https://www.taxtmi.com/caselaws?id=799688 Rejection of books of account under section 145(3) is permissible where primary books, bills and vouchers are not produced and the correctness or completeness of accounts cannot be verified. An audit report does not replace underlying records. Best judgment assessment after such rejection requires an honest estimate with a reasoned nexus to supporting material; rejection alone does not justify an arbitrary expenditure disallowance. Where no specific bogus or inflated expenditure, basis for the selected rate, or corroborative material exists, the quantum requires verification. Audited financial statements from adjacent years may be admitted as additional evidence for verification under the applicable appellate rules. en-us Wed, 16 Sep 2026 00:00:00 +0530 Fri, 25 Sep 2026 08:16:41 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=799688 Rejection of books of account under section 145(3) is permissible where primary books, bills and vouchers are not produced and the correctness or completeness of accounts cannot be verified. An audit report does not replace underlying records. Best judgment assessment after such rejection requires an honest estimate with a reasoned nexus to supporting material; rejection alone does not justify an arbitrary expenditure disallowance. Where no specific bogus or inflated expenditure, basis for the selected rate, or corroborative material exists, the quantum requires verification. Audited financial statements from adjacent years may be admitted as additional evidence for verification under the applicable appellate rules. Case-Laws Income Tax Wed, 16 Sep 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=799688