Karnataka: Caught in I-T net, fishermen pawns in tax evasion racket

Mangaluru: The income tax raids on the fish processing industry in Dakshina Kannada and Udupi districts have merely touched the tip of the iceberg as only a few of the industries along the 320 km coastline have been raided so far, going by industry sources.

Fishing and fish processing  provide  employment to thousands in these parts and tax evasion is reportedly rampant. "It is true that officials have unearthed tax evasions and unaccounted money during their raids. But there could be many more such cases. The units that were raided are into fish processing (fishmeal) where it is difficult to get away with such things because of the documentation involved. 

The industries that were raided are not involved in politics and there is no communal angle as both  communities were targeted," say sources, explaining that  many hide under the term agriculture- allied activity when it comes to paying income tax.

“As fishing is an agriculture -allied activity , many feel they don’t need to pay income tax. Most of the fishing boats hardly maintain a proper account although they earn in lakhs by selling fish. The owners distribute the money among their employees and keep the rest," they add.

It is said the industries raided had bogus creditors and benami accounts. Sources say both are not new to the industry.

"There are  cases of the same person owning many boats in different name. Some of them own boats in the names of their employees," they reveal.

Also, though honest fishermen genuinely use  government subsidised kerosene for fishing, there are many who reportedly sell it to make money.

"There are many, who own boats only to get subsidised kerosene, which they sell to agents," say sources, claiming that although the fisheries and food departments are aware of this, they prefer to look the other way.

"There is a big lobby ,which nobody wants to deal with. Its  reach is till Delhi and so officials prefer to remain silent," they maintain. 

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