Income tax law / Refunds

Section 239 of the Income-tax Act, 1961: Refund Claims and Limitation

Section 239 prescribed how a taxpayer claimed an income-tax refund. Its wording changed substantially in 2019, and a corresponding provision now appears in section 433 of the Income-tax Act, 2025, which commenced on 1 April 2026.

Current legal position: For matters governed by the Income-tax Act, 2025, consult section 433 read with section 263. Refund entitlements and proceedings relating to earlier years may continue under the applicable saved provisions of the 1961 Act.

Meaning and purpose of Section 239

A refund arises where the tax paid or treated as paid on behalf of a person exceeds the amount legally chargeable. Section 237 of the 1961 Act addressed entitlement to a refund; section 239 dealt with the manner of claiming it. Related provisions address special claimants, refunds following appeal, interest and adjustment against outstanding tax.

Section 239 after the Finance (No. 2) Act, 2019

With effect from 1 September 2019, section 239(1) required every claim for refund under Chapter XIX to be made by furnishing a return in accordance with section 139. The same amendment omitted section 239(2), which previously contained specific limitation periods for refund applications.

Consequently, the original page's references to four-year, three-year and one-year refund-claim periods describe superseded historical wording, not the operative post-2019 version of section 239.

How refund claims and filing deadlines work

Under the 1961 Act, a taxpayer ordinarily claimed a refund through the relevant income-tax return under section 139, subject to the filing conditions applicable to that assessment year. Omission of section 239(2) did not remove deadlines elsewhere in the Act.

Depending on the year and circumstances, provisions on belated returns, revised returns, condonation of delay under section 119(2)(b), rectification and appellate relief may need examination. An updated return cannot ordinarily be used merely to claim or increase a refund. Eligibility must be checked against the law applicable to the relevant year.

Corresponding provision: Section 433 of the Income-tax Act, 2025

The Income-tax Act, 2025 came into force on 1 April 2026. Its section 433, titled Form of claim for refund and limitation, provides for refund claims by furnishing a return as per section 263. Section 263 concerns furnishing returns under the new Act. Section 431 addresses the substantive right to refund.

The transition to the new Act does not, by itself, extinguish refund rights that accrued under the 1961 Act. The Income Tax Department's transition guidance confirms that earlier refund entitlements can continue, subject to applicable procedural requirements and time limits.

Practical steps for taxpayers

Identify the correct financial year, assessment year or tax year and the law applicable to it.
Reconcile tax deducted at source, tax collected at source, advance tax and self-assessment tax with the relevant official records.
File the applicable income-tax return through the official e-filing portal within the permitted period.
Complete verification and check the refund status, bank account validation and any outstanding demand or adjustment notice.
If a deadline has passed, examine whether condonation or another statutory remedy is available rather than assuming an automatic entitlement to late filing.

Official legislation and guidance

Updated: 27 October 2026. This article provides general legal information; the governing provisions and notifications should be checked for the relevant tax year and facts.