CBDT has issued Circular No. 07/2025 dated June 25, 2025, addressing the relaxation of the time limit for processing valid income tax returns filed electronically pursuant to orders under Section 119(2)(b) of the Income-tax Act, 1961. These returns, delayed due to technical reasons and condoned by competent authorities, will now be processed. The relaxation applies to returns filed by March 31, 2024, for which the prescribed intimation period under Section 143(1) has lapsed. Intimation for such cases will be issued by March 31, 2026. This measure excludes cases where proceedings for assessment, reassessment, recomputation, or revision of income have already been completed.
Additionally, refunds with applicable interest will be issued for eligible cases, barring instances where PAN-Aadhaar linkage is not found, as per Circular No. 03/2023. The Director General of Income-tax (Systems), Bengaluru, will establish procedures to ensure compliance and timely issuance of intimations. Taxpayers who have faced delays in receiving refunds due to non-processing of their returns are expected to benefit from this extension. However, all stakeholders are advised to ensure compliance with the specified guidelines for efficient processing.
F. No.225/30/2025/ITA-II
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
North Block
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Circular No. 07/2025-Income Tax Dated: 25th June, 2025
Order u/s 119 of the Income-tax Act,1961
Subject: Relaxation of time limit for processing of valid returns of income filed electronically pursuant to order u/s 119(2)(b) of the Income-tax Act,1961 passed by Competent Authority-reg.
It has been brought to the notice of the Central Board of Direct Taxes ( the Board’) that returns of income filed in pursuance of order u/s 119(2)(b) of the Income-tax Act,1961 (the Act) condoning the delay in filing such returns, could not be processed within the prescribed time limit under second proviso to section 143 (1) of the Act due to technical reasons. Such orders u/s 119(2)(b) of the Act condoning delay in filing of return were passed by Competent Authority as specified in CBDT’s Circular No.09/2015 vide F.No.312/ 22/ 2015-0T dated 09.06.2015, Circular No.07/2023 vide F.No.312/63/2023-OT dated 31.05.2023 and latest Board’s Circular No.11/2024 dated 01.10.2024. Grievances have been filed regarding non-receipt of refund due to non-processing of these returns in some cases.
2. The matter has been considered by the Board and it has been decided to relax the time-frame prescribed in second proviso to sub-section (1) of section 143 of the Act in exercise of its powers under section 119 of the Act, and directs that valid returns of income filed electronically on or before 31.03.2024 pursuant to condonation of delay u/s 119(2)(b) of the Act by the competent authority, for which date of sending intimation under sub-section (1) of section 143 of the Act has lapsed, shall be processed now. Accordingly, intimation under sub-section (1) of section 143 of the Act in respect of processing of such ITRs shall be sent to the assessees concerned by 31.03.2026.
3. The relaxation accorded above shall not be applicable to cases where any proceeding for assessment (u/s 143(3)/144/144B/153A/153C) or reassessment (u/s 147/148) or recomputation or revision of income under the Act has been completed for the relevant assessment year subsequent to filing of such returns of income.
4. All subsequent effects under the Act, including issue of refund along with interest as applicable, shall also follow in these cases. In those cases where PAN-Aadhaar linkage is not found, refund of any amount of tax or part thereof, due under the provisions of the Act shall not be made as laid down in Circular No.03/2023 dated 28.03.2023 vide F.No.370142/14/2022-TPL.
5. The Director General of Income-tax (Systems), Benglauru shall specify the procedures for processing of such returns filed u/s 119(2)(b) of the Act to ensure that intimation u/s 143(1) of the Act shall be sent to assessees on or before 31.03.2026.
6. This may be brought to the notice of all for necessary compliance.
(Dr. Indu Bala)
Deputy Secretary to the Government of India
