Refund Claim After Condonation of Delay: Section 119(2)(b) in AY 2026-27
TL;DR
- Section 119(2)(b) of the Income Tax Act allows the CBDT to condone delay in filing a refund claim if you missed even the belated and updated return windows.
- The application has to be made within 6 years from the end of the relevant assessment year, with a maximum refund limit per the latest CBDT circular.
- The Principal Commissioner of Income Tax (Pr. CIT) decides claims up to Rs. 50 lakh; CBDT decides larger claims.
- You must show genuine hardship — illness, overseas relocation, missed compliance due to a verifiable cause.
- Interest under Section 244A is not generally granted on condonation-route refunds, but the principal refund is fully claimable.
What this means in plain terms
The Indian tax system gives you multiple deadlines to file a return — the original due date (usually 31 July), the belated date (31 December), the updated return window (24 months in AY 2026-27 under Section 139(8A)). What people often do not realise is that even after all these deadlines lapse, there is one final route to recover a refund — Section 119(2)(b).
This section gives the CBDT a discretionary power to "condone" the delay in claiming a refund or carry-forward of loss. It is not automatic, you must apply, and the application has to clearly explain why you could not file in time. The route is used most often by taxpayers who fell ill, relocated abroad, or genuinely did not know they had a refund waiting. The 6-year window is generous, but the process requires patience.
When Section 119(2)(b) applies
Belated and updated windows already closed
The condonation route is invoked only after all normal filing windows are exhausted. For AY 2026-27, the original deadline is 31 July 2026, belated until 31 December 2026, and updated return until 31 March 2029. If you miss all three, Section 119(2)(b) becomes the last resort.
Refund claim — not just any return
The section specifically covers cases where the delayed filing would result in a refund, or where carry-forward of a loss is being claimed. It does not condone delay where you owe tax — penalties under Section 234F continue to apply in those cases.
Six-year limit from end of AY
The application has to be made within 6 years from the end of the relevant assessment year. So for AY 2020-21 (FY 2019-20), the outer limit is 31 March 2027. Beyond this, the refund is generally lost forever.
Who decides your application
Pr. CIT for refunds up to Rs. 50 lakh
The Principal Commissioner of Income Tax (Pr. CIT) or Commissioner of Income Tax (CIT) has the authority to decide applications where the refund claimed does not exceed Rs. 50 lakh for any one assessment year.
CBDT for refunds above Rs. 50 lakh
Where the refund or loss carry-forward exceeds Rs. 50 lakh, the application is decided by the Central Board of Direct Taxes itself, typically through the Member (IT).
Decision timeline
CBDT Circular 9/2015 (and successor circulars) directs that applications should be decided within 6 months of filing. In practice, decisions take 6–18 months depending on complexity.
What constitutes a valid reason
Medical hardship
Prolonged illness, hospitalisation, mental health treatment, or disability that prevented filing is the most common ground. Medical certificates and hospital records are essential.
Overseas relocation
Posting abroad, especially short-notice transfers, with the original taxpayer unable to access Indian portal credentials or files. Supporting letters from the employer help.
Death of taxpayer
Where the original taxpayer has passed away and the legal heir discovered the unclaimed refund years later. This category has its own streamlined process.
Genuine ignorance
In limited cases, where the taxpayer was a senior citizen with no taxable income previously and TDS was deducted by mistake — courts have accepted ignorance as a valid ground.
What does not work
Reasons that are typically rejected — "I forgot," "I was busy," "I did not know," without a documented underlying cause. The CBDT looks for something specific and verifiable.
How to file the application
Step 1 — Draft the application
Address it to the Pr. CIT having jurisdiction over you (or CBDT if the refund exceeds Rs. 50 lakh). Use plain English, mention the AY, the refund amount, the reason for delay, and the supporting documents.
Step 2 — Attach supporting documents
Identity proof (PAN, Aadhaar), Form 26AS or AIS for the relevant AY, computation of refund, TDS certificates, medical records or relocation letters, and a sworn affidavit if required.
