CA Final · Indirect Tax Laws · Accounts and Records; E-way Bill
Kaveri Auto Components Ltd stores its books of account in an accounting software on a server in Pune. A flood damages the server room. Under the CGST Rules text on electronic records, what must the company have ensured beforehand?
The company must maintain and preserve proper electronic back-up of its records so that, if they are destroyed by accidents or natural causes such as a flood, the information can be restored within a reasonable period of time.
- AThat a printed copy of every record is filed with the jurisdictional officer every month
- BThat proper electronic back-up of records is maintained and preserved so that information can be restored within a reasonable period after destruction due to accidents or natural causesCorrect
- CThat records are stored only on a server located in the same premises as the principal place of business
- DThat the records are encrypted so that no password is ever disclosed to anyone
Explanation
The rule requires proper electronic back-up, preserved so that information can be restored within a reasonable period if records are destroyed by accidents or natural causes. Monthly filing of printouts and location restrictions are not in the text. Encryption without disclosure also conflicts with the duty to provide access details on demand.
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