Supported share transactions and long-term capital gains cannot be rejected on suspicion without specific material linking the assessee to sham dealings.

Supported share transactions evidenced by demat records, banking channels and contract-linked dealings cannot be treated as unexplained income or bogus accommodation entries merely because of an alleged penny-stock pattern, abnormal price movement, or a general investigation report. The text states that, where the holding period supports long-term capital gain and the Revenue does not produce independent inquiry or specific material linking the assessee to price manipulation, exit providers, or sham dealings, the assessee's evidence prevails. On that basis, the additions under section 68 and the related commission disallowance under section 69C were deleted.

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Issues: Whether the addition made by treating the long-term capital gains from sale of shares as unexplained income and the consequential commission disallowance were sustainable.

Analysis: The sale and purchase of shares were supported by documentary evidence, including demat entries, banking channels, and contract-linked transactions, and the holding period satisfied the character of long-term capital gain. The addition was founded mainly on a general investigation report and an alleged penny-stock modus operandi, without any independent inquiry linking the assessee to price manipulation, exit providers, or other direct adverse material. Mere abnormal price rise, suspicion, or borrowed findings could not displace the assessee's evidence in the absence of cogent material controverting the genuineness of the transaction.

Conclusion: The addition under section 68 and the consequential disallowance under section 69C were deleted, in favour of the assessee.

Ratio Decidendi: A supported share transaction cannot be treated as bogus accommodation income merely on the basis of suspicion or a general investigation report unless the Revenue brings specific, cogent material and independent inquiry linking the assessee to manipulation or sham dealings.

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