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Procedure for Filing a Delayed Refund of Tax Claim

In supersession of all earlier Instructions/Circulars/Guidelines issued by the Central Board of Direct Taxes (the Board) from time to time to deal with the applications for condonation of delay in filing return claiming refund under section 119(2)(b) of the Income-tax Act, (the Act), the CBDT has issued Circular No. 9/2015 dated 9.6.2015 containing comprehensive guidelines on the conditions for condonation and the procedure to be followed for deciding such matters.

1. Principal Commissioner or Commissioner vested with the power of acceptance/ rejection of delayed application of refund provided claim is not more than Rs. 10 lakh for any assessment year:

The Principal Commissioners of Income-tax/Commissioners of Income-tax (Pr.CsIT/ CsIT) shall be vested with the powers of acceptance/rejection of delayed applications of refund if the amount of such claims is not more than Rs. 10 lakhs for any one assessment year.

2. Principal Chief Commissioner or Chief Commissioner vested with the power of acceptance/ rejection of delayed application of refund provided claim is more than 10 lakh but does not exceed Rs. 50 lakh for any assessment year:

The Principal Chief Commissioners of Income-tax/Chief Commissioners of Income-tax (Pr.CCsIT/CCsIT) shall be vested with the powers of acceptance/rejection of delayed applications of refund if the amount of such claims exceeds `10 lakhs but is not more than ` 50 lakhs for any one assessment year.'Refunds of Tax ' to Assessee Under Section 237 to 241

3. Claim of Refund Exceeding Rs. 50,000:

The applications/claims for amount exceeding `50 lakhs shall be considered by the Board.

4. Application for condonation of delay in making refund claim cannot be entertained beyond a period of 6 years

No condonation application for claim of refund shall be entertained beyond six years from the end of the assessment year for which such application is made. This limit of six years shall be applicable to all authorities having powers to condone the delay as per the above prescribed monetary limits, including the Board.

5. Time limit for disposal of condonation application of refund

A condonation application should be disposed of within six months from the end of the month in which the application is received by the competent authority, as far as possible.

6. Exclusion of certain period while calculating period of six years

In a case where refund claim has arisen consequent to a Court order, the period for which any such proceedings were pending before any Court of Law shall be ignored while calculating the said period of six years, provided such condonation application is filed within six months from the end of the month in which the Court order was issued or the end of financial year whichever is later.

7. Conditions for acceptance/rejection of the application

The powers of acceptance/rejection of the application within the monetary limits delegated to the Pr.CCsIT/CCsIT/Pr.CsIT/CsIT in case of such claims will be subject to following conditions:

  1. At the time of considering the case under section 119(2)(b), it shall be ensured that the income/loss declared and/or refund claimed is correct and genuine and also that the case is of genuine hardship on merits.

  2. The Pr.CCIT/CCIT/Pr.CIT/CIT dealing with the case shall be empowered to direct the jurisdictional assessing officer to make necessary inquiries or scrutinize the case in accordance with the provisions of the Act to ascertain the correctness of the claim.

8. Belated application for supplementary claim of refund

A belated application for supplementary claim of refund (claim of additional amount of refund after completion of assessment for the same year) can be admitted for condonation provided other conditions as referred above are fulfilled.

9. Additional conditions applicable for claim/supplementary claim of refund

The powers of acceptance/rejection within the monetary limits delegated to the Pr.CCsIT/CCsIT/ Pr.CsJT/CsIT in case of returns claiming refund and supplementary claim of refund would be subject to the following further conditions:

  1. The income of the assessee is not assessable in the hands of any other person under any of the provisions of the Act.

  2. No interest will be admissible on belated claim of refunds.

  3. The refund has arisen as a result of excess tax deducted/collected at source and/ or excess advance tax payment and/or excess payment of self-assessment tax as per the provisions of the Act.

10. Time limit of 6 years for making refund claim not applicable in case of interest from 8% Saving Taxable Bonds, 2003 if accounted on mercantile basis:

In the case of an applicant who has made investment in 8% Savings (Taxable) Bonds, 2003 issued by Government of India opting for scheme of cumulative interest on maturity but has accounted interest earned on mercantile basis and the intermediary bank at the time of maturity has deducted tax at source on the entire amount of interest paid without apportioning the accrued interest/TDS, over various financial years involved, the time limit of six years for making such refund claims will not be applicable.

 
 
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