Rajasthan High Court directs CBDT to extend tax audit filing deadline by one month

In a major relief to taxpayers and professionals, the Rajasthan High Court has ordered the Central Board of Direct Taxes (CBDT) to extend the deadline for filing tax audit reports (TARs) and related income tax returns for the 2025–26 assessment year. The court, in its interim order on Wednesday, directed that the due date be moved from September 30 to October 31, 2025.

The order came in response to a writ petition filed by the Bhilwara Tax Bar Association, which argued that taxpayers and professionals required more time to comply with filing requirements. Several professional associations, chambers of commerce, and the Institute of Chartered Accountants of India (ICAI) had also appealed to the Finance Ministry for an extension, citing workload and procedural challenges.

Order applies to Rajasthan but may set precedent

Technically, the extension ordered by the High Court applies only within Rajasthan unless the matter is contested and decided by the Supreme Court. However, tax experts believe the ruling could influence CBDT to consider a nationwide extension to maintain uniformity across the country.

The Jodhpur Tax Bar Association confirmed the development on X (formerly Twitter). “We are pleased to inform you that the Hon’ble Rajasthan High Court has extended the due date for filing of Tax Audit Reports from 30th September to 31st October,” the association posted.

Growing calls for extension

The push for an extension had been mounting for weeks. On September 19, ICAI formally requested the Finance Ministry for a two-month extension, arguing that taxpayers and auditors needed more breathing space between the deadline for non-audit return filings and tax audit submissions.

Tax professionals also launched a campaign on social media, pressing for relief as the September 30 deadline approached. Chartered accountants hailed the High Court’s decision as a win for both compliance professionals and taxpayers struggling to meet deadlines.

The Bhilwara Tax Bar Association, in its petition under Article 226 of the Constitution, outlined various reasons justifying the extension. It emphasized the workload challenges faced by professionals, the time required for compiling data, and the complexity of audits under the Income Tax Act.

What is a Tax Audit Report?

Under Section 44AB of the Income Tax Act, certain categories of taxpayers are required to have their accounts audited by a chartered accountant. The purpose of this tax audit is to ensure compliance with income tax law provisions and verify that records are maintained accurately.

The chartered accountant conducting the audit must present findings in prescribed formats. Depending on the nature of the taxpayer’s business or profession, the report is furnished in Form 3CA or Form 3CB, along with detailed particulars in Form 3CD.

Implications of the extension

If CBDT accepts the High Court’s direction and issues a nationwide order, taxpayers across India will benefit from an extra month to finalize their tax audit reports. This would also ease pressure on chartered accountants, who have consistently argued that shorter compliance windows lead to undue stress and increase the risk of errors in filing.

For now, the Rajasthan High Court’s order is seen as a significant relief measure. Whether it translates into a broader extension for taxpayers nationwide will depend on CBDT’s response in the coming days.