Marcantile Basis

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CA VIKASH AGARWAL (Querist)
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27 March 2009 It is mandatory to keep books of accounts of a company on accural basis

if we want to maintain our book of accounts on cash basis
it is allowable or not according to Indian Companies Act 1956 or India Income Tax Act 1961.

Manmohan ACA, CS

Manmohan ACA, CS (Expert)
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27 March 2009 as per section 209(3) of the C' Act, 1956 proper books of account shall not be deemed to be
kept with respect to the matters specified therein :
(a) if there are not kept such books as are necessary to give a true and fair view of the state of
affairs of the company or branch office, as the case may be, and to explain its transactions;
and
(b) if such books are not kept on accrual basis and according to the double entry system of
accounting.

regards :-)

Jitender

Jitender (Expert)
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27 March 2009 in companies act , u have to maintain books on mercantile basis.

Laxmi Narayana Sahu

Laxmi Narayana Sahu (Expert)
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27 March 2009 According to Section 209 the Accounts it is mandadaty to maintain the books of the Company incorporated under Companies Act 1956 ,if it is not maintained on accrual basis than it will deemed to a situation where proper books of account is not maintained.

Manmohan ACA, CS

Manmohan ACA, CS (Expert)
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28 March 2009 allowed by Income Tax Act but not by Companies Act