Section 68 addition needs corroborative proof; Investigation Wing information alone and suspicion could not sustain the entry-based disallowance.

Addition under section 68 could not be sustained on Investigation Wing information alone where no independent enquiry, bank verification, or corroborative material linked the assessee to the alleged accommodation entries. The factual finding was that the Revenue had only departmental information from searches on third parties and the assessee's non-compliance, while the assessee denied the transactions and the Revenue produced no material to rebut that denial. In the absence of transaction-specific proof and a direct nexus with the entry providers, the claim remained suspicion, which was insufficient to justify the addition. Deletion of the addition was therefore upheld.

---

---

Issues: Whether the addition under section 68 of the Income-tax Act, 1961 could be sustained solely on information from the Investigation Wing without independent enquiry or corroborative material linking the assessee to the alleged accommodation entries.

Analysis: The addition was founded only on departmental information arising from a search on third parties and on the assessee's non-compliance. The factual finding recorded below was that no independent enquiry, bank verification, or other corroborative evidence was undertaken to trace the flow of funds or establish a direct nexus between the assessee and the alleged entry providers. The assessee denied the transactions, and the Revenue did not place any material to controvert those findings. In the absence of transaction-specific proof, the alleged accommodation entry remained a matter of suspicion, and suspicion alone could not justify an addition under section 68.

Conclusion: The deletion of the addition was upheld and the Revenue's challenge failed.

---