What was connoted in the context where, at Grdhrakuta, the Buddha held up a flower to a responsive smile?

According to Da Fan-tian Wang wen Fo jue-yi jing (Sutra on

Mahabrahma Devaraja Asking the Buddha to Resolve Doubt), the king

of the eighteen Brahmalokas was at Grdhrakuta (hereafter Spirit Vulture

Peak) to offer to the Buddha a golden garland, asking him to open

up the treasury of truth and teach the Dharma. As it happened, the

Buddha held up a flower, which he showed before the congregation.

No one seemed able to read his intent. All but Mahakasyapa the

Honored One assimilated in mind and, brimming with Dharma joy,

broke into a responsive smile. At that, the Buddha said,

‘Herewith the treasury of right dharma-eye, the wondrous mind of

nirvana, which I shall entrust to you.’

Mahakasyapa thus in reception and attainment, the Chan school

was launched:

‘No transmission beyond the school,

No scripture ever be established;

Directed straight be at the human mind,

Buddhahood on seeing the Buddha-nature.’

Such is the method of Dharma transmission from heart to heart

between teacher and disciple. Mahakasyapa became the first patriarch

of the Chan school and, with eastern transmission of the Dharma later,

Bodhidharma, the first patriarch of the Chan school in China. More

references are found in Liu Zu tan jing (hereafter Alter Sutra of the

Sixth Patriarch).