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Income tax dept carries out searches at onion wholesalers in Maharashtra

Nanda Kasabe

The Income Tax department on Monday carried out searches in the offices and warehouses of four major traders at Lasalgaon, the largest onion wholesale market in the country.

The searches were carried out under the Essential Commodities Act to ascertain if there was any violation of the stock limit of 500 quintals set by the Centre. Searches were also carried out by the I-T department at 15 locations in Nashik district against 11 traders of which 4 traders belong to Lasalgaon.

The searches begun at noon, sending panic waves to traders that led to the auctions coming to a halt at Lasalgaon and other markets in Nashik district.

The searches were carried out at Satana, Kalwan, Nashik and Pimpalgaon, according to the market committee officials. Officials who did not wish to be named revealed that they first visited the wholesale market and took records of the onion traders. Later, they went to their storage units to verify their claims.

On Monday, the minimum prices of the bulb were Rs. 2,200 per quintal and maximum prices touched Rs. 5,772 per quintals, while modal prices remained at Rs. 4,800 per quintal. Arrivals were in the range of 2,500 quintals. Auctions were stopped in the noon following reports of the searches and it remained shut for the rest of the day, said Suvarna Jagtap, chairman, Lasalgