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CA Final · Indirect Tax Laws · Accounts and Records; E-way Bill

During an inspection at the Pune office of Kulkarni Components Ltd, a registered person storing all accounts electronically, the proper officer demands the relevant records. The finance manager offers to show them only on the office computer screen, saying the files are password protected and the passwords are confidential. Under the CGST Rules, 2017 on electronic records, which statement is correct?

The registered person must produce the relevant records on demand, duly authenticated by him, either in hard copy or in any electronically readable format. Showing them only on screen and withholding passwords does not comply, because the Rules also require file details and passwords to be provided.

  1. AThe person must produce, on demand, the relevant records duly authenticated by him, in hard copy or in an electronically readable formatCorrect
  2. BThe person may refuse to give passwords because the Rules protect the confidentiality of access codes
  3. CThe person is required to give only a hard copy and cannot give an electronically readable format
  4. DThe officer may seek records only after obtaining a court order

Explanation

The Rules require the registered person maintaining electronic records to produce, on demand, the relevant records or documents, duly authenticated by him, in hard copy or in any electronically readable format. Refusing on confidentiality grounds is therefore wrong, since the Rules also require disclosure of passwords of the files. No court order is needed.

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