CBDT explains why income-tax refunds are delayed this year

If your income-tax refund is still pending, you’re not the only one. Several taxpayers have reported delays this year, and the Central Board of Direct Taxes (CBDT) has now explained why certain refunds are taking longer than usual. According to the department, enhanced scrutiny of select returns is the main reason behind the slowdown—but officials say legitimate refunds will be cleared by December.

High-Value and Unusual Claims Under Close Review

CBDT Chairman Ravi Agrawal said that the department has tightened checks on returns where deduction claims seem unusually high or inconsistent with past filings. These returns have been “red-flagged” and are undergoing detailed examination.

In several cases, taxpayers have been asked to file revised returns to include missing or incorrect information. The department is focusing on weeding out inflated or erroneous claims to ensure only eligible refunds are processed.

Small Refunds Already Issued

Agrawal clarified that refunds involving lower amounts have not faced delays and have been disbursed smoothly. The slowdown is largely in cases involving:

• High-value refunds

• Suspicious or inconsistent deduction claims

• Returns requiring additional documentation or verification

The CBDT chief assured that the department aims to clear all pending genuine refunds by the end of November or December.

Refunds Have Dropped This Year

Official data shows that income-tax refunds fell by around 18%, totalling more than ₹2.42 lakh crore between April 1 and November 10. One reason for this decline, according to Agrawal, is that fewer taxpayers claimed refunds, even though TDS rates were relaxed.

Focus on Reducing Litigation and Clearing Pending Appeals

Agrawal also highlighted efforts to speed up disposal of pending appeals. A significant backlog had accumulated during the Covid years, but the department has now increased the pace of settlement.

• This year, over 40% more appeals have been resolved compared to last year.

• The CBDT aims to clear a substantial number of pending cases by year-end.

Refund Process Expected to Improve Soon

The CBDT chief emphasised that these measures are intended to protect the system from wrongful claims while ensuring faster processing for compliant taxpayers. Once the flagged cases are resolved, refund delays are expected to reduce significantly.