns until March 31, 2026, to facilitate proper computation and issuance of refunds. 

This relief intends to assist taxpayers impacted by system errors and to ensure rightful reimbursements with applicable interest are not denied.

Mandatory PAN-Aadhaar Linkage Still Required

While this relaxation benefits many, the CBDT clarified that refunds will still be withheld if the taxpayer’s PAN is not linked with Aadhaar, as per prevailing rules. This condition reinforces the government's broader push toward integrated identity compliance. Taxpayers are therefore encouraged to ensure their PAN-Aadhaar linkage to avoid delays or cancellations of eligible refunds.

Read More: Big Relief for Taxpayers: Low-Value Tax Cases to be Withdrawn by Government!

Scope of Eligibility and Administrative Instructions

This relief applies to all individual and corporate taxpayers whose valid submissions were rejected due to system-level glitches and not due to taxpayer error. The CPC and field offices have been instructed to comply promptly with the directive and ensure timely communication with affected assesses, thereby enabling financial clarity and closure for the taxpayers.

Implications for Taxpayers and Refund Disbursals

This move bridges the gap caused by technical delays and supports taxpayer confidence in electronic filing systems. Improved responsiveness from tax authorities ensures timely refund disbursals and minimises grievances related to technical rejections, safeguarding the credibility of India’s digital tax infrastructure.

Conclusion

The CBDT's decision to extend the processing window for electronically filed ITRs incorrectly marked as invalid offers timely relief. With a fresh processing deadline of March 31, 2026, eligible taxpayers now have a renewed chance to claim refunds, provided they meet all compliance requirements, including PAN-Aadhaar linkage.

Disclaimer: This blog has been written exclusively for educational purposes. The securities or companies mentioned are only examples and not recommendations. This does not constitute a personal recommendation or investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in securities are subject to market risks. Read all related documents carefully before investing.

Published on: Jul 29, 2025, 12:14 PM IST

Team Angel One

Team Angel One is a group of experienced financial writers that deliver insightful articles on the stock market, IPO, economy, personal finance, commodities and related categories.

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