Consistent method of accounting cannot be disturbed for petty additions

Advocate Akhilesh Kumar Sah Hero Moto Corp Ltd Vs DCIT (ITAT Delhi) If a particular accounting system has been followed and accepted and there is no acceptable reason to differ with it, the doctrine of consistency would come into play; the method of accounting cannot be rejected. Such tinkering with the method is unjustified when the exercise does not materially alter the profits. Petty additions should be avoided on the ground of materiality, as AS-1 which talks about materiality, consistency, prudence etc. is part of the I.T. Act after it is notified under section 145(2). Recently, in Hero...