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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 its books of account on an ERP system. A server crash caused by a flood destroyed the primary data. The company's compliance head wants to know what the CGST Rules, 2017 require about electronic records so that information can be recovered after such an event. Which of the following is the requirement?

A registered person keeping electronic records must maintain and preserve proper electronic back-up so that, if the records are destroyed by accidents or natural causes, the information can be restored within a reasonable period of time. The Rules do not require monthly filing of back-ups or hard copies only.

  1. AProper electronic back-up of records must be maintained and preserved so that, if records are destroyed by accidents or natural causes, the information can be restored within a reasonable period of timeCorrect
  2. BRecords must be maintained only in hard copy, since electronic back-ups are not recognised under the Rules
  3. CA back-up of records must be filed with the jurisdictional proper officer every month
  4. DBack-up is needed only for the records of the last quarter, and older records may be discarded

Explanation

The Rules on electronic records require proper electronic back-up that is preserved so that, after destruction through accidents or natural causes, the information can be restored within a reasonable period. The Rules prescribe no monthly filing of back-ups with the officer and no hard-copy-only rule. They also set no limit of one quarter for back-ups.

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