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The Central Board of Direct Taxes (CBDT) has introduced new rules for condoning delays in filing income tax returns (ITRs) for claiming refunds or carrying forward losses. Effective from October 1, 2024, these guidelines aim to simplify the process for taxpayers who missed deadlines but wish to claim refunds or losses.
Decision-Making Power Based on Claim Amounts
The authority to accept or reject refund claims is divided based on the claim amounts:
- Claims up to ₹1 crore: Handled by Principal Commissioners of Income Tax (Pr. CsIT).
- Claims between ₹1 crore and ₹3 crore: Managed by Chief Commissioners of Income Tax (CCsIT).
- Claims exceeding ₹3 crore: Processed by Principal Chief Commissioners of Income Tax (Pr. CCsIT).
Bengaluru’s Central Processing Centre (CPC) is also empowered to process applications for delayed ITR-V verification.
Time Limits for Filing Condonation Applications
Taxpayers must file condonation applications within five years from the end of the relevant assessment year. This applies to applications submitted after October 1, 2024.
Processing Time and Key Conditions
Authorities are required to aim for processing these applications within six months. For approval, taxpayers must present a genuine reason for the delay and demonstrate that they faced hardship. The authorities may also investigate further if necessary.
Special Cases
- Court-ordered Refunds: The five-year limit excludes the period during which the case was pending in court. Taxpayers have six months from the court ruling to apply for condonation.
- Supplementary Refunds: Additional refund claims post-assessment are also considered under these rules.
No Interest on Late Refund Claims
Taxpayers filing for delayed refunds should note that no interest will be paid on the refunded amount.
Conclusion
The new guidelines stress the importance of timely filing. Taxpayers who face delays should understand the new rules and ensure compliance to avoid missing out on refunds. Consulting a tax professional is highly recommended for navigating these changes effectively.
