Taxpayers to get pending income tax refunds for FY2020-21 by April 30

Subsequently, the income-tax department issues an intimation notice under section 143(1) of the Income-tax Act, 1961.

This notice serves as confirmation that the filed ITR has been successfully processed, often followed by the crediting of the refund amount, if applicable.

However, some taxpayers find themselves in a state of limbo, awaiting the processing of their ITRs for income related to FY 2020-21 (AY 2021-22).

The delayed cases primarily pertain to individuals who filed their returns on time but have yet to receive their entitled refunds.

The CBDT acknowledged, "It has been brought to our notice that due to certain technical issues or for other reasons not attributable to the assesses concerned, several returns for assessment year (AY) 2021-22, which were otherwise filed validly, could not be processed under sub-section (1) of section 143 of the Act. Consequently, intimation regarding processing of such returns could not be sent within the timeframe prescribed under sub-section (1) of section 143 of the Act. This has led to a situation where the taxpayers are unable to get their legitimate refund in accordance with provisions of the Act, although the delay is not attributable to them."

Meanwhile, the deadline for submitting an updated income tax return (ITR) for the financial year 2020-21 is approaching on March 31, 2024.

This provision, introduced by the Finance Act of 2022, allows taxpayers who missed filing their return for the said financial year or failed to report any income to file an updated ITR or ITR-U.

An updated return can be filed within 24 months (two years) from the end of the relevant assessment year (subject to certain conditions).

Hence, if taxpayers missed filing it for FY2020-21, they can do the same now till March 31.