The government has clarified that the Income Tax Department will release all pending income tax refunds up to Rs 5 lakh immediately. All pending GST and Custom refunds will also be cleared.
IT Department to release
all pending income tax refunds up to Rs 5 lakhs immediately; Around 14 lakh
taxpayers to benefit
All GST & CUSTOM
refunds also to be released; to provide benefit to around 1 lakh business
entities including MSMEs
Rs 18,000 crore of total
refund granted immediately
A press note dated 08.04.2020 from the Ministry of Finance stated that in the context of the COVID-19 situation and with a view to provide immediate relief to the business entities and individuals, it has been decided to issue all the pending income-tax refunds up to Rs. 5 lakh, immediately. This would benefit around 14 lakh taxpayers.
It is not clear whether Rs. 5 lakh limit is per assessment year or in aggregate for all the pending assessment years for a particular assessee.
It may be remembered that in February 2019, the Income Tax department had announced that effective 1st March 2019 all the income-tax refund will be made in e-mode only. That is income-tax refund will not be made in cheques and will be directly credited to the assessee’s bank account. For this purpose, linking bank accounts with the PAN of the assessee was made mandatory and failing which no refund will be made to the assessee.
Hence, paper refund - refund by cheques, by draft has been restricted by the income tax department. Only in exceptional circumstances, paper refund or refund by cheques will be issued and that too after due approval, as instructed by the CBDT in this regard.
However, in many cases, it is seen that despite successful linking of PAN and Bank account and prevalidation of bank account, refund failed to get credited in that bank account and the reason cited was 'PAN not linked to the bank account'.
Recently, in the Parliament, Minister of State for Finance Anurag Thakur informed the Lok Sabha that for Income tax refunds prior to assessment year (AY) 2019-20, refunds are pending only in 33,175 cases which is 0.0001% of the total refund claims for these AYs.
Read
the reply of the Minister:
Government Shares Interesting Data showing Faster Income Tax Refunds
Government Shares Interesting Data showing Faster Income Tax Refunds
He further informed that For AY 2019-20, out of 2.3 crore ITRs with refund claims, refunds have been processed in 2.21 crore cases which is 92% of the cases.
The circular further states that it had also been decided to issue all pending GST and Custom refunds which would provide benefit to around 1 lakh business entities, including MSME.
This will cost approximately Rs. 18,000 crore to the exchequer, the circular said.
Read the full text of the press note.
Government of India
Ministry of Finance
Department of Revenue
New Delhi, the 08th April, 2020
PRESS NOTE
In the context of the COVID-19 situation and with a view to provide immediate relief to the business entities and individuals, it has been decided to issue all the pending income-tax refunds up to Rs. 5 lakh, immediately. This would benefit around 14 lakh taxpayers.
It has also been decided to issue all pending GST and Custom refunds which would provide benefit to around 1 lakh business entities, including MSME. Thus, the total refund granted will be approximately Rs. 18,000 crore.
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