Maintenance of Books of Accounts under the different Acts

Maintenance of Books of Accounts under the different Acts

Maintenance of Books of Accounts and their retention period under different Acts / Laws are summarized in the tabulated form below:

Act / LawMeaning / Definition of Books of AccountsWho is required to maintainRetention PeriodWhere to Keep
Companies Act 2013“Books of Account” includes records maintained in respect of—
(i) all sums of money received and expended by a company and matters in relation to which the receipts and expenditure take place;
(ii) all sales and purchases of goods and services by the company;
(iii) the assets and liabilities of the company; and
(iv) the items of cost as may be prescribed under section 148 in the case of a company which belongs to any class of companies specified under that section;
Every companyNot less than 8 financial years immediately preceding a financial yearRegistered office


Other place in India as the Board of Directors may decide and where such a decision is taken, the company shall, within seven days thereof, file with the Registrar a notice in writing giving the full address of that other place
CGST Act 2017Account of-
(a) production or manufacture of goods;
(b) inward and outward supply of goods or services or both;
(c) stock of goods;
(d) input tax credit availed;
(e) output tax payable and paid; and
(f) such other particulars as may be prescribed
Every registered personUntil the expiry of 72 months from the due date of furnishing of annual return for the year pertaining to such accounts and records*Principal Place of Business


Where more than one place of business is specified in the certificate of registration, the accounts relating to each place of business shall be kept at such places of business
Income-tax Act 1961(I) For Specified Profession:

(i) a cash book;
(ii) a journal, if the accounts are maintained according to the mercantile system of accounting;
(iii) a ledger;
[(iv) carbon copies of bills, Provided that nothing in this clause shall apply in relation to sums not exceeding twenty-five rupees;]
(v) original bills

Additional records for Medical Profession:
(i) a daily case register in Form No. 3C;
(ii) an inventory [under broad heads,]

For More Details: Rule 6F

(II) For Business and Profession (Other than Specified)

keep and maintain such books of account and other documents as may enable the Assessing Officer to compute his total income 
 (iSpecified Profession:
total gross receipts exceed Rs. 1,50,000/- in all the 3 years immediately preceding the previous year

Note on Newly Set up: Total gross receipts for that year are likely to exceed Rs. 1,50,000/-

(ii) Business or Profession (other than above)**:
income exceeds Rs. 1,20,000/-
or total sales, turnover or gross receipts, exceeds Rs. 10,00,000/- in any 1 of the three years immediately preceding the previous year;

Note on Newly Set up: Income exceeds Rs. 1,20,000/-
or his total sales, turnover or gross receipts, exceed Rs. 10,00,000/- during such previous year;


(iii) where assessee has claimed his income to be lower than the profits or gains u/s 44AE or section 44BB or section 44BBB,


(iv) where the provisions of sub-section (4) of section 44AD are applicable in his case and his income exceeds the maximum amount which is not chargeable to income-tax (Rs. 2,50,000/-) in any previous year.
6 years from the end of the relevant assessment year (i.e.  total of 7 financial year from the end of relevant year).***Principal place of business

*Provided that a registered person, who is a party to an appeal or revision or any other proceedings before any Appellate Authority or Revisional Authority or Appellate Tribunal or court, whether filed by him or by the Commissioner, or is under investigation for an offence under Chapter XIX, shall retain the books of account and other records pertaining to the subject matter of such appeal or revision or proceedings or investigation for a period of one year after final disposal of such appeal or revision or proceedings or investigation, or for the period specified above, whichever is later.

**For individual or a Hindu undivided family (HUF):
Income Limit = Rs. 2,50,000/-
Sales / Turnover / Gross Receipt Limit = Rs. 25,00,000/-

***Where the assessment in relation to any assessment year has been reopened under section 147 of the Act within the period specified in section 149 of the Act, all the books of account and other documents which were kept and maintained at the time of reopening of the assessment shall continue to be so kept and maintained till the assessment so reopened has been completed.

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CA Aastha Singhal