Income Tax - scrutiny assessments in cases of fish farmers - CBDT Instructions
REPRESENTATIONS have been received by the Board regarding difficulties being faced on account of surveys and income-tax scrutiny assessments by fish farmers, being involved in business and profession of running inland fresh water fish tanks specifically in cases where the books-of-accounts are not being maintained by the assessees concerned.
While conducting scrutiny in such cases, issue arises about quantification of income from activity of fish farming during the relevant financial year. As the books-of-accounts are unavailable, an Assessing Officer is required to assess the income from activity of fish farming on estimated basis. While making such estimates on basis of 'per Acre water spread area', it has been reported that there are wide disparities in the figure of income being so estimated as non-uniform yardsticks/benchmarks are being adopted by the different Assessing Officers.
Board notes that conflicting views of the Assessing Officers lead to framing of subjective and high pitched assessments, which besides leading to infructuous work for the Department, causes harassment and grievance to the taxpayer concerned.
Therefore, considering the genuine difficulties (business located in far off and interior areas lacking banking facilities, vagaries of nature including availability of water, lack of education and knowledge of accounting, etc.) to cases of fish farmers, Board is of the view that uniform and appropriate norms may be applied while computing income form fish culture on basis of 'per Acre of water spread area'. To ensure consistency in approach a Committee comprising of two Commissioners and two representatives of the fish farmers or fish farmers' association may be constituted by the Pr. Chief-Commissioner to determine reasonably the income that may be estimated for the financial year. In making such a determination, due consideration of various local factors and inputs from the concerned agency of the State Government may also be obtained. A suitable standard benchmark may also be adopted for estimating water spread of fish farmers area as a percentage of total land area.
Board reiterates that the guideline applies only to cases of fish farmers running inland fresh water fish tanks, who are not maintaining books-of-accounts in the regular course of business as per the requirement of section 44AA(2) of the Act.
CBDT Instruction No. 8/2014, Dated: October 27, 2014