The Government of India today apprised the Hon’ble Supreme Court that the process of introducing further amendments to Section 150 of the Income Tax Act is underway. The proposed amended provisions are slated to come into effect from April 1, 2026.
During the course of hearing, the learned Additional Solicitor General (ASG), appearing for the Union of India, submitted that the forthcoming amendment will have a significant bearing on a large number of pending assessment and reassessment proceedings across the country.
As per submissions made before the Court, following the judgment in the Ashish Aggarwal matter, nearly 2,000 cases are pending before the Hon’ble Supreme Court and approximately 18,000 cases are pending before various High Courts. The Income Tax Department has informed that reassessment proceedings involving an amount exceeding ₹16.5 lakh crore are presently stalled. The Department emphasized that such a substantial amount is of considerable importance to the national economy and that assessment and litigation processes cannot remain pending indefinitely.
Observations of the Hon’ble Court
The Hon’ble Chief Justice of India observed that the proposed amendment may be clarificatory in nature and could address issues relating to the validity of the faceless reassessment mechanism. It was further indicated that once the amended law comes into force, its constitutional validity may be subject to challenge, and in such an eventuality, the Court may consider granting a three-month moratorium to enable affected parties to seek appropriate legal remedies.
Hon’ble Justice J.B. Nagarathna observed that if Parliament enacts an amendment affecting the existing legal position, the Court would examine its impact and assess whether it alters the basis of prior judicial decisions.
The Court also clarified that no litigant can be compelled to approach either the High Court or the Supreme Court; the choice of forum remains with the concerned party. However, it was observed that if matters are first adjudicated by the High Courts, the Supreme Court would benefit from their considered views.
Submissions by the Government and Petitioners
The ASG submitted that upon enactment of the amendment, all previously issued notices and assessment proceedings would stand revived, and appropriate timelines would be prescribed for passing orders. It was further contended that repeated filing of petitions has resulted in prolonged delays in the assessment process.
On the other hand, the petitioners submitted that nearly five years have already elapsed and raised concerns regarding the forum and manner in which issues relating to the validity, legislative intent, and potential conflict with the faceless reassessment mechanism would be adjudicated. In response, the Hon’ble Chief Justice observed that the validity of a law can be examined only after it comes into force.
Next Date of Hearing
The Hon’ble Supreme Court has adjourned the matter to April 6, 2026. The impact of the proposed amendment, effective from April 1, 2026, on pending cases and the faceless reassessment framework will be closely watched.
