Income Tax Refund Guide: Status Tracking, Section 244A Interest & Reissue

आयकर रिफंड ट्रैकिंग एवं ब्याज नियम

Comprehensive guide to Income Tax Refunds in India: how refunds arise when TDS/advance tax exceeds actual tax liability, Section 244A statutory interest (0.5% per month), tracking on the e-filing and TIN-NSDL portals, and submitting Refund Reissue requests for failed credits.

Written by: Author Profile

Direct Tax & CA Review Panel

Chartered Accountancy Review Panel • Senior Direct Tax Review Desk

Reviewed & Fact-Checked by: Technical Review Panel

Tax Law & Dispute Review Desk

Tax Litigation & Legal Review Panel • Tax Appeal & Procedure Review Desk

Published: 1st April 2026•Last Updated: 15th August 2026•Last Reviewed: 15th August 2026

Key Statutory Highlights (FY 2026-27 (AY 2027-28))

A tax refund arises under Section 237 when tax paid (TDS, TCS, Advance Tax) is greater than total assessed tax liability.

Section 244A Interest: The Income Tax Department pays simple interest @ 0.5% per month (6% p.a.) on the refund amount calculated from 1st April of the Assessment Year until the date of grant of refund.

Direct Credit via NECS/RTGS: Refunds are directly credited to pre-validated and EVC-enabled bank accounts (no physical paper cheques).

Refund Reissue: If a refund fails due to incorrect bank account details or IFSC code, submit a 'Refund Reissue Request' on the e-filing portal.

Outstanding Demand Adjustment: Under Section 245, the department can adjust pending tax demands from previous years against current year refunds with prior intimation.

Who is Eligible & When Does it Apply?

Applicability #1

Taxpayers whose total tax credits exceed their final assessed tax liability in Form 143(1).

Step-by-Step Procedure & Compliance Roadmap

Pre-Validate Bank Account on Portal

Go to Profile -> My Bank Accounts. Ensure Name on PAN matches Bank Name exactly, IFSC is correct, and account is EVC-enabled.

File & E-Verify ITR

Claim refund amount in ITR Part B-TTI and submit with e-verification.

Track Processing Status on e-filing / TIN Portal

Visit Services -> Know Your Refund Status or TIN-NSDL refund tracking page using PAN and AY.

Submit Refund Reissue (If Failed)

If status shows 'Refund Failed', select Services -> Refund Reissue, choose correct bank account, and verify with Aadhaar OTP.

Mandatory Documents Checklist

PAN Card, Bank Account Number & IFSC, Section 143(1) Intimation order

Common Mistakes & Compliance Risks to Avoid

•Providing unvalidated bank account details or joint account where primary holder name mismatches PAN.

•Not replying to Section 245 demand adjustment intimations.

Frequently Asked Questions

Is interest received on income tax refund taxable?

Yes. While the refund principal itself is not taxable, the interest amount received under Section 244A is taxable under 'Income from Other Sources' in the year of receipt.

Interactive Tax Calculators

Income Tax Calculator

Related Tax Knowledge

ITR Status Tracking Step-by-Step ITR Filing

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🛡️ Educational Disclaimer: FinSetu India is an independent educational guidance and calculation platform. Content is published for general citizen awareness based on applicable laws as of FY 2026-27 (AY 2027-28). We do not provide personalized legal/tax advice or file returns directly. Verify current applicable rules on official portals or consult a qualified Chartered Accountant / Tax Lawyer.