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Income Tax Refund Delay: CBDT clarifies reasons & timeline for ITR payouts

CBDT Chairman Ravi Agarwal stated that the scrutiny of high-value and system-flagged refund claims is almost complete. Low-value refunds are being issued, and cases involving incorrect deductions are under review.

CBDT on Income Tax Refund Delays: Why Your ITR Payout is Withheld & What to Do
CBDT on Income Tax Refund Delays: Why Your ITR Payout is Withheld & What to Do Credit:Pixabay and TV9
| Updated on: Nov 19, 2025 | 02:33 PM

New Delhi: Several taxpayers are yet to receive their income tax refund this year. In a big relief, Central Board of Direct Taxes (CBDT) Chairman Ravi Aggarwal addressed the issue and clarified as to when the refunds will be issued by the department. Addressing the Taxpayers Lounge at the India International Trade Fair (IITF), the CBDT chief clarified the reason behind the delay.

When to Expect Your Income Tax Refund

According to a PTI report, the CBDT chairman said that the department is probing high-value and system-flagged claims and the investigation is in the final stages. He said that low-value refunds are being issued. Agarwal further said that the department’s investigation found that some taxpayers had claimed wrong refunds or wrong deductions, so this is a continuous process. “We expect the remaining refunds to be issued by this month or December,” he assured.

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According to Aggarwal, refund cases which are high in value, require additional verification, so processing of such cases is taking time.

According to Agarwal, the system has red-flagged many ITRs which show suspicious or incorrect deductions. Refunds have been withheld until their investigation is completed.

He said that the department found that many taxpayers have made false deduction claims and such cases need manual verification.

CBDT has sent mails/notices to some people asking them to file revised returns if they have missed any details or went wrong. This increases the processing time.

Why Are Income Tax Refunds Delayed?

  • Refunds above Rs 1 lakh are subject to additional checks.
  • The department conducts manual reviews on foreign income, capital gains and income from multiple sources.
  • Filing revised returns increases the timeline.
  • If you do not verify the ITR, the return gets invalidated and the refund stops.
  • If Form 26AS/AIS and ITR do not match, the system holds the return.
  • There is a delay even if the income reported by the bank or employer is mismatched.
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