According to Chartered Accountant (Dr) Suresh Surana, where an income-tax return is filed on July 31, 2025 (i.e., during FY 2025–26 relevant to AY 2025–26), the Centralised Processing Centre (CPC) is required to process the ITR and issue an intimation under Section 143(1) within 9 months from the end of the financial year in which the ITR is filed, as prescribed under Section 143(1) read with the proviso thereto.
Surana says: “Accordingly, in this case, the statutory time limit available to CPC for processing the return would expire on December 31, 2026.”
Also read: If ITR is not processed by 31 December 2025, you won’t be able to file revised ITR; Here’s what you can do if you have a tax refund claim
What happens if an ITR is not processed by the statutory time line?
Karanjot Singh Khurana, Partner at Lakshmikumaran & Sridharan attorneys, says that once a taxpayer files the ITR, CPC should process the return of income to check for arithmetical accuracy, correctness of claims, consistency of return with audit report etc. The law contemplates that all returns of income should be subject to this processing under Section 143(1).
As per Section 143(1), CPC is duty-bound to process the income-tax returns and issue intimation within 9 months from the end of the financial year in which the said income-tax return is filed.
Khurana says: “If an individual has filed his income-tax return on September 16, 2025, the CPC is required to process the income tax return and issue intimation u/s. 143(1) on or before 31st December 2026 (i.e., within 9 months from the end of the financial year in which the return was filed).”
Also read: Rs 1.5 crore tax refund withheld by Income Tax Dept due to mismatch between ITR and Form 26AS; taxpayer files case, wins in High Court
If CPC does not process ITR within the statutory due date, then you are entitled to seek tax refund on the ITR’s basis
Surana says that if CPC does not process the ITR within this prescribed period (within 9 months from the end of the financial year in which the ITR is filed), it loses the legal authority to issue an intimation under Section 143(1) thereafter.
Surana says: “Once this time limit lapses, the ITR attains finality as filed, and no adjustments under Section 143(1), whether resulting in a demand or otherwise, can be made by CPC. In such circumstances, if a refund is due as per the return, the taxpayer becomes entitled to the refund along with interest under Section 244A, calculated from the relevant date until the date of grant of refund.”
According to Khurana, expiry of the statutory timeline of ITR processing and issuance of intimation u/s. 143(1) by the CPC will deprive the CPC from making any adjustment. Legally, CPC cannot make adjustments under section 143(1) after expiry of the team statutory timeline.
According to Khurana after a taxpayer has made his self-assessment of income and filed the ITR, the CPC is required to process the ITR and issue refunds after the processing of return of income.
Khurana says: “If CPC doesn’t make adjustments within the statutory timeline, the taxpayer is entitled to seek refund of taxes based on the return of income filed by them. In such cases, the taxpayer can consider options such as filing grievance on the portal, filing application of refund before the jurisdictional Assessing Officer or even file a writ before the jurisdictional High Court.”
Chartered Accountant Gopal Bohra, Partner – Direct Tax, N. A. Shah Associates LLP, said to ET Wealth Online: “When the CPC fails to process any ITR within the prescribed time limit and such return is not taken for any assessment or reassessment, the taxpayer becomes entitled to any tax refund which he claimed in the ITR along-with applicable interest under section 244A which will be computed up to the date of grant of such refund.”
Thus upon expiry of statutory timelines, powers under Section 143(1) cannot be exercised by CPC or any other officer. In such cases, the taxpayer should consider options such as filing grievance on the ITR portal, or file an application for tax refund before the jurisdictional Assessing Officer or even file a writ before the jurisdictional High Court to claim refund of taxes.
Also read: 53% interest to be paid by Income Tax dept to an individual’s tax refund of Rs 6.42 lakh; Delhi High Court order
After the statutory time limit to process ITR is over, CPC loses its rights, but tax officer can still access it
Khurana says that it must be noted that the Assessing Officer or the prescribed income tax authority can still initiate the assessment proceedings, wherein the income disclosed, deduction claimed, etc. in the income-tax return can be subject to assessment.
Bohra, said to ET Wealth Online: “If CPC fails to process the tax return within 9 months from the end of the financial year in which the return is filed, such ITR attained finality. However, AO can take such return for assessment or reassessment within the prescribed time limit by issuing notice under section 143(2) or 148 respectively.”
According to Bohra, tax notice under section 143(2) cannot be issued after the expiry of three months from the end of the financial year in which the return is filed. Notice under section 148 can be issued where any income chargeable to tax has escaped assessment for any assessment year.
Bohra said: “The maximum time limit for reopening the assessment is 3 years and 3 months from the end of the relevant assessment where the income chargeable to tax, which has escaped assessment, is less than Rs 50 lakh and 5 years and 3 months where amount likely to be Rs 50 lakh or more.”
Surana says: “The assessment can be initiated by issuing notice u/s. 143(2) within 3 months from the end of the financial year in which the said income-tax return is filed. Separately, the income-tax authorities can also reassess the income disclosed by an Assessee by exercising their reassessment powers under section 147. Thus, while CPC cannot adjustments after expiry of the statutory timeline, the Assessing Officer can still adjust income/taxes by assessing/re-assessing the income.”
Surana says that in cases where an ITR remains unprocessed beyond the statutory timeline, taxpayers may take proactive steps such as raising an online grievance through the e-Nivaran/CPGRAMS mechanism or the e-Filing Portal, or submitting a written follow-up request for processing of the return.
