I-T department conducts searches on onion traders’ premises as prices soar

By: |
October 26, 2021 8:05 AM

Ten days ago, wholesale onion prices for the first time crossed the Rs 4,000 per quintal mark, the highest in the last six months.

onion priceRetail onion prices had gone up to Rs 50 per kg as against earlier prices of Rs 35-40 per kg in major cities like Delhi and Mumbai due to crop damages caused by heavy rainfall.

Searches conducted by the income tax (I-T) department at the premises of seven onion traders in Nashik district have resulted in wholesale onion prices crashing to Rs 2,951 per quintal at Lasalgaon, the country’s largest wholesale market for the bulb, on Monday. Ten days ago, wholesale onion prices for the first time crossed the Rs 4,000 per quintal mark, the highest in the last six months. Retail onion prices had gone up to Rs 50 per kg as against earlier prices of Rs 35-40 per kg in major cities like Delhi and Mumbai due to crop damages caused by heavy rainfall.

Sources from the I-T department revealed that the searches were carried out to ascertain whether these traders in Pimpalgaon Baswant, another major onion market, had any unaccounted-for income and whether they are paying taxes on their total income. In November last year (2020), the I-T department had conducted searches on 11 onion traders in Lasalgaon and Pimpalgaon, after the average wholesale onion prices had crossed Rs 5,000 per quintal mark.

Narendra Wadhawane, secretary, Lasalgaon agriculture produce market committee (APMC) said that onion arrivals have dropped to 4750 quintals on Monday since farmers realised that prices have dropped after the searches conducted by the department. They are holding onto their crop waiting for the prices to improve, he said. Suvarna Jagtap, chairperson, Lasalgaon APMC, said that the atmosphere is a little tense as a result of the searches and had an impact on prices which had crossed the Rs 4,000 per quintal level. At present, farmers are bringing the summer crop to the market and, therefore, arrivals are low since stocks are depleting, she said. “The early kharif crop arrivals should begin after Diwali. But the incessant rains have damaged the crop to the extent of 30-40%. The impact will be known after a couple of months when the farmers will not be in a position to bring the crop to the markets,” Jagtap explained. On Monday, onion arrivals were 4750 quintals at Lasalgaon. Market committee officials at Pimpalgaon said that while arrivals were not impacted, average prices have dropped to Rs 2,900 per quintal from Rs 4,000 per quintal last week as a result of the IT searches.

Significantly, the central government is trying to stabilise the price of onions by releasing buffer stocks in states where onions are being sold above the all-India average price, and where price has been on the rise from last month, the ministry of food and consumer affairs said. The ministry also said that onion stocks are being released on a first-in-first-out basis in the market since the last week of August to ensure prices remain moderate and loss due to storage can be minimised. Consequently, the all-India average retail price of onion was at Rs 37.06 per kg, while the average wholesale rate was Rs 30 per kg on October 14, as a result of releasing onion stocks in a calibrated manner, the ministry added.

“Till October 12, a total of 67,357 tonne have been released in major markets such as Delhi, Kolkata, Lucknow, Patna, Ranchi, Guwahati, Bhubaneshwar, Hyderabad, Bengaluru, Chennai, Mumbai, Chandigarh, Kochi and Raipur,” the official release stated.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Prices of tomatoes spurt 142% in November, no immediate relief: Crisil
2Wheat sowing up 3.36 pc so far: Agriculture Ministry
3Tomato price rises to Rs 75 per kg in national capital