Section 147A of the Income-tax Act Struck Down: Punjab and Haryana High Court Ruling on Reassessment Notices

The Punjab & Haryana High Court held that Section 147A of the Income-tax Act, introduced retrospectively through the Finance Bill, 2026 with effect from April 1, 2021, is unconstitutional and struck it down. The provision sought to validate the issuance of reassessment notices by jurisdictional Assessing Officers notwithstanding the faceless assessment framework under Section 151A. 

The Court held that Section 147A failed to remove the legal basis of earlier constitutional court decisions requiring notices under Section 148 to be issued through randomized and automated allocation in a faceless manner. Section 151A and the scheme dated March 29, 2022 continued to remain in force without amendment, including the requirement of automated allocation. The Court also noted that Section 147A did not refer to Section 130 or the scheme dated March 28, 2022, which had also formed part of the basis for the earlier judicial findings. 

The Court reaffirmed that the legislature cannot directly overrule or annul a judicial decision; it may only remove the statutory foundation on which the decision rests. Since Section 147A did not do so, notices issued by jurisdictional Assessing Officers without following the faceless mechanism were quashed. 

The ruling therefore reinforces the separation of powers and the statutory requirement of faceless, randomized allocation in reassessment proceedings. 

Source update: Jyoti Sareen v. Union of India 

Last Updated on 9 October, 2026