Challan status in Payment Failed but amount deducted from bank

It has been over a week now

@ Niraj

It is not clear from your statement how you filed ITR, if any tax payment was outstanding [ because you are saying you get the message "Payment Failed"]

I think, you log in to IT Filing Portal, go to Epay and check lists of successful payments and failed payments - to reconfirm what actually happened.

Hello sir , yes did self assessment completed everything- did the payment- payment debited from bank(received the confirmation of same and verified with bank as well). 

Now under epay- generated challan - status is payment failed. 

Challan is also generated with CRN and other IDs 

So I cannot proceed further for verification. After last section I still get the the pay now button.

I also checked the latest AIS and it shows my current tax payment. 

Not sure why the challan still reflects as payment failed.

Thanks for help

@ Niraj

If you got the Challan [ it is receipt for payment made ] showing BSR Code, Date Of Payment, Challan Number and Amount paid, then it means that the payment is successful.

If "Payment Failed" then there would not be any Challan [Payment receipt].

Regarding payment showing in 26AS, due to the WISDOM of Income Tax Department, any Advance Tax and Self Assessment Tax has stopped showing in 26AS for last 3 years - now it shows in AIS ; does not show in TIS. And for any Self Assessment Tax paid in FY 2026-27 [ not AY 2026-27], the AIS for FY 2026-27 will show it. So check your AIS for the current FY, not for the last FY.

@ Ranjan sir, 

I proceeded with the verification. it got completed and after that i received demand notice . Question is if my payment is successful and challan generated then why am I getting demand notice. 

Also when I checked the filed returns the status is showing 'Processed with demand due' where as last year filing status was 'Processed with no demand'

@ Niraj

You give a reply ONLINE to the demand notice providing all details of Self Assessment Tax Payment [BSR Code, Challan Number, Date of Payment and Amount] and request IT Department / CPC to correct their system mistake and change your filed ITR status as fully compliant and complete.

@ Ranjan sir, whom do I reply online.

This mail is system generated.

Is there any contact available online..?

@ Niraj

To reply to an Income Tax Dept Notice or Demand, log into the e-Filing Portal, go to Pending Actions tab, and select e-Proceedings or Response to Outstanding Demand. 

Upload your supporting document [ which is the Challan in your case], and submit your request for I T Dept / CPC to correct their mistake.

Then keep your fingers crossed, wait for a few weeks, maybe, for their response. They are very very very busy handling crores of tax payers and expected to take bit of time to deal with your response.

I have seen their replies coming after 2 years. So keep all your documents carefully for a few years, I T Dept suggests keeping documents for at least 7 [SEVEN] years.

BEST OF LUCK

Ok, I will follow the above steps. 

Should I do a revised filing after that..?

Will I have to pay again.?

Thanks you so for helping me.

@ Niraj

One more suggestion from me.

If the Self Assessment Tax [ which is the matter in dispute] is not huge, then make another payment against the demand so as to complete the ITR for this AY.

And wait for response to your reply, if the IT Dept accepts their mistake then you may get back the disputed amount as refund / adjustment in future.

@ Niraj

There is no need for any revised filing, since your ITR is supposedly ok, except for the credit of the paid Self Assessment tax, for which you already got a demand notice.

This UPI challan glitch is unfortunately common on the income tax portal. The payment went through (your bank statement confirms the debit) but the portal failed to acknowledge the CRN (Challan Reference Number). Here is what to do to resolve the demand notice.

Step 1 , Locate the CRN. If a CRN was generated before the payment error, note it down. You can also check in the e-filing portal under e-Pay Tax, then Payment History , the CRN should appear even if status shows Failed. Alternatively, check your UPI app transaction reference ID.

Step 2 , File a grievance to link the payment. Go to e-Nivaran on the portal. Select Grievance Category "Challan" and sub-category "Challan not reflecting / CIN not updated." Attach: bank statement showing debit, the UPI transaction reference, and the CRN if available. The CPC will manually verify and credit the payment.

Step 3 , Separately, respond to the demand notice. The notice would have come under Section 143(1). Reply using the e-proceedings tab, select "Agree in part" or "Disagree," and explain that the tax was paid but the challan is pending reconciliation. Attach the same bank evidence. This puts the demand in dispute while the payment is being linked.

Step 4 , If the amount was deducted twice (once showing failed, once actually successful duplicate), raise a refund claim through the bank 

Most of these UPI portal glitches are resolved within 7 to 10 working days once the grievance is filed with the transaction evidence. Do not wait , the demand starts accruing interest under Section 220(2) at 1% per month from the date of the notice.

@ Tax Garden

Much appreciated your help.

Let Niraj try the steps and see if his problem gets resolved.

This generally occurs due to payment reconciliation issues. First, check the challan status after 24-72 hours. If the challan is still not generated, submit a grievance on the Income Tax e-filing portal along with the payment confirmation. If the payment is not reconciled, the amount is typically refunded automatically. Once the refund is received, you can make the payment again.