Reopening of assessment failed where seized papers lacked a live nexus with the assessee's transaction.

Reopening of assessment under Section 148 could not rest on vague seized material without a prima facie link to the assessee. A loose paper dated years before the purchase, together with a statement from search proceedings, did not name the assessee or directly connect the material to the land transaction or alleged on-money payment. Explanation 2(iv) to Section 148 does not operate in the abstract; the revenue must still show relevant material creating a live nexus with the assessee to form a belief of escapement of income. The notice was therefore quashed.

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Issues: Whether the notice for reopening of assessment under Section 148 of the Income-tax Act, 1961 was sustainable on the basis of the seized material and statement relied upon by the revenue.

Analysis: The reopening rested on a loose paper and a statement recorded during search proceedings. The seized chit was dated several years before the petitioner's purchase, did not contain the petitioner's name, and did not by itself establish any direct nexus with the petitioner's transaction. The Court held that the expansive words used in Explanation 2(iv) to Section 148 cannot operate in the abstract; the revenue must still show a prima facie and relevant link between the material and the assessee to form a belief of escapement of income. On the facts, the material was vague, non-specific, and did not establish a live link with the petitioner's land purchase or alleged on-money payment.

Conclusion: The notice under Section 148 was not sustainable and was quashed. The writ petition succeeded in favour of the petitioner.

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