Assessing officers cannot initiate reassessment proceedings under the taxation law based on vague, unconnected, or generic information retrieved from third-party search operations. A "live link" demonstrating a reasonable, prima facie connection between the seized material and the assessee's specific income is an essential prerequisite for a valid notice.

JUDGMENT :

A.S. SUPEHIA, J.

1. RULE returnable forthwith. Learned Senior Standing Counsel Mr.Bhatt waives service of notice of rule for respondent.

2. In the present petition, the petitioner has assailed the notice dated 31.03.2025 issued by the respondent under section 148 of the Income Tax Act, 1961 (for short ‘the Act’) for the Assessment Year (AY) 2019-2020.

BRIEF FACTS:

3. The petitioner had not filed her return of income for AY 2019-20 as her taxable income did not exceed basic exemption limit. An information was received that search action under Section 132 of the Act was conducted in the case of B Safal Group, City Estate Group, City Estate Management India and City Procon Realtors Pvt. Ltd. and several incriminating documents were found and seized. On the basis of the said information, the respondent issued notice under Section 148 of the Act dated 31.03.2025, after taking approval from the Chief Commissioner of Income Tax, Ahmedabad-1. The petitioner filed detailed objection along with the supporting documents through letter dated 27.06.2025 (filed physically on 08.07.2025 and through mail on 28.06.2025).

SUBMISSIONS ON BEHALF OF PETITIONER:

4. Learned advocate Mr.Vora has submitted that the petitioner, who has sold her land on 03.04.2018 is sought to be roped in the reassessment proceedings on an entry made in a loose paper in the inquiry Registered on 04.11.2017, which is much prior and hence, the petitioner cannot be held responsible by alleging that she has received some on–money by cash. It is thus, submitted that the entire reopening is premised on an incorrect fact and there is no live link to the alleged rates mentioned in the inquiry Register on a loose paper directly linking the petitioner.

5. learned advocate Mr.Vora has submitted that the said information, which has been derived by the Assessing Officer (AO) from the hand written extract of the inquiry register, is neither authorized nor signed by the assessee and it does not contain any name or signature of the petitioner, co-sellers or purchasers. It is further submitted that the information was further shown to one Shri Pravin Nagjibhai Bavadiya, the searched person, who has also not referred the actual name of the petitioner and also the status of the land in question. It is therefore, submitted that the extract of the inquiry registers, which is found from the premises of entirely unrelated party/entities with whom the petitioner has no business or any personal association, cannot form a valid basis for drawing any adverse inference against the petitioner in absence of any direct or indirect link.

6. Learned advocate Mr.Vora has further submitted that from the basis of the extract of the inquiry register, the satisfaction note was recorded by the AO to the extent that B Safal Group has accepted on-money over and above the documented price as per the sale deed which is merely, on presumption, roping in the petitioner who had sold the land vide sale deed dated 03.04.2018.

7. It is further submitted by learned advocate Mr.Vora that the land actually sold by the petitioner and others on 03.04.2018 having Survey No.1374/2 situated at Ognaj admeasuring 2,114 square meters i.e. 2,528 square yards, whereas, the loose paper relied upon mentions a figure of '4200 S.Y.' i.e. 4200 square yards. He has submitted that these discrepancies, coupled with the absence of any corroborative evidence or direct linkage to the petitioner, render the reliance on such material wholly unjustified and insufficient to initiate reassessment proceedings for the purpose of inquiry or verification. Thus, it is submitted that the assessment is sought to be reopened on the basis of conjunctures and surmises and hence, the impugned notice may be quashed and set aside.

SUBMISSIONS ON BEHALF OF RESPONDENT :

8. Vehemently opposing the submissions advanced by learned advocate Mr.Vora, learned Senior Standing Counsel Mr.Bh