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  5. After lower income-tax refund, AI agent says file rectification but CA says wait. What is best?

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After lower income-tax refund, AI agent says file rectification but CA says wait. What is best?

balwant jain
By Balwant Jain

5 min read | Updated on February 22, 2026, 15:40 IST

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SUMMARY

Logically, the Income Tax Department's system should process the latest ITR filed, ignoring all the earlier ITRs. But it seems that the system is not so robust and does process earlier ITRs also without actually processing the latest ITR.

income tax suggestion by ai vs ca

A taxpayer can file an application for rectification within four years from the date of receipt of the intimation. | Image source: Shutterstock

Many taxpayers have recently reported receiving delayed income-tax refunds for FY 2024-25 (AY 2025-26). Some of them, however, are not happy with the refund amount as they had expected a higher payout. As a result, several taxpayers are now wondering about the next steps, mulling whether to file a rectification application. Some are even seeking guidance from AI agents or CAs. But getting the right answer to tax queries can be challenging. Today's Q&A explains what is the best thing to do in such a situation.
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Question: I had filed my original Income Tax Return (ITR) on 30 July 2025. Later on, I received a message from the Income Tax Department on 20 December pointing out some omissions. So I filed a revised ITR on 26 December, 2025. I filed one more revised ITR yet again on 30 December 2025, as my CA had not taken my correct HRA number in the revised ITR filed on 26 December, 2025.
All three ITRs were electronically verified immediately. Now the Income Tax Department has processed my return filed on 26 December, 2025, and issued the refund accordingly. As per the revised ITR filed on 30 December, 2025, I am entitled to a higher refund.
An Artificial Intelligence (AI) agent advises me to file a rectification request under Section 154 within 30 days, requesting the Income Tax Department to process my ITR filed on 30 December 2025, but my CA insists that there is no need to file such a request under Section 154 because the Income Tax Department is duty-bound to automatically process my return dated 30 December 2025.
Kindly advise if I should file the rectification application under section 154 or wait for the Income Tax Department to process it automatically?

As per the provisions of income tax laws, a person who has filed an ITR, whether by the due date or a belated one, can revise the ITR filed by him anytime and any number of times by 31 December of the assessment year.

The revised ITR can be filed to correct any omission or error. This may result into increase or reduction in tax liability or an increase or reduction in the income tax refund.

So the law allows you to revise your ITR any number of times by 31 December 2025. Since you have filed both the revised ITRs well in time, both revised ITRs are validly filed.

As per the law, a validly filed revised ITR is supposed to replace any ITR filed earlier, including a revised one. The revised version of the ITR becomes the final and operative return for that assessment year.

So logically, the Income Tax Department's system should process the latest ITR filed, ignoring all the earlier ITRs. But it seems that the system is not so robust and does process earlier ITRs also without actually processing the latest ITR.

A taxpayer can file an application for rectification of mistake under section 154, with the request to rectify the mistake pointed out, within four years from the date of receipt of the intimation, and not 30 days as mentioned by you.

The period of 30 days applies to appealing against any order passed by the assessing officer.

Since the system is not so robustly configured, it may or may not eventually process the latest ITR filed by you on 30 December 2025. Therefore, it is advisable for you to file an application for rectification of the mistake apparent on record, instead of waiting for the latest revised ITR to be processed.

Key points to know
TopicSummary
ITR revision windowYou can revise your ITR any number of times until 31 December of the assessment year.
Effect of revised ITRThe latest revised ITR automatically replaces all earlier returns.
How the system should workThe Income Tax Department system should process the latest revised ITR.
What happens in realityThe system sometimes processes an older ITR instead of the latest one.
Refund implicationsA refund may be issued based on an older ITR if the system doesn’t pick the latest return.
Rectification timelineSection 154 rectification can be filed within four years of receiving the intimation.
Recommended actionFile a Section 154 rectification request instead of waiting for automatic processing.
Have a personal finance and income tax query? We will try to get them answered by experts. Write to rajeev.kumar@rksv.in
Disclaimer: The views and opinions expressed above are those of respective experts/commentators and do not reflect the views of Upstox. The above Q&A is only for informational purposes and should not be considered investment or tax advice from Upstox. Please consult a tax expert for your complex tax problems.

About The Author

balwant jain
Balwant Jain is a Mumbai-based tax and investment expert.

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