24.6 Lakh ITRs Pending Beyond 90 Days

In recent developments, the Indian government has highlighted a significant backlog in income tax return (ITR) processing, with over 24.6 lakh ITRs pending beyond 90 days. This issue, revealed in Parliament on February 10, 2026, stems from the massive volume of filings for Assessment Year (AY) 2025-26, where approximately 8.80 crore ITRs were submitted by February 4, 2026. This delay has sparked concerns among taxpayers, particularly those awaiting refunds. Understanding the reasons behind "24.6 Lakh ITRs Pending Beyond 90 Days" is crucial for navigating the tax system effectively. In this guest post, we'll delve into the causes, impacts, government responses, and practical tips to avoid such delays, making your ITR filing smoother and more efficient.

What Is ITR Processing and Why Does It Matter?

Income Tax Returns (ITRs) are annual declarations filed by individuals and entities to report their income, deductions, and tax liabilities to the Income Tax Department (ITD). Once filed, ITRs undergo processing at the Centralized Processing Centre (CPC) in Bengaluru. This involves verification of details against records like Form 26AS (for TDS), Annual Information Statement (AIS), and Tax Information Statement (TIS).

Typically, ITR processing takes 15-45 days after e-verification. However, the law allows the department up to December 31 of the following year (e.g., December 31, 2026, for AY 2025-26) to complete processing. Delays beyond 90 days, as seen in the current scenario of "24.6 Lakh ITRs Pending Beyond 90 Days," often occur due to discrepancies or additional scrutiny. Timely processing is vital because refunds are issued only after completion, and any hold-up can affect financial planning, especially for salaried individuals and senior citizens relying on these funds.

For AY 2025-26, the surge in filings—over 8.79 crore ITRs—reflects growing tax compliance in India. This is a positive trend, with direct tax collections rising steadily, but it also strains the system, leading to backlogs.

The Backlog Breakdown: 24.6 Lakh ITRs Pending Beyond 90 Days

As per the Ministry of Finance's response in the Rajya Sabha, out of 8,79,62,234 ITRs filed for AY 2025-26 by February 4, 2026, exactly 24,64,044 remain unprocessed beyond 90 days. This backlog represents about 2.8% of total filings, a notable figure given the department's push for digital efficiency.

Earlier data from January 2026 showed over 51.77 lakh ITRs unprocessed, indicating gradual progress but persistent issues. The problem isn't new; similar delays were reported in previous years due to high volumes and system upgrades. For context, ITR filings have grown exponentially—from around 7 crore in September 2025 to nearly 8.8 crore by early 2026—driven by better awareness and enforcement.

Key Reasons for ITR Processing Delays

The primary culprit behind "24.6 Lakh ITRs Pending Beyond 90 Days" is the Income Tax Department's technology-driven risk analysis and compliance initiatives. Here's a closer look:

1. NUDGE Campaign: Launched by the Central Board of Direct Taxes (CBDT), the Non-Intrusive Usage of Data to Guide and Enable (NUDGE) campaign uses data analytics to identify mismatches in ITRs, such as unreported foreign assets, incorrect deductions under sections like 80G, 80GGC, or 80E, and excessive exemptions. Taxpayers receive SMS or emails urging revisions by December 31, 2025. This has led to holds on processing until corrections are made.
2. Data Mismatches and Verification: Discrepancies between ITR data and department records (e.g., AIS or Form 26AS) trigger additional checks. High-value refunds (over ₹50,000) face stricter scrutiny to prevent fraud. Late filings or peak-season submissions exacerbate delays.
3. System Overload and Upgrades: The ITR portal has undergone enhancements for better user experience, but these can temporarily slow processing. New tax reforms, including the default new tax regime, add complexity.
4. Other Factors: Errors like incorrect bank details, unverified ITRs within 30 days, or unresolved notices under Section 139(9) or 143(1) also contribute.

These reasons highlight how the department's focus on accuracy and compliance, while beneficial long-term, creates short-term bottlenecks.

Impacts of Delayed ITR Processing on Taxpayers

The "24.6 Lakh ITRs Pending Beyond 90 Days" issue has ripple effects:

• Financial Strain: Delayed refunds mean taxpayers miss out on funds for expenses or investments. Senior citizens, who often depend on interest income refunds, are particularly affected. Although interest at 0.5% per month is payable on delays beyond the due date (under Section 244A), it's small compensation.
• Opportunity Costs: Money tied up in refunds could earn interest elsewhere. For businesses, delays impact cash flow.
• Penalties and Compliance Issues: If delays stem from errors, taxpayers may face notices, penalties up to ₹10,000 for late revisions, or even invalid returns. Non-filers or those ignoring NUDGE prompts risk higher scrutiny.
• Psychological Stress: Waiting months for refunds erodes trust in the system, potentially discouraging timely filings in the future.

Overall, while the backlog affects a minority, it underscores the need for proactive filing.

Government Initiatives: The NUDGE Campaign's Success

The NUDGE campaign has been a game-changer for compliance. In the last two years, it prompted 1.11 crore updated/revised ITRs, yielding additional taxes of ₹6,976.50 crore and a total revenue impact of ₹8,810.59 crore. Specific drives, like those on House Rent Allowance (HRA) claims, recovered ₹119 crore. The second NUDGE initiative in November 2025 targeted foreign assets, encouraging voluntary disclosures.

This data-driven approach has boosted collections without intrusive audits, with 60% of responders being first-time or non-filers. While it contributes to delays, it promotes transparency and fairness in taxation.

Tips to File ITR Correctly and Avoid Delays

To steer clear of the "24.6 Lakh ITRs Pending Beyond 90 Days" trap, follow these SEO-optimized tips for ITR filing:

1. Choose the Right ITR Form: Select based on income type—ITR-1 for simple salaries up to ₹50 lakh, ITR-2 for capital gains, etc. Wrong forms lead to rejections.
2. Report All Income Sources: Include salary, interest, rentals, foreign assets, and crypto gains. Cross-check with Form 26AS and AIS to avoid mismatches.
3. Claim Deductions Accurately: Verify eligibility for 80C, 80D, HRA, etc. Overclaims trigger NUDGE alerts.
4. E-Verify Promptly: Complete within 30 days to start processing.
5. File Early: Avoid last-minute rushes; aim for before July 31 for non-audit cases.
6. Update Details: Ensure PAN-Aadhaar linkage, correct bank info, and contact details.
7. Respond to Notices: Address any communications swiftly to prevent holds.
8. Use Professional Help: For complex returns, consult a CA to minimize errors.

By adhering to these, you can ensure faster processing and refunds.

Conclusion

The issue of 24.6 lakh ITRs pending beyond 90 days highlights the growing challenges in India’s evolving tax ecosystem. With increased return filings and compliance initiatives like NUDGE, scrutiny levels have risen significantly. While such delays may create financial and emotional stress for taxpayers, they also reflect the government’s ongoing efforts to curb tax evasion and strengthen revenue systems.

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