Pending GST refund claims over 90 days have fallen to just 110 cases worth ₹64 crore, according to recent government data. This reduction marks a major improvement for businesses relying on timely tax rebates. Improved automation and better document compliance are the primary reasons for this increased speed in processing.
The government has reported a substantial reduction in the backlog of Goods and Services Tax (GST) refund claims. According to data provided to Parliament, the number of pending claims that have exceeded the standard 90-day processing window dropped to 110 cases, involving a total value of ₹64 crore as of March 31, 2026. This represents a significant decline compared to the 712 claims worth ₹560 crore that remained unresolved at the end of the previous fiscal year.
Efficiency Gains in Tax Administration
The improvement in processing speed is largely driven by the adoption of automated systems that reduce the need for manual oversight. For export-related refunds where Integrated GST (IGST) has been paid, the process is now fully handled through a direct link between the GST portal and the ICEGATE platform managed by the Central Board of Indirect Taxes and Customs. This automation allows for a smoother flow of data and faster verification. Furthermore, for zero-rated supplies, the tax department now provides a provisional refund of up to 90% of the claimed amount within seven days of acknowledging the application, which helps companies maintain their operational cash flow.
Why Refunds Were Delayed
While the current data shows a clear downward trend in pendency, historical data highlights that delays have been a persistent challenge for many businesses. In fiscal year 2024, for instance, there were 1,592 claims pending beyond 90 days, valued at ₹696 crore. The government has identified several reasons for these delays, which are important for businesses to track. The most common issues include delays by taxpayers in submitting necessary documentation, failure to respond to official notices in a timely manner, and requests from taxpayers to hold their applications while they gather additional proof. In some cases, technical glitches within the reporting systems have also contributed to processing hold-ups.
What This Means for Business Cash Flow
For companies engaged in exports or those dealing with inverted duty structures where input tax is higher than output tax, GST refunds are a crucial component of working capital management. Efficient processing means less cash is trapped with the government, allowing businesses to reinvest that capital into their operations. Taxpayers can now monitor the real-time status of their applications on the GST common portal. In instances where a claim is rejected, the tax authorities are required to provide a formal speaking order under the Central GST Act, 2017, which explains the specific reasons for the rejection, providing greater transparency for businesses to address potential compliance gaps.