After weeks of delays that triggered widespread taxpayer complaints, income tax refund processing has gathered pace. According to a Moneycontrol report, professionals have indicated a sharp rise in payouts over the past 24 hours, particularly in high-value cases.
The development comes after concerns over slow processing timelines. Minister of State for Finance Pankaj Chaudhary told the Parliament recently that around 8.8 crore income tax returns had been filed up to February 4, with nearly 24.64 lakh returns pending processing for more than three months.
Experts on I-T refunds
Chartered accountants said many individuals and businesses received refunds overnight and on Friday morning. CA Himank Singla, Partner at SBHS & Associates, told Moneycontrol, “There has been a noticeable acceleration in refund issuance, with several clients receiving substantial amounts, including refunds in the range of ₹15-17 lakh.”
Experts noted that while the recent payouts provide relief, a number of high-value refunds are still pending and are likely to be cleared in upcoming processing cycles, the report stated. Refunds are being issued in batches based on timelines followed by the Centralised Processing Centre (CPC).
What is the legal processing time?
Under the Income Tax Act, intimation under Section 143(1) must be issued within nine months from the end of the financial year in which the return is filed. For returns filed in FY 2025-26, the processing deadline extends until September 30, 2026.
Success of NUDGE campaign
The Non-Intrusive Usage of Data to Guide and Enable (NUDGE) campaign involves sending targeted communications to select taxpayers, encouraging them to review and update their already filed returns. Taxpayers are identified through advanced risk analysis that flags possible underreporting of income or assets, incorrect disclosures or excess claims of deductions and exemptions.
In a written reply to a question in the Rajya Sabha, Pankaj Chaudhary said that the NUDGE campaign had led to the filing of 1.11 crore updated or revised income tax returns over the past two years, resulting in additional tax payments of Rs 6,976.50 crore. He added that the net refund claims adjusted against reduced refunds and additional taxes paid in December 2025 amounted to Rs 1,834 crore.
Overall, the total revenue impact of the initiative stood at Rs 8,810.59 crore.