ACIT Vs Aristo Pharmaceuticals Private Limited (Supreme Court of India)
The Supreme Court addressed a batch of appeals arising from reassessment proceedings under the Income-tax Act, 1961, where various High Courts had taken divergent views on whether Jurisdictional Assessing Officers (JAOs) were competent to issue notices under Sections 148 and orders under Section 148A(d), or whether such actions were restricted to faceless authorities under the e-Assessment Scheme introduced via Notification No. 18/2022 under Section 151A. Some High Courts had quashed reassessment notices issued by JAOs on the ground that the faceless mechanism was mandatory, while others upheld the concurrent jurisdiction of JAOs.
The dispute stemmed from amendments introduced by the Finance Act, 2021, restructuring reassessment procedures to include pre-notice inquiry and hearing. Subsequently, the faceless scheme aimed to enhance transparency through automated allocation. This led to ambiguity regarding the respective roles of JAOs and faceless units.
During the pendency of these appeals, Parliament enacted the Finance Act, 2026, introducing Section 147A with retrospective effect from 01.04.2021. This provision clarified that the term “Assessing Officer” for the purposes of Sections 148 and 148A refers to an officer other than faceless assessment units. Corresponding amendments were also made in the Income Tax Act, 2025 to align definitions.
