The Central Board of Direct Taxes (CBDT) has released Circular No. 07/2025, dated June 25, 2025, to address delays in processing Income Tax Returns (ITRs) filed after the normal deadline under the condonation of delay provisions. With this notification, the CBDT has extended the deadline for processing such delayed but condoned returns to March 31, 2026, giving taxpayers a fair chance to receive their rightful refunds and closure.
What is Condonation of Delay?
Under Section 119(2)(b) of the Income Tax Act, if a taxpayer misses the deadline to file an ITR, they are not automatically disqualified from doing so. Instead, they can apply to the Income Tax Department for condonation of delay, provided the reason for delay is genuine and beyond their control, such as a serious illness, technical failure, or a court order.
Once the application is approved by the Competent Authority, the taxpayer can legally file their return even after the statutory deadline. This ensures that deserving taxpayers do not lose out on refunds or other tax benefits due to circumstances beyond their control.
Approval is granted based on internal guidelines already set forth in previous CBDT circulars, including:
Delayed Processing of Returns Filed Under Condonation of Delay
While many such delayed returns were filed after obtaining condonation approval, numerous taxpayers never received their refunds or intimation notices. Why?
The reason lies in procedural limitations:
- As per Section 143(1) of the Act, the tax department must process an ITR and issue an intimation within a prescribed time limit (generally 9 months from the end of the financial year).
- However, in many cases where returns were condoned, the deadline had already expired by the time the return was filed.
- Although the department accepted such returns, it was unable to process them, leaving taxpayers in a limbo—no refund, no notification, and no closure.
CBDT extended the Time Limit for Processing of ITRs Filed Under Condonation of Delay
To rectify this procedural lapse and ensure fairness to genuine taxpayers, the CBDT has officially extended the time limit for processing condoned returns filed under Section 119(2)(b).
Here are the key highlights from the order:
What Returns Are Eligible?
Only the following ITRs qualify for this extension:
- Returns filed electronically (online)
- Filed on or before March 31, 2024
- Filed after receiving condonation approval under Section 119(2)(b)
What Will Happen?
- All eligible ITRs will now be processed, and the corresponding intimations under Section 143(1) will be issued.
The new extended deadline for sending these intimations is March 31, 2026.
The Director General of Income Tax (Systems), Bengaluru, has been tasked with setting up the technical and procedural framework to ensure smooth rollout and compliance with the new directive. They will develop and implement necessary IT system changes, monitor the processing workflow and ensure all valid returns are processed and intimations sent on or before March 31, 2026.
The official CBDT Circular regarding the extended deadline to process delayed ITRs filed under condonation (till March 2026) is attached below:
Exclusions and Limitations
It’s important to note that not all condoned returns will be processed under this extension. There are certain conditions and exclusions:
Not Eligible If:
- The relevant assessment year has already completed assessment or reassessment proceedings under:
- The taxpayer’s PAN is not linked to Aadhaar – as per CBDT Circular No. 03/2023, no refunds will be issued without this mandatory linkage.
- The application for condonation was filed beyond five years from the end of the relevant assessment year. (Applicable strictly for requests filed on or after October 1, 2024.)
Refunds and Interest – What You Should Know
Refunds Will Be Issued If:
- The ITR shows a genuine claim for a refund arising due to:
- Excess TDS (Tax Deducted at Source)
- Excess advance tax
- Self-assessment tax
No Interest on Refunds:
Since these refunds are based on condoned late returns, taxpayers will not be entitled to interest on the refunded amount, as per standard provisions.
How to Check If You Are Eligible
Wondering whether your return qualifies under this special window?
Here’s a checklist:
- Was your return filed electronically?
- Was it submitted on or before 31-Mar-2024?
- Did you obtain condonation under 119(2)(b)?
- Was there no assessment/reassessment done for that year?
- Is your PAN linked with Aadhaar?
If you answered Yes to all, your ITR is likely eligible for processing under this extension.
Documentation to Keep Ready
To ensure smooth and timely processing, eligible taxpayers should gather and retain the following:
- Copy of the condonation approval from the Competent Authority
- Acknowledgement of ITR filed
- PAN-Aadhaar linkage status confirmation
- Bank details for the refund credit
- Valid email and mobile number for communication
Timelines to Remember
| Event | Date |
| Last date to file a condoned return (already passed) | March 31, 2024 |
| Last date for CBDT to issue intimation | March 31, 2026 |
| Mandatory Aadhaar-PAN linking | Must be done before refund processing |
| 5-year time bar for condonation (effective from October 2024) | Strictly enforced |
Take Action Now to Claim Your Delayed ITR Refund!
If you filed a delayed Income Tax Return under condonation and are still waiting for your refund, this is your chance to resolve it. With the CBDT now allowing the processing of eligible returns until March 31, 2026, ensure that your PAN is linked to Aadhaar and your documentation is in order. Don’t let this opportunity pass—IndiaFilings can help you check your eligibility, update your records, and track your refund status.
Get in touch with our experts today
FAQs on CBDT’s Extended Deadline for Delayed Condoned ITRs
1. I missed the ITR filing deadline. Can I still get my refund?
Yes, if you filed your ITR electronically under condonation of delay (Section 119(2)(b)) on or before March 31, 2024, and it was approved, your return will now be processed, and a refund may be issued by March 31, 2026.
2. What is Section 119(2)(b) of the Income Tax Act?
Section 119(2)(b) allows taxpayers to file an ITR after the deadline if they missed it due to valid reasons like illness, technical errors, or legal issues. Approval must be obtained from the tax authority (Competent Authority).
3. What kind of delays are considered valid for condonation?
Common reasons accepted include serious illness, system glitches, court proceedings, or other genuine hardships that prevented timely filing.
4. I filed a condensed ITR but didn’t get any refund or update. What happened?
Many valid returns filed under condonation were not processed due to technical deadlines under Section 143(1). The new circular now allows these returns to be processed by March 31, 2026.
5. Is there any action I need to take now?
Yes. Make sure your PAN is linked with Aadhaar—refunds will not be issued without it. You should also ensure your bank details and return status are up to date.
6. Will I get interest on my delayed refund?
No, as per the circular, no interest will be paid on refunds processed under this special extension, even if the refund is delayed.
7. What if my return has already been assessed or reassessed?
If your ITR was already processed under assessment sections like 143(3), 144, or 147, this extension does not apply to you.
8. How can I check if my return qualifies for this extension?
If you filed your ITR electronically on or before March 31, 2024, and it was approved under Section 119(2)(b), your return qualifies—unless it has already been assessed.
9. Do I need to apply again to get my refund processed now?
No new application is needed. The Income Tax Department will automatically process qualifying returns by the new deadline (March 31, 2026), provided all conditions are met.
10. Can IndiaFilings help me check my eligibility and status?
Absolutely. IndiaFilings can assist you in checking your condonation status, PAN-Aadhaar linking, and refund eligibility. Our experts can ensure all necessary steps are complete to avoid further delays.
