SC to hear Centre’s plea against HC ruling on income tax reassessment

The Supreme Court will hear on Friday the government’s appeal challenging a Punjab and Haryana High Court judgment that struck down the newly inserted Section 147A of the Income Tax Act, 1961.

The dispute centres on whether reassessment notices issued through the conventional system by Jurisdictional Assessing Officers (JAOs) remain valid after the process was mandated to be technology-driven and faceless, with cases allocated to officers through an automated system.

Lakhs of individuals and companies have challenged reassessment proceedings initiated by JAOs instead of faceless assessing officers (FAOs), with such cases playing out before various high courts since 2023.


Section 147A, inserted through the Finance Act 2026, retrospectively clarifies the role of the JAO in reassessment proceedings. It states that under Sections 148 and 148A, an “Assessing Officer”, meaning a jurisdictional officer, would be the authority to issue reassessment notices instead of the faceless assessment system.

The Punjab and Haryana High Court has held that Section 147A is ultra vires, making Friday’s Supreme Court hearing significant for the ongoing dispute over the validity of such reassessment notices.

The Supreme Court had in April 2026 set aside earlier high court rulings and left the validity and retrospectivity of Section 147A open for high courts to decide. It had asked the high courts to reconsider the remanded matters, preferably by September 30, 2026.