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CS Executive · Tax Laws and Practice · Procedural Compliance under Income Tax

Under the Income-tax Act, 2025 (applicable from the June 2027 session), a person is entitled to a refund of tax for a tax year when, in the Assessing Officer's satisfaction:

A person gets a refund when the tax paid by or on his behalf, or treated as paid, for the tax year exceeds the amount properly chargeable under the Act. The refund equals the excess, and the Assessing Officer must be satisfied of this.

  1. Athe tax paid by or on behalf of the person, or treated as paid, exceeds the amount with which the person is properly chargeable for that yearCorrect
  2. Bthe person has filed the return of income on or before the due date, irrespective of the tax paid
  3. Cthe advance tax paid is more than the tax paid in the preceding tax year
  4. Dthe person has no demand outstanding for any earlier tax year

Explanation

Section 431 entitles a person to a refund of the excess where tax paid by him or on his behalf, or treated as paid, exceeds the amount with which he is properly chargeable for that year. Timely filing, comparison with the previous year's tax or absence of earlier demand is not the statutory test; a demand would in fact allow set off.

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