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CA Umesh Sharma

CA Umesh SharmaArjuna (Fictional Character): Income Tax Department has issued Circular No. 09/2015 dated 9th June, 2015 regarding income tax refund. Taxpayer wants Refund of excess of Income Tax paid as early as possible. Then today please tell me about income tax refund and about this circular. The one who have not received the income tax refund feels that his Kahani is Aadhuri.

Krishna (Fictional Character): Arjuna, Very well said, it becomes difficult for taxpayer to pay tax but in case of Refund he wants it immediately. Income tax department verifies income tax return filed through Computer and if there is refund then it will be credited to Bank Account mentioned in return through ECS and if liability arose then a notice is sent to taxpayer for making payment of Tax. Majority of Returns were verified by this process and others come under the Scrutiny.

Arjuna: Krishna, when refund arises in Income Tax?

Krishna: Arjuna, if taxpayer has paid excess Advance Tax or Self-Assessment Tax or if TDS is deducted more than tax payable by him then refund arise. E.g. 1) if a Businessman suffers losses in Business and his TDS is deducted then he can claim refund of TDS deducted. 2) Salaried Employee can also claim refund if TDS is deducted more than tax payable by him.

Arjuna: Krishna, what taxpayer should do if he filed return but does not get Refund or received less refund?

Krishna: Arjuna, Status of income tax return filed by taxpayer is shown on the Income Tax Departments website. Every Taxpayer should check his Status. Non receipt or less receipt of Refund occurs due to following reasons:

  1. If Refund received is less than claimed then taxpayer should verify it from intimation and if reason of short refund is not acceptable then rectification will have to be filed. Income Tax Department will process refund on the basis of rectification.
  2. If taxpayer has given wrong information in the income tax return like bank account number or IFSC code, etc. then refund will not be received. For availing the refund taxpayer has to give correct information through online refund re-issue request.
  3. Sometimes Department adjusts refund of one year against demand of other year so no refund or less refund is received. Taxpayer should verify it and take appropriate decision.

Arjuna: Krishna, what if Taxpayer has not filed Income Tax return and if there is Refund?

Krishna: Arjuna, According to provisions Taxpayer can file returns only for previous two years but if he has refund before the last two previous year and has not filed return then he has to make an Application of Delay Condonation by mentioning reasons of delay. If Application is accepted then he may get refund after the completion of process.

Arjuna: Krishna, what is mentioned in the Circular of Income Tax Department dated 9th June, 2015?

Krishna: Arjuna, Taxpayer can claim refund by filling Condonation Application if he has not filed return and he has Refund according to section 119(2) (B) of Income Tax Act. The rules and procedure for filling the application is mentioned in the circular. Following are the major points:

1)      Condonation Application can be file up to six previous years.

2)      The Income Tax Commissioner / Board are vested with power of accepting or rejecting the application. The decision on the application shall be declared within 6 months from the end of the Month in which the application is received.

3)      At the time of Accepting or rejecting the application it is the duty of the Commissioner to ensure that income/loss declared or refund claimed is correct and genuine.

4)      The Income Tax officers have been empowered to direct necessary Scrutiny and Enquiries to check the correctness of amount of claim.

5)      The power of accepting or rejecting the Condonation Application of Delay shall be subject to following Condition:

a)      The Income of Assessee is not assessable in the hands of other person under any provision of Income Tax Act.

b)     No Interest will be admissible on belated claim of Refunds.

c)      The Refund has arisen due to excess payment of Advance Tax or Self-Assessment Tax or due to excess deduction of TDS.

Arjuna: Krishna, what one should learn from this?

Krishna: Arjuna, everyone wants money. It is difficult for any person to give money but anyone will be ready to receive. Similar is in case of Tax. If taxpayer has not claimed previous years Refund then he should claim that by filling application. Taxpayer should claim proper and genuine refund otherwise it may come to be payable under the Scrutiny notice. Status should be verified if Return has been filed. If less refund is received then it should be checked and decision should be taken. Further income tax department should also give the correct refund and should let the taxpayer feel relief. If the taxpayer has not filed income tax return and so not received income tax refund or has filed return but not received refund then by following above methods he can get the refund and his Adhuri Kahani can be completed.


Author Bio

1. Central Council Member of ICAI. 2. Vice-Chairman of WIRC of ICAI for the period 2015-2021. 3. Youngest Chairman of Aurangabad Branch of WIRC of ICAI in 2002. 4. Author of Popular Tax articles series based on Krishna and Arjuna conversation i.e “KARNEETI” published in Lokmat on every View Full Profile

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  1. NIRAV SHAH says:

    It is interesting to note that the income tax department has introduced limitation period for claiming refund which has not been received by the assessee, however that is not so in case of demands. The demands pertaining to more that even 10 years are still recovered by adjusting the same against refund of subsequent years. The concept of OUTSTANDING TAX DEMAND and response to same has started recently, which was not so earlier. In many casese assessee’s were not aware about any outstanding tax demand against them so obviously the rectification was not filed. To the best of surprise, now all these assessee’s will have to trace their income tax related papers of 10 years old or more to file rectification.

  2. rakesh kumar jain says:

    IT refund is pending for FY 2009-10. I have not filed request for refund as I was
    not aware that I must file request for refund as I was expecting that refund must
    be paid automatically. Kindly let me know how to file refund for FY 2009-10 (the return was filed manually). Thanking you. Best regards, RAKESH (rkj951@yahoo.com)


    Date : 15.06.2015

    Dear Sir

    Thanks for yr nice article.Everyone wants money in any way not from income tax only-anytime.But at the same time they havent willing to pay any tax not only income tax, theyare not willing excise duty,service tax (especially) vat cst etc. or any kind without benefit.Benefit means it should be understood in any manner.


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