### Reassessment notice based on vague Tax Evasion Petition without supporting material is legally unsustainable.

The petitioner, a firm, was issued a Show Cause Notice dated 23.03.2025 under Section 148A(b) for Assessment Year 2019-20 based on a Tax Evasion Petition (TEP).

The TEP alleged that the petitioner purchased gold worth ₹2,00,00,000/- using undisclosed ("black") money.

The petitioner denied the allegations and requested the respondent to supply the underlying documents, information, and statements relied upon in the TEP.

The respondent did not provide the requested material and subsequently issued an order under Section 148A(3) and a notice under Section 148 of the Income-tax Act, 1961, holding that income had escaped assessment.

Previous proceedings on the same grounds against an individual, late Shri Nanchandbhai Ranchhoddas Choksi, had been dropped/closed.

1. Whether the respondent-authority can validly initiate reassessment proceedings under Section 148 of the Act based solely on a Tax Evasion Petition (TEP) without providing the underlying material to the assessee.

2. Whether the impugned notice and order are sustainable when the allegations are vague and bereft of any supporting documentary evidence.

The court applied the statutory framework of Sections 147, 148, and 148A of the Income-tax Act, 1961, which govern the procedure for reassessment of income escaping assessment.

The court emphasized the principle of natural justice and jurisdictional requirements, holding that the Assessing Officer must possess tangible material and provide the same to the assessee to justify "reason to believe" that income has escaped assessment, rather than proceeding on vague or blunt allegations.

The Court observed that the reassessment was initiated based on "vague allegations" contained in a TEP without any corroborating components.

Despite the petitioner specifically requesting details—including names of parties, dates of purchase, nature of gold, and modes of payment—the Assessing Officer failed to provide any such material or include it in the impugned order.

The Court reasoned that the exercise of jurisdiction was "blunt" and "bereft of any material".

It further noted that roping in the firm after closing similar proceedings against an individual (late Shri Nanchandbhai) without new evidence or shared documentation constituted an invalid exercise of power.

Consequently, the Court quashed and set aside the impugned order dated 30.06.2025 passed under Section 148A(3) and the notice dated 30.06.2025 issued under Section 148 of the Act.

The petition was allowed, and Rule was made absolute.