https://www.taxtmi.com/caselaws?id=801971 Section 145(3) permits rejection of accounts that are substantially incorrect or incomplete, including where stock or inventory records and essential purchase, sales and expense ledgers are not maintained or produced. Once books are rejected, net profit must be estimated on a rational, verifiable basis supported by industry standards, business conditions, comparable material or other stated rationale; an ad hoc percentage is insufficient. A preceding five-year average declared net-profit rate may provide the basis for recomputation. Changes in sundry-creditor opening balances require evidence of their nature and source, including confirmations, before treatment as unexplained cash credits. en-us Tue, 06 Oct 2026 00:00:00 +0530 Thu, 29 Oct 2026 06:33:46 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=801971 Section 145(3) permits rejection of accounts that are substantially incorrect or incomplete, including where stock or inventory records and essential purchase, sales and expense ledgers are not maintained or produced. Once books are rejected, net profit must be estimated on a rational, verifiable basis supported by industry standards, business conditions, comparable material or other stated rationale; an ad hoc percentage is insufficient. A preceding five-year average declared net-profit rate may provide the basis for recomputation. Changes in sundry-creditor opening balances require evidence of their nature and source, including confirmations, before treatment as unexplained cash credits. Case-Laws Income Tax Tue, 06 Oct 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=801971