AGRICULTURE INCOME NOW AN EASY WAY TO EVADE TAX

AGRICULTURE INCOME NOW AN EASY WAY TO EVADE TAX 

The taxman following a recent directive by Patna High Court is now probing in to “verify” a select number of cases of declaring agriculture income over  1 Crore between assessment years 2011-12 to 2013-14.

The move comes in view of a PIL filed in the Patna High Court where concerns have been raised that some of these declarants could be engaged in routing their unaccounted or illegal funds in the "garb" of farm income thereby leading to instances of money laundering.

A data in this regard said a total of 2,746 entities have declared agricultural income of above Rs 1 crore in the last nine AYs, viz. 2007-08 to 2015-16 and a probe has to be conducted for a block period of three AYs (2011-12 to 2013-14). 

While the income has been claimed in during the block of 9 Assessment years the probe has only been initiated for a block of 3 years said the department. The primary objective of the probe is to verify the “genuineness” of the declared income, said the official.

Agriculture income is exempt in India by virtue of Section 10 of the Income Tax Act, 1961. Department suspects that, the claim might be because of data entry error on the part of assesse or it could be a genuine case of tax evasion. Keeping the latter option in mind department has initiated scrutiny based on red flag indicators.

Meanwhile, the initiative of the department has become a political agenda. With Finance Minister claiming that “many prominent people” are being probed for allegedly concealing taxable income as agricultural earnings and told opposition not to claim it then as political victimisation when the names come out. He however refused to share details with opposition pressing him to reveal the names of the so called prominent persons.

Charging Jaitley with misleading the House, Digvijaya Singh (Cong) asked the Finance Minister to reveal the names and "not threaten us."

What is to be noted here is that the report is yet to be sent to the CBDT by the tax officials in respect of the investigation, earliest by March 20 and it will be subsequently presented to the Patna High Court for further action.

 

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