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

Sundaram Textiles Pvt Ltd, a registered person in Coimbatore, keeps all its accounts and records in electronic form on a server at its factory. The IT head proposes to keep no separate copy anywhere, arguing that the server is reliable. Under the electronic records provisions of the CGST Rules, 2017, what is required of the company?

The company must maintain and preserve proper electronic back-up of its records, so that if they are destroyed through accidents or natural causes, the information can be restored within a reasonable period of time. The obligation is unconditional and does not depend on a notice, turnover threshold or monthly filing.

  1. AProper electronic back-up must be maintained and preserved so that the information can be restored within a reasonable period if the records are destroyed by accidents or natural causesCorrect
  2. BA printed copy of every record must be filed with the jurisdictional officer every month
  3. CBack-up is needed only if the company's turnover exceeds the prescribed threshold for e-invoicing
  4. DBack-up is needed only after the proper officer issues a notice asking for it

Explanation

The Rules require proper electronic back-up of records, preserved so that information can be restored within a reasonable time if records are destroyed by accidents or natural causes. The requirement is not conditional on a notice or a turnover limit, and no monthly filing of printed copies is prescribed. Hence relying on a single server is non-compliant.

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