Maintaining Books of Accounts and Records in a Simplified Manner under GST

Maintenance of accounts and records has always been an important concept. The same is under GST also, but the rules are different. GST Council in its 16^th meet held on June 11, 2017, finalized the rules related to maintenance of accounts and records.

In this write- up, all rules related to maintenance of accounts and records are covered.

Every registered person shall keep and maintain the following accounts and records:

Showing true and correct account of the goods or services

Every registered person shall keep and maintain, in addition to the particulars mentioned in section 35(1), a true and correct account imported or exported or of supplies attracting payment of tax on reverse charge along with relevant documents, including invoices, bills of supply, delivery challans, credit notes, debit notes, receipt vouchers, payment vouchers, refund vouchers and e-way bills. [Rule 1(1)]

Accounts of stock in respect of goods received and supplied

Every registered person, other than composite dealer (section 10) shall maintain accounts of stock in respect of goods received and supplied by him, and such account shall contain particulars of opening balance, receipt, supply, goods lost, stolen, destroyed, written off or disposed of by way of gift or free sample and balance of stock including raw material, finished goods, scrap and wastage thereof. [Rule 1(2)]

A separate account of advances received, paid and adjustments

Every registered person shall keep and maintain a separate account of advances received, paid and adjustments made thereto. [(Rule 1(3)]

Account, containing details of tax payable, collected & paid etc.

Every registered person, other than composite dealer (section 10), shall keep and maintain an account, containing the details of tax payable (including tax payable in accordance with the provisions of sub-section (3) and sub-section (4) of section 9), tax collected and paid, input tax, input tax credit claimed, together with a register of tax invoice, credit note, debit notes, delivery challan issued or received during any tax period. [Rule 1(4)]

Maintaining monthly production accounts, showing quantitative details

Every registered person manufacturing goods shall maintain monthly production accounts, showing quantitative details of raw materials or services used in the manufacture and quantitative details of the goods so manufactured including the waste and by products thereof. [Rule 1(12)]

Maintaining accounts showing quantitative details of goods

Every registered person supplying services shall maintain the accounts Showing quantitative details of goods used in the provision of services, details of input services utilised and the services supplied. [Rule 1(13)]

Every Registered person shall keep the particulars of:-

[Rule 1(5)]

If any taxable goods are found to be stored at any place(s) other than those declared above without the cover of any valid documents, the proper officer shall determine the amount of tax payable on such goods as if such goods have been supplied by the registered person

Where Books of accounts are to be maintained..??

Every registered person shall keep the books of account at the principal place of business and books of account relating to additional place of business mentioned in his certificate of registration and such books of account shall include any electronic form of data stored on any electronic device. [Rule 1(7)]

Important points to be considered:

• Any entry in registers, accounts and documents shall not be erased, effaced or overwritten, and all incorrect entries, otherwise than those of clerical nature, shall be scored out under attestation and there after correct entry shall be recorded and where the registers and other documents are maintained electronically, a log of every entry edited or deleted shall be maintained. [Rule 1(8)]
• Each volume of books of account maintained manually by the registered person shall be serially numbered. [Rule 1(9)]
• Unless proved otherwise, if any documents, registers, or any books of account belonging to a registered person are found at any premises other than those mentioned in the certificate of registration, they shall be presumed to be maintained by the said registered person. [Rule 1(10)]
• Accounts maintained by the registered person together with all invoices, bills of supply, credit and debit notes, and delivery challans relating to stocks, deliveries, inward supply and outward supply shall be preserved for the period as provided in section 36 and shall, where such accounts and documents are maintained manually, be kept at every related place of business mentioned in the certificate of registration and shall be accessible at every related place of business where such accounts and documents are maintained digitally. [Rule 1(16)]
• Any person having custody over the goods in the capacity of a carrier or a clearing and forwarding agent for delivery or dispatch thereof to a recipient on behalf of any registered person shall maintain true and correct records in respect of such goods handled by him on behalf of the such registered person and shall produce the details thereof as and when required by the proper officer. [Rule 1(17)]

In case of Agent [Rule 1(11)]

Every agent referred to in clause (5) of section 2 shall maintain accounts depicting the:

• particulars of authorization received by him from each principal to receive or supply goods or services on behalf of such principal separately;
• particulars including description, value and quantity (wherever applicable) of goods or services received on behalf of every principal;
• particulars including description, value and quantity (wherever applicable) of goods or services supplied on behalf of every principal;
• details of accounts furnished to every principal; and
• tax paid on receipts or on supply of goods or services effected on behalf of every principal.

Registered person executing works contract [Rule 1(14)]

Every registered person executing works contract shall keep separate accounts for works contract showing:

• the names and addresses of the persons on whose behalf the works contract is executed;
• description, value and quantity (wherever applicable) of goods or services received for the execution of works contract
• description, value and quantity (wherever applicable) of goods or services utilized in the execution of works contract;
• the details of payment received in respect of each works contract; and
• the names and addresses of suppliers from whom he received goods or services.

Period of retaining books of accounts and other records [Rule 1(16)]

Accounts maintained by the registered person together with all invoices, bills of supply, credit and debit notes, and delivery challans relating to stocks, deliveries, inward supply and outward supply shall be preserved for the period until the expiry of seventy-two months from the due date of furnishing of annual return for the year pertaining to such accounts and records (as provided in section 36) and shall, where such accounts and documents are maintained manually, be kept at every related place of business mentioned in the certificate of registration and shall be accessible at every related place of business where such accounts and documents are maintained digitally.

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.

Production of books of accounts [Rule 1(18)]

Every registered person shall, on demand, produce the books of accounts which he is required to maintain under any law in force.

Generation and maintenance of electronic records (Rule 2)

Back-up of records

(1) Proper electronic back-up of records shall be maintained and preserved in such manner that, in the event of destruction of such records due to accidents or natural causes, the information can be restored within reasonable period of time.

Production of documents

(2) The registered person maintaining electronic records shall produce, on demand, the relevant records or documents, duly authenticated by him, in hard copy or in any electronically readable format.

(3) Where the accounts and records are stored electronically by any registered person, he shall, on demand, provide the details of such files, passwords of such files where necessary for access and any other information which is required for such access along with sample copy in print form of the information stored in such files.

Hope this information will help you in your Professional endeavors. For further assistance/query, feel free to write back to us.

Author: C S Ekta Maheshwari is the Author of this article and is Company Secretary by profession. The Author can be reached at csektamaheshwari14@gmail.com

Disclaimer: The entire contents of this article is solely for information purpose and have been prepared on the basis of relevant provisions and as per the information existing at the time of the preparation.. It doesn’t constitute professional advice or a formal recommendation. The author has undertook utmost care to disseminate the true and correct view and doesn’t accept liability for any errors or omissions. You are kindly requested to verify & confirm the updates from the genuine sources before acting on any of the information’s provided herein above.