section 145 Rejection of books of Accounts

[Bhavna Mehta]

can books of accounts be rejected if vouchers & supporting are not proper & only on that base, can best judgement be done? whether vouchers are regarded as part of Books of Accounts?

AI Summary

Can books of accounts be rejected for inadequate vouchers? Depends on facts; unverifiable transactions may face AO additions. A query was raised about whether books of accounts can be rejected if vouchers and supporting documents are inadequate, and if best judgment can be applied in such cases. The response indicated that the decision to reject books of accounts depends on the overall facts. If some transactions are unverifiable, the Assessing Officer (AO) may make additions for those specific transactions. The case of Commissioner of Income Tax-VIII vs. M/S Paradise Holidays was referenced, where the Delhi High Court allowed the AO to disallow expenditures not supported by evidence.