ITR refund still not received? The 8 real reasons refunds stall in AY 2026-27 — and how to fix each one

The most frequently asked question right now is simple: "I filed my return — when will the refund come?"

More than 5.9 crore ITRs had been filed for AY 2026-27 by 31 July. The refund queue is long. But what practice shows is that in most cases the department is not slow. The return is stuck at one specific gate, and that gate is usually one you can open yourself in ten minutes.

This article puts those eight gates in order, from most common to least.

# First: when does the clock start

This is the most important point, and the one most often missed.

Refund processing does not start when you file. It starts when you e-verify.

The Income Tax Department's own guidance is that refunds are generally credited in four to five weeks — after e-verification. If you filed on 20 July and have still not e-verified, your refund is not in the queue at all. Zero days of progress have been made.

And one clarification worth giving every client: four to five weeks is a service expectation, not a legal entitlement. The statutory outer limit is different — processing under Section 143(1) can take up to nine months from the end of the financial year in which the return was furnished.

# Gate 1 — The return was never e-verified

The most common, and the easiest to fix.

Check: e-filing portal → e-File → Income Tax Returns → View Filed Returns. The status should read "Successfully e-Verified".

Fix: Aadhaar OTP is fastest — two minutes. Net banking, bank account EVC or demat account EVC also work. Posting a physical ITR-V to CPC Bengaluru is the slowest option; avoid it.

# Gate 2 — The bank account is not pre-validated

Refunds are credited only to a pre-validated bank account. That is not the same as having merely "added" a bank account.

Check: Profile → My Bank Account. The status should show "Validated" and "EVC Enabled", and the account should be nominated for refund.

Fix: Validate it. If validation is failing, look at the next few gates — the cause is usually the name or the IFSC.

# Gate 3 — The IFSC has changed

This silently fails more refunds than anything else. After bank mergers, old IFSC codes are retired, but the old account details sit unchanged on the portal.

Fix: Confirm the current IFSC with your bank, update the account details on the portal, and pre-validate again.

# Gate 4 — The bank account name does not match the PAN

The department matches names. If your bank records show "Rajesh Kumar Sharma" and the PAN says "Rajesh K Sharma", validation can fail.

Fix: Visit the bank branch and have the name updated to match the PAN format exactly. This is the slowest fix of the lot, so start it first.

# Gate 5 — The PAN is inoperative

If PAN is not linked to Aadhaar it becomes inoperative, and refunds are not issued against an inoperative PAN. This appears on the department's official list of refund failure reasons.

Fix: Link PAN and Aadhaar, wait for the PAN to become operative, then raise a refund reissue request.

# Gate 6 — The refund was adjusted against an old demand

Under Section 245 the department can adjust your refund against an outstanding demand from an earlier year.

Check: The status will show "Fully Adjusted" or "Partially Adjusted". Details are under Pending Actions → Response to Outstanding Demand.

Fix: If the demand is incorrect, disagree on the portal with reasons. If it is correct, the adjustment stands and the refund will simply be lower.

# Gate 7 — TDS or AIS mismatch

If the TDS you claimed is not fully reflected in Form 168 (previously Form 26AS), the department will adjust the claim during processing itself.

This is often not your error — the deductor may have filed their TDS return late, or entered the wrong PAN.

Similarly, an AIS mismatch can flag the return for extended review. The most common ones:

• savings or FD interest that appears in AIS but was not declared in the return
• mutual fund or share sales reported in AIS
• dividend income

Fix: Reconcile AIS and Form 168 again. If an AIS entry is wrong, submit feedback on the portal. If there is a genuine omission, a revised return is the better route — for AY 2026-27 you can revise until 31 March 2027, but a Section 234-I fee applies after 31 December 2026 (₹1,000 if income is up to ₹5 lakh, otherwise ₹5,000).

# Gate 8 — "Refund Failed" status

This means processing is complete and the refund was approved, but the transfer failed.

Fix: Correct the bank details (Gates 2 to 4), then Services → Refund Reissue → raise a fresh request. This is a manual step — it will not retry on its own.

# The Section 143(1) intimation — read it, do not delete it

When the return is processed, an intimation under Section 143(1) reaches your registered email. Most people ignore it.

That intimation contains a line-by-line comparison of what you declared against what the department computed. If the refund is lower than claimed, the reason is in that document.

# Interest on refunds

Delayed refunds carry interest under Section 244A. Two things to remember:

1. It is not paid in every case; the computation depends on timing.
2. This interest is taxable — it must be declared next year under income from other sources. This is a very common omission, and it later becomes an AIS mismatch of its own.

# Which gate is yours

Written by

Prabhakar Kumar

Chartered Accountant (ICAI, Nov 2019)

Chartered Accountant (FCA, ICAI) and founder of VittSphere Technologies. Writes on Indian taxation, capital gains, GST and personal finance.