Reopening of assessment based on unrelated, dated loose papers without establishing a live link is impermissible.

The petitioner challenge a notice issued under Section 148 dated 31.03.2025 and subsequent notices under Section 142(1) of the Income Tax Act, 1961

Following a search and seizure operation on Bsafal Group and City Estate Group in September 2021, the Revenue recovered a loose paper chit dated 11.08.2017 mentioning Survey No. 101 at Moje Shela with a rate of Rs. 17,000/- per sq. yard

The Assessing Officer (AO) linked this to the petitioner’s sale of land on 12.10.2021 (four years later) and concluded that "on-money" was paid in cash based on the price differential

The petitioner contended there was no nexus between the 2017 document and the 2021 transaction

1. Whether the Revenue established a "live link" or nexus between the seized incriminating material and the petitioner to justify reopening the assessment under Section 148

2. Whether the phrases "pertains to" or "relates to" under Section 148 can be invoked based on vague, non-specific information without evidence of actual connection to the assessee

The court applied Section 148 of the Income Tax Act, specifically Clause (iv) to Explanation 2, regarding information that "pertains to" or "relates to" the assessee

It considered the precedent in Raymond Woollen Mills Limited v. ITO, holding that while the Revenue only needs prima facie material to reopen, the material must be relevant

It further referenced ACIT v. Rajesh Jhaveri Stock Brokers (P.) Ltd. regarding the requirement of a reasonable person forming a requisite belief

Naliniben Jagdishkumar Gandhi v. ITO

The court found that the Revenue failed to establish a "live link" between the seized material and the petitioner. The chit relied upon was dated 11.08.2017, whereas the petitioner’s transaction occurred on 12.10.2021—a gap of four years

The statement of the broker (Shri Bavadiya) did not mention the petitioner’s name, and there was no evidence linking the petitioner to the Bsafal or City Estate groups

The court noted that the AO’s calculation of "on-money" was based on arbitrary rates from an old document imposed onto a subsequent registered sale deed

While the law uses expansive terms like "relates to," these cannot be applied in a vacuum; the Revenue must record a prima facie opinion linking the material to the actual escapement of income

Reopening based on vague and non-specific information is legally unsustainable

It held that the Revenue cannot reopen an assessment where the information is vague, irrelevant, and lacks a remote link to the assessee

Rule was made absolute