Error code-(3)"The referenced transaction does not meet the criteria for issuing a credit"

Summary

This issue/error is usually observed when a transaction (Charge) is not fully processed or settled. Settlements usually happen on within 24 hours,

In this particular scenario, you will need to wait for the transaction to settle and then initiate the refund from Chargebee.

This error is applicable to the Authorize.net gateway.

Solution

Retry the refund after 24hours, once the transaction (Charge) has settled.

Ensure to initiate the refund from Chargebee so that it's logged against the invoice, processing a refund form the gateway will not be registered in Chargebee and will need to be recorded manually.