PQR Ltd has decided not to preserve the books of accounts and other related records of accounts, more than three years immediately preceding the relevant financial year of 2020-21. Action decided by PQR Ltd is justified

The books of accounts, together with vouchers relevant to any entry in such books, are required to be preserved in good order by the company for a period of not less than eight years immediately preceding the relevant financial year. In case of a company incorporated less than eight years before the financial year, the books of accounts for the entire period preceding the financial year together with the vouchers shall be so preserved. The provisions of Income Tax Act shall also be complied with in this regard. As per proviso to sub-section 5, where an investigation has been ordered in respect of a company under Chapter XIV of the Act related to inspection, inquiry or investigation, the Central Government may direct that the books of account may be kept for such period longer than 8 years, as it may deem fit and give directions to that effect. The decision taken by PQR Ltd is not in accordance with the law and the company cannot do so.