A.P. govt. cracks down on cashew traders

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Alleged tax evasion the trigger, but industry representatives protest innocence

Workers cleaning cashewnuts at a factory at Palasa in Srikakulam district. — Photo: .Basheer

Workers cleaning cashewnuts at a factory at Palasa in Srikakulam district. — Photo: .Basheer

The Andhra Pradesh Commercial Taxes Department is cracking down on cashew traders of Palasa who have reportedly evaded taxes worth Rs. 50 crore in the last couple of years. According to sources, the department collected strong evidence against several traders who have reportedly not shown their real business transactions and claimed to have made losses.

The department, which could not take action on many traders due to lack of evidence and heavy political pressure from ruling party leaders, had finally succeed in getting information from the Directorate General of Foreign Trade which recorded the import of cashew nuts from African countries like Tanzania, Kenya, Nigeria and other places. The records of DGFT have come as a shot in the arm for the department, enabling the officials to issue notices for immediate payment of taxes. The department reportedly asked a few traders to pay up to Rs. 2 crore.

“The traders are exporting refined cashew to many places in illegal manner. They don’t show the actual production and exports. But now, we could get information based on their imports. The department will attach the properties of the traders if they don’t show actual records and pay taxes immediately,” said an official. However, the traders argued that the cashew industry would not survive if officials continued to ‘harass’ them.

When contacted, Palasa Cashew Manufacturing Association President Malla Srinivasa Rao told The Hindu that the information with the Commercial Taxes Department was not ‘correct’ and the actual imports were made to units located in Odisha. “The industry is already in deep crisis with the labour unrest. Frequent raids and slapping of notices would make cashew traders to shift to other professions,” he added.

‘Bleak scenario’

Cashew nut processing factories in Palasa-Kasibugga of Srikakulam district are being forced to import raw material from African countries like South Africa, Nigeria, Tanzania, Ivory Coast and other countries with the lack of sufficient production within A.P. The State has about 46,913 hectares of area under cashew with an annual production of 12,500 tonnes of raw nuts. Srikakulam, Visakhapatnam, East Godavari, West Godavari, Krishna, Guntur, Prakasham and Nellore are important cashew-growing districts in the State.

The traders depended on other countries for cashew nuts as the production in the State cannot meet their demand. All the manufacturers require at least 2,500 tonnes per day. Otherwise it will lead to huge losses to the mills, causing unrest among the workers. Importing is lucrative for traders as they get per kg at Rs.110. The local prices range up to Rs.130. However, the exact evidence over the each import put traders in the soup, forcing them to pay statutory taxes to the department.

Alleged tax evasion the trigger, but industry representatives protest innocence

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