A Guide to Income Tax Refund process

All about Income Tax Refund process:

Income tax refund

Mr. Raj Malhotra, an IT Professional files his Income Tax Return every year on time. He filed his ITR through paper mode for the Assessment year 2015-16, and the Income Tax amount which he paid was higher than the amount computed by the Income Tax Department. As a result, he was entitled to a “Tax Refund”. Mr. Raj  wanted to check the status of his refund as he did not receive the refund amount even after three months of filing ITR.

There have been lots of similar cases related to tax refund grievances especially where the taxpayer has filed his/her ITR through paper mode. Due to the rise in such cases, Central Board of Direct Taxes in May 2016, directed the Income Tax Department to process all such pending cases in 15 days instead of stipulated timeline of 30 days.

To help the taxpayers check their “Tax Refund” status, Income Tax Department introduced the “Refund Banker Scheme” which was commenced on Jan 24, 2007. The scheme is operational for Non-corporate taxpayers assessed in Bangalore, Mumbai, Delhi, Kolkata, Chennai, Pune, Bhubaneswar, Cochin, Hyderabad, Patna, Ahmedabad, Kanpur, Chandigarh, Trivandrum and Allahabad.

Under this scheme, Income Tax Department has appointed State Bank of India (SBI) as a “Refund Banker” for the distribution of tax refunds to the taxpayers. The refunds generated on the processing of ITR by the Assessing Officer/ CPC- Bangalore is passed on to State Bank of India (SBI), CMP Branch, Mumbai (Refund Banker) on the next day of processing.

With the introduction of Aadhaar-based ITR verification, tax refund process have become faster. This has also worked in the favor of the taxman as they have been able to process the refunds to the eligible taxpayers in their bank account in less than 15 days.

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How to view Refund/Demand status?

You can check the refund status 10 days after the refund has been sent by the Assessing Officer to the “Refund Banker”, by entering your “PAN/TAN” and “Assessment year” on the link below:

Click here to check your Income Tax refund status

In case of ITR being filed online, you can view the status of your tax refund by following the steps below:

1. Login to e-Filing website with your User ID and password using the link below:

Click here to login to e-Filing website

2. Click on the “My Account” tab and in the drop-down list, select ” Refund/Demand Status”.

Below is the attached screenshot for your reference:

Refund or Demand Status

3. Following details will appear on this page:

• Assessment Year
• Status
• Reason (For Refund failure if any)
• Mode of Refund payment

Mode of Tax Refund

The refund is made either through electronic mode i.e. direct credit to your account or through the cheque mode. You are, therefore required to provide bank account number, IFSC code and complete address details along with the PIN code at the time of filing returns.

Refund through cheque mode is sent directly to the address mentioned at the time of filing returns, through Speed Post.

Note: “Refund paid” status is also being reflected in the “Tax Credit Statements” in Form 26AS.

FAQs on Tax Refund

1. What should be done if the TIN (Tax Information Network) status shows that the Refund has expired?

If the refund is not presented for payment within the valid tenure of 90 days, then the refund status is marked as expired or cancelled. You have to raise “Refund Re-issue” request in such a scenario. If you have filed the return electronically, you can raise the “Refund Re-issue” request on the Income Tax e-filing website. You have to enter the below details and validate the details for submitting the request:

• PAN
• Assessment Year
• CPC Communication Reference Number
• Refund Sequence Number (as per CPC Order)

Below is the attached screenshot for your reference:

Refund Re-issue RequestNote: If you have filed your return offline, you need to contact the Assessing Officer under whose jurisdiction the return had been filed to re-initiate the refund.

2. What should be done if the TIN (Tax Information Network) status shows that the Refund has been returned?

It means that the refund has been returned undelivered by Speed Post. All returned refunds are cancelled and retained at the CMP Centre. You have to raise ” Refund Re-issue” request in such a scenario.

If you have filed the return electronically, you can raise the “Refund Re-issue” request on the Income Tax e-filing website. You have to enter the below details and validate the details for submitting the request:

• PAN
• Assessment Year
• CPC Communication Reference Number
• Refund Sequence Number (as per CPC Order)

Note: If case of a return being filed offline, you need to contact the Assessing Officer under whose jurisdiction the return was filed for re-initiation of refund.

Also read: A Guide to handle a notice for Non-Filing of Income Tax Return

3. Filed your ITR electronically but have not received the refund yet?

You may have not received your refund due to any of the below reasons:

Your ITR has not been processed yet: Once your ITR is processed, you may receive a refund (if any). You can check the status of your ITR by logging into the Income Tax e-filing website and clicking on the “e-Filed Returns/Forms” under the “My Account” tab.

Here is the screenshot for your reference:

e-Filed returns or formsYour ITR has been processed, but there was no refund determined by the Income Tax Department.

Your ITR was processed and the refund was determined but the credit could not reach you: This could be due to the incorrect bank details in case of ECS credit, incorrect address or no one available at home in the event of refund cheque being sent to the address mentioned at the time of filing ITR.

If you want to change your address, email id or mobile number, you can update your contact details by logging into the Income Tax e-filing website and clicking on “My Profile” under the “Profile Settings” tab.

Here is the screenshot for your reference:

My Profile4. How can you rectify the mistakes like name, account number, etc. on the refund cheque which is already delivered to you?

If you have filed the return online, you can modify the account number and raise the “Refund Re-issue” request by logging into the Income Tax e-filing website.

In case of offline filing of return, you can send the original refund cheque to the address mentioned below for the cancellation of cheque:

CMP Operations Centre,
State Bank of India,
Survey No. 21, Opposite to Hyderabad Central University, Main Gate
Gachibowli, Hyderabad -500019

Along with the cheque, you have to send a letter highlighting the mistakes on the refund cheque and update the cancellation status on TIN. Once the status is updated as “returned”, you may contact Ward Assessing officer for rectification of the name/account number and re-initiation of refund.

5. What if the TIN status is “Refund was processed through Direct Credit mode that has failed”?

This could possibly be due to any of the below-mentioned reasons:

• Operations in the account have been stopped/restricted/ On Hold
• The account may be a fixed deposit or loan of PPF account
• Account may be an NRI account
• Account may be closed
• The account holder may be deceased

In such a scenario, if you have filed the return online, you can modify the account details and raise the “Refund Re-issue” request by logging into the Income Tax e-filing website.

In case offline filing, you have to contact the Assessing Officer and provide the correct account details in which the refund has to be credited. Once the account details are updated, the refund will be re-initiated by the Assessing Officer.

6. What if the TIN status is: “Refund was processed through NECS/NEFT mode has failed”?

You need to check the account number, MICR/IFSC code provided at the time of filing the return. You can either update the account details online or raise the “Refund Re-issue” request by logging into the Income Tax e-filing website or you may contact the concerned Assessing Officer for modification of the account details and re-issue of refund if you have filed your return offline.

Also read: All about Income Tax Scrutiny Notice

7. What is meant by “Refund has been adjusted against the outstanding demand of previous year”?

It implies that the refund for the current year has been adjusted against the outstanding demand of previous Assessment year either partially or in full. To know the details of the outstanding demand in case of paper filing of returns, you are required to contact the Ward Assessing Officer/CPC Bangalore.

If you have e-Filed the returns, you can make an enquiry on the Income Tax e-filing website by following the steps below:

• Login to the Income Tax e-filing website.
• Hover your mouse over the “Helpdesk” tab and click on the “Submit Grievance”.
• Select the first option “CPC [ITR-V/ Processing/ Refund/ Rectification/ Communication/ Demand” and click on “Continue”.
• In the next page, you have to select the Assessment year, Category and Sub Category, enter the Acknowledgement Number and Refund Sequence Number. Click on ” Submit”.

Below is the screenshot for your reference:

Submit Grievance8. Where can I contact for refund related queries?

You may also check the status of your refund by contacting the numbers listed below:

• For payment related queries, you need to contact SBI Contact Centre Toll Free No- 1800-425-9760
• In case of any modification in refund record processed at CPC Bangalore, you may contact on the Toll Free No- 1800-425-2229 or 080-43456700
• You may also contact on Aayakar Sampark Kendra Toll Free no. 1800-180-1961 or email at refunds@incometaxindia.gov.in

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Final Words

So if you are looking for quick Income Tax Refund, it is advisable to file your ITR online and on time. Also, make sure that you provide the correct bank details while filing your ITR as the refund amount will be deposited directly into your bank account. Don’t forget to choose the correct ITR form for filing the returns and provide correct TAN of TDS deductor.

In case of any discrepancies or delay in TAX refund, you may contact on the numbers listed above.

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