CBDT relaxes timeline to process wrongly invalidated tax returns, sets March 2026 as new cutoff
Any subsequent refunds and applicable interest will follow. However, in cases where PAN-Aadhaar linkage is not found, refunds will not be issued as per the guidelines in Circular No. 03/2023 dated March 28, 2023.
- Jul 28, 2025,
- Updated Jul 28, 2025 10:01 PM IST
In a major relief to taxpayers, the Central Board of Direct Taxes (CBDT) has extended the time limit for processing electronically filed income tax returns that were wrongly marked as invalid by the Centralised Processing Centre (CPC), Bengaluru. The move addresses grievances from taxpayers across assessment years whose returns were not processed due to technical errors.
The original deadline for processing such returns — most recently December 31, 2024 for Assessment Year 2023-24 — had expired. In response, the Board, exercising its powers under Section 119 of the Income-tax Act, 1961, has now permitted the processing of all such returns filed electronically up to March 31, 2024.
These returns will be validated and processed in accordance with the law, and intimation under Section 143(1) of the Act will be issued to the affected taxpayers by March 31, 2026.
Any subsequent refunds and applicable interest will follow. However, in cases where PAN-Aadhaar linkage is not found, refunds will not be issued as per the guidelines in Circular No. 03/2023 dated March 28, 2023.
The directive has been issued by Caspar Prakash T, Under Secretary to the Government of India, and all concerned authorities have been asked to ensure compliance.
Tax filing deadline extended
Meanwhile, the income tax return (ITR) filing window for Assessment Year 2025 is open, with several key changes in place — most notably in the way capital gains are treated. Taxpayers have been urged to carefully review the updated slab rates, filing requirements, and revised deadlines announced in Budget 2024.
For salaried individuals and Hindu Undivided Families (HUFs) not requiring audit, the ITR deadline has been extended to September 15, 2025, allowing more time to adapt to the new rules. Businesses and professionals whose accounts require auditing must file by October 31, 2025. Belated and revised returns can be submitted until December 31, 2025, but will incur penalties and interest.
In a major relief to taxpayers, the Central Board of Direct Taxes (CBDT) has extended the time limit for processing electronically filed income tax returns that were wrongly marked as invalid by the Centralised Processing Centre (CPC), Bengaluru. The move addresses grievances from taxpayers across assessment years whose returns were not processed due to technical errors.
The original deadline for processing such returns — most recently December 31, 2024 for Assessment Year 2023-24 — had expired. In response, the Board, exercising its powers under Section 119 of the Income-tax Act, 1961, has now permitted the processing of all such returns filed electronically up to March 31, 2024.
These returns will be validated and processed in accordance with the law, and intimation under Section 143(1) of the Act will be issued to the affected taxpayers by March 31, 2026.
Any subsequent refunds and applicable interest will follow. However, in cases where PAN-Aadhaar linkage is not found, refunds will not be issued as per the guidelines in Circular No. 03/2023 dated March 28, 2023.
The directive has been issued by Caspar Prakash T, Under Secretary to the Government of India, and all concerned authorities have been asked to ensure compliance.
Tax filing deadline extended
Meanwhile, the income tax return (ITR) filing window for Assessment Year 2025 is open, with several key changes in place — most notably in the way capital gains are treated. Taxpayers have been urged to carefully review the updated slab rates, filing requirements, and revised deadlines announced in Budget 2024.
For salaried individuals and Hindu Undivided Families (HUFs) not requiring audit, the ITR deadline has been extended to September 15, 2025, allowing more time to adapt to the new rules. Businesses and professionals whose accounts require auditing must file by October 31, 2025. Belated and revised returns can be submitted until December 31, 2025, but will incur penalties and interest.