https://www.taxtmi.com/caselaws?id=239046 Rejection of books under s. 145 was held unsustainable because a mere increase in expenditure compared to the preceding year does not evidence defective or incomplete accounts; where accounts are audited without adverse remarks and correct profit can be deduced, the AO should, at most, make specific/adhoc disallowances rather than reject the books. Accordingly, deletion of book-rejection was upheld against the Revenue. Disallowance of "future losses" claimed by valuing WIP on AS-7 basis was held unwarranted because, though AS-7 is not notified, s. 145 mandates notified standards but does not bar adoption of ICAI standards; applying AS-7 and WIP valuation would appropriately adjust profits across years. The allowance of the claim was upheld against the Revenue. en-us Fri, 17 May 2013 00:00:00 +0530 Tue, 30 Dec 2025 15:57:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=239046 Rejection of books under s. 145 was held unsustainable because a mere increase in expenditure compared to the preceding year does not evidence defective or incomplete accounts; where accounts are audited without adverse remarks and correct profit can be deduced, the AO should, at most, make specific/adhoc disallowances rather than reject the books. Accordingly, deletion of book-rejection was upheld against the Revenue. Disallowance of "future losses" claimed by valuing WIP on AS-7 basis was held unwarranted because, though AS-7 is not notified, s. 145 mandates notified standards but does not bar adoption of ICAI standards; applying AS-7 and WIP valuation would appropriately adjust profits across years. The allowance of the claim was upheld against the Revenue. Case-Laws Income Tax Fri, 17 May 2013 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=239046