Assessee was a SEBI-registered foreign portfolio investor (FPI) who invested in shares of International Conveyors Limited (ICL) in 2010 and sold the shares in 2018-19. The purchase and sale transactions are duly supported by contract notes, Demat statements and custodian records placed before the authorities. The assessee retained the said investment for nearly eight years, which militated against the allegation of a pre-arranged accommodation entry transaction. Apart from placing reliance on the generalized findings contained in the investigation report, no evidence had been brought on record to establish any nexus
whatsoever between the assessee and the alleged operators/ entry providers or beneficiaries. There was nothing on record to suggest that the assessee had any role in the alleged price manipulation activities or had entered into any arrangement designed to generate artificial capital gains.

Even the financial statements of ICL did not support the sweeping allegation that it was merely a shell or paper company devoid of business activity. The material on record indicated that ICL possessed substantial fixed assets, including freehold land, generated revenue of approximately Rs. 99.15 crores during the relevant period, earned profits of approximately Rs. 5.23 crores and reported positive cash flows.

Mere suspicion, however strong, could not take the place of evidence, particularly where the Assessee had furnished complete documentary evidence supporting the genuineness of the transactions.

Hence, the additions were directed to be deleted.