Step 3 — Submit physically and via portal
Physical submission to the Pr. CIT office is still common. Some jurisdictions accept online submission via e-Nivaran on incometax.gov.in. Get the acknowledgement.
Step 4 — File the actual ITR after approval
Once the condonation is granted, you receive an order directing you to file the return within a stipulated time (usually 60 days). File the ITR using the offline utility for the relevant AY, mentioning the order number under Section 119(2)(b).
Step 5 — Wait for CPC processing
CPC processes the return as a normal one, issues the Section 143(1) intimation, and credits the refund to your pre-validated bank account.
A real example
Suresh, 67, Rs. 12L pension, Kochi. Suresh, a retired Kerala State government officer, had Rs. 87,000 of TDS deducted on his pension for FY 2019-20 (AY 2020-21). He underwent prolonged cancer treatment from August 2020 to mid-2022 and never filed his return. By the time he recovered, the belated and updated return deadlines had passed.
Here is what he did:
- Engaged a chartered accountant who advised him about Section 119(2)(b) condonation.
- Drafted an application to the Pr. CIT, Kochi, attaching medical records, hospital discharge summary, and Form 26AS showing the TDS.
- Computed the refund — total income below taxable limit even before deductions, so the entire Rs. 87,000 was refundable.
- Submitted the application physically to the Pr. CIT office in February 2026.
- Received the condonation order in August 2026 directing him to file the return within 60 days.
- Filed the ITR-1 for AY 2020-21 using the offline JSON utility, citing the order number.
- CPC processed it in November 2026 and credited Rs. 87,000 (without Section 244A interest) to his pre-validated SBI account.
The lesson — even years after the deadline, refund claims are not necessarily dead. Section 119(2)(b) is the safety net for genuine hardship cases, and the 6-year window gives meaningful time to recover.
What to do this week
- Check old Form 26AS or AIS for any year where TDS was deducted but you did not file an ITR — refunds may be sitting unclaimed.
- If you missed any filing within the 6-year condonation window, gather documents showing the reason for the delay.
- Draft a Section 119(2)(b) application addressed to your Pr. CIT, citing the specific AY, refund amount, and grounds.
- Pre-validate at least one bank account on incometax.gov.in so any condonation-route refund can be credited later.
- Run the 6-step assessment at https://myfinancial.in to see your old-vs-new regime delta, unused deductions, and insurance gap in under 10 minutes.
FAQ
Can I claim refund interest under Section 244A on condonation cases?
Generally no. CBDT circulars and judicial precedents have held that interest under Section 244A is not payable where the delay is on the taxpayer's side. Only the principal refund is granted.
What is the maximum refund I can claim through Section 119(2)(b)?
There is no explicit cap, but applications above Rs. 50 lakh go to the CBDT directly and take longer. Most retail cases are well within Pr. CIT authority.
Can I file my return first and then apply for condonation?
No. The condonation must be granted before you file. Filing first means the system will reject the return as time-barred. The CBDT order specifies the window for filing.
Is the Pr. CIT's decision final?
The Pr. CIT's order can be challenged via writ petition in the High Court if rejection is arbitrary or against principles of natural justice. Several cases have succeeded on this ground.
Does Section 119(2)(b) cover loss carry-forward claims?
Yes. The section also condones delay in claiming carry-forward of losses, subject to the same 6-year window and discretion.
What if I am claiming refund for multiple years?
File one application covering all relevant years, with separate computations for each. The Pr. CIT can dispose of them together.
Are private salaried employees eligible?
Yes. The provision applies to all categories of taxpayers — salaried, self-employed, senior citizens, NRIs — as long as the grounds are genuine.
Sources
- https://incometax.gov.in
- https://incometaxindia.gov.in/Pages/acts/income-tax-act.aspx
- https://www.cbdt.gov.in
- https://www.incometax.gov.in/iec/foportal/help/all-topics/condonation-of-delay
- https://incometaxindia.gov.in/communications/circular/circular9_2015.pdf
This is general information, not personalised advice. For your situation, consult a Certified Financial Planner.
