Adding bank account for the deceased for ITR refund

Remove the failed bank account from your profile, ensure your personal bank details are fully updated and linked to your PAN, re-add the account, and remember to select "Nominate for Refund" after validation is successful.

Tried that, but it didn't work.

When I remove the bank account from my account, it does not get removed from the deceased's dashboard. Hence, even after adding the bank account in my login and validating & nominating for refund, the same bank account remains under "Failed Bank Account" in the deceased's dashboard (after logging in as Legal heir).

This is not a compliance issue, it seems like a portal issue as you are already approved as a Legal Heir. In most cases, the refund due to the late assessee will be credited to the legal heir's bank account with proper linking and validation of the bank account on the e-filing portal.

As a practical move, go ahead and raise a grievance on Refund/Bank Account and ask for CPC to allow bank account verification for the legal heir. Contact the bank to revalidate or remove and re-add the account, if available, if the account appears in the “Failed Bank Accounts” section of the account. 

 If you still cannot add a bank account with the portal, it may be worth filing a return, and then request a refund once processed; many taxpayers that have had similar legal-heir problems have reported a problem with the portal.

 If the amount of the refund is significant, it might be worth to escalate the issue to the jurisdiction Assessing Officer or to get help from a CA with some experience in the deceased assessee cases.

Finally got the solution:

1. Login on ITR portal and switch to Legal Heir dashboard.
2. Download the json for pre-filled data (e-file --> Income Tax Returns --> Download Pre-Filled Data) for the deceased
3. Open a new tab and go to the income tax portal. Don't login. Just download the Common Utility for ITR1, ITR2, ITR3 and ITR4
4. Enter the PAN of the deceased in the utility and upload the JSON. There's no password to be entered
5. Enter all the information for filing the ITR
6. Download the JSON after 1st level of validation (Do not proceed for verification on the downloaded Utility)
7. Go to ITR portal, login and switch to Legal Heir dashboard
8. Select the "Offline" option to file the return
9. On the next page, upload the JSON downloaded from the Common Utility
10. Proceed for validation and verification
11. Done

I got an error that the email id and contact number of the Tax Payer and Representative Assessee are same. They need to be different.
Changed the information again on the Utility, got the JSON again, uploaded on ITR portal and things sailed through.