New Delhi: The Supreme Court has stayed the Punjab and Haryana High Court’s ruling that struck down Section 147A of the Income Tax Act as unconstitutional. A Bench comprising Justice J.B. Pardiwala and Justice K. Vinod Chandran issued the interim stay order while hearing the Union government’s petition challenging the judgment passed earlier this month, posting the matter for final disposal on December 3, 2026.
Under the interim directive, the Supreme Court stipulated that while the High Court’s decision remains stayed, tax authorities cannot advance the pending reassessment proceedings until the apex court reaches a final verdict. The Centre’s Special Leave Petition had been mentioned earlier for urgent listing before Chief Justice of India Surya Kant by Additional Solicitor General N. Venkataraman.
The underlying legal dispute stems from the Punjab and Haryana High Court’s decision to invalidate Section 147A across nearly 700 petitions. The High Court had ruled that Parliament could not retrospectively declare a legally flawed procedure valid without curing the underlying procedural defects. Consequently, it set aside notices and reassessment proceedings initiated by Jurisdictional Assessing Officers outside the statutory faceless assessment framework.
Section 147A was introduced with retrospective effect from April 1, 2021, to clarify that reassessment notices under Sections 148 and 148A could be issued by Jurisdictional Assessing Officers alongside the National Faceless Assessment Centre. While the Punjab and Haryana High Court held that such reassessment notices had to be routed through automated, faceless allocation under Section 151A, divergent views from other high courts prompted the Union government to seek an authoritative resolution from the top court.
