Income Tax Refund for AY20-21 may be delayed. Here’s Why?

Income Tax Refund for AY20-21 may be delayed. Here's Why?

On the off chance that you have filed your Income Tax Return (ITR) for the Assessment Year (AY) 2020-21 and haven’t got the refund so far, you are not alone. A technical upgrade for faster processing of the Income Tax Returns could be the reason behind the delay. Many Taxpayers, even the individuals who filed their tax returns in the period of June or July, took to Twitter to voice their concerns over the refunds. Putting the onus on the specialized issues, the I-T Department tweeted “As part of our commitment to provide improved taxpayer services, we are moving to a new, technologically upgraded platform (CPC 2.0) for faster processing of ITRs. ITRs for AY 2020-21 will be processed on CPC 2.0. We thank you for your patience while we migrate to the new system.”

The tweet didn’t specify any timetable on when it will move to CPC 2.0 and begin preparing the I-T returns for AY20-21. All the income tax returns filed with the department are prepared at the CPC or centralized processing of the I-T office at Bengaluru as of now. Under CPC 2.0 project, the tax department is expanding its ability and upgrading technology to offer better types of services to the citizens through prefilled forms and reducing time for refunds.

In an ongoing tweet, the I-T division said that it has so far issued Rs.1,36,066 crore to more than 40.19 lakh citizens between April 1, 2020, and November 17, 2020. This incorporates a personal income tax refund of Rs. 35,750 crore gave in 38,23,304 cases and corporate tax refunds of Rs.1,00,316 crore gave in 1,95,518 cases. Many taxpayers answered the tweet and complained about not receiving the refunds. According to some experts, the delay could be possibly due to covid-induced disruptions, which has strained the exchequer.

Generally, the refunds are automatic and are received within 3-4 months after filing the income tax returns in case there is no major deficiency in the return. However, this year we understand that the government has a liquidity crunch due to extra spending due to the covid-19 crisis, and also the collection has been subdued. This could be a possible reason for the delay. Now, with the economic activity rising and GST collections also becoming robust, the CBDT should plan for processing refunds less than Rs.1 Lakhs.

A few specialists additionally accept that the tax department ought to get more transparency by giving the timetable for which the refunds have been issued. In order to increase transparency, the CBDT should process the returns in chronological order and disclose the details of the date till which the income tax returns filed and consequently refunds have been processed and issued. A dashboard on its website showing the date till which refunds issued, date and acknowledgment number of returns processed, and the number of returns filed and pending for processing will be helpful for taxpayers and bring in transparency.

For more information, visit the website of All India ITR.


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