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India's Tax Refund Backlog Persists as AI Flags Rs 700 Crore in Suspect Claims

Larger payouts are under extra verification, extending timelines for high-value filers.

Overview

  • As of September 22, about 7.58 crore returns were filed, 6.86 crore verified and 5.01 crore processed, leaving roughly 1.86 crore pending.
  • The tax department says ongoing probes into questionable deductions are slowing processing, with refunds above Rs 10 lakh facing extended checks.
  • Refund disbursals up to September 17 total Rs 1.60 lakh crore, about 24% lower than Rs 2.10 lakh crore a year earlier by the same date.
  • Since July, notices have led to withdrawals of Rs 963 crore in false claims, disclosures of foreign assets worth Rs 29,208 crore and additional tax payments of Rs 409.50 crore.
  • Experts note fully automated screening flags mismatches and unusual deductions, so simple salary-only cases clear faster, while PAN–Aadhaar or bank detail errors and portal glitches can also delay credits.