Believe it or not, income figures shared by the Income-Tax Department in response to an RTI application by a retired Indian Revenue Service official has revealed that agricultural income recorded an exponential increase from 2004 to 2013, touching a total of almost Rs.2,000 lakh crore for individual assessees in 2011.
The agricultural income earned by the 6.57 lakh assessees who filed returns in 2011, at nearly Rs. 2,000 lakh crore, is over 20 times the country’s gross domestic product of over Rs. 84 lakh crore at the time, according to the Income Tax Department data shared under the RTI Act. Notably, agricultural earnings are exempt from Income Tax.
Retired IRS official Vijay Sharma — who filed RTI application to the Income-Tax Department — has now moved the Patna High Court seeking further investigations into the matter, raising suspicion that income from undisclosed sources are being shown as agricultural income to evade tax.
“The other possibility may be that illegal money or black money income is being laundered in a large scale and brought into the white economy. It requires deep investigation,” Mr. Sharma told The Hindu . He said the next date of hearing on his PIL plea was in April.
“I had got these details from the Income-Tax Department through an RTI reply last April. Since then I have been writing to the Central Board of Direct Taxes seeking a probe into the matter. Till now, no agency has contradicted the information. In fact, in the Rajya Sabha, the Finance Minister on Tuesday also did not contradict the figures,” said the 1976 batch IRS official.
Finance Minister Arun Jaitley said on Tuesday many prominent people were being investigated by the Income-Tax Department for masquerading taxable income as agricultural. “Please don’t say it is political victimisation if names come out after that [probe],” he said in a reply to the questions raised by the Opposition members.
The Income Tax Department has launched an investigation on those reporting farm incomes of more than Rs.1 crore a year. Official data pegs this number at 307 in assessment year 2015-16, up from 180 in assessment year 2007-08. The Department is probing 2,746 such cases — Bengaluru recording the highest of 321 followed by Delhi with 275 and Kolkata with 239 cases — from across the country.
“Aadhaar will help in this,” Rajiv Kumar, senior fellow at the Centre for Policy Research, told The Hindu . “Now you also really need to do digitisation of land records, and link them to individual identities. This agriculture income figure is completely spurious. It is due to people evading tax.”
“People earning more than Rs. 1 crore from agriculture should pay income tax. They will be an infinitesimal proportion of the total number of farmers,” Mr. Kumar added.
Shocked over the figures, the IRS officer again filed an RTI application seeking access to details of top 100 assesses in the past five years. However, the Income-Tax Department said the disclosure of personal information was prohibited under Section 8 1(J) of the RTI Act, unless there is an overriding public interest.
