Books of account cannot be rejected solely for missing rokar and khata when other records still verify purchases and sales.

Books of account should not be rejected merely because rokar and khata were not maintained if other books are available and purchases and sales remain verifiable. The High Court noted that the Tribunal had relied on missing vouchers and the absence of evidence regarding a disputed coal delivery order, but had not examined whether the existing records could still verify the transactions or considered the taxpayer's explanations to the objections raised. The matter was therefore required to be reconsidered on the basis of verifiability from the other books of account and the explanations offered.

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Issues: Whether the Tribunal was justified in rejecting the books of account merely because rokar and khata were not maintained and whether the appeal required reconsideration on the verifiability of purchases and sales from other books of account.

Analysis: The order under challenge proceeded on the footing that the absence of rokar and khata, coupled with deficiencies in purchase vouchers and non-production of evidence regarding the disputed coal delivery order, justified rejection of the books. The Court noted that an earlier decision had laid down that books of account cannot be rejected merely for non-maintenance of rokar and khata if other books are maintained and purchases and sales are otherwise verifiable. The Tribunal had not examined whether the existing books permitted verification of the transactions and had not dealt with the applicant's explanations to the objections raised by the assessing authority.

Conclusion: The Tribunal's order was unsustainable and the matter had to be sent back for fresh decision after examining verifiability from the other books of account and the applicant's explanations.

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