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