SECTION 209
BOOKS OF ACCOUNT
Whether cost
accounting records can be maintained by entries in pencil in terms of
requirement of the section
A case has come to the notice of
the Government where certain cost accounting records of a company were
maintained in pencil. The question
whether accounting records could be
maintained by entries in pencil was examined by the Department in the light of
the requirement under section 209, that proper books of account shall be kept
by every company. Further sub-section
(4A) of section 209 provides that the books of account, etc., relating to a
period of not less than 8 years shall be maintained in good order. It has been decided that having regard to
the provisions of section 209, books of account required to be maintained under
section 209 should be prepared and maintained in indelible ink for giving a
proper and adequate meaning to the words "proper books of account" in
section 209.
* CIRCULAR NO.2/83,
DATED 2.3.1983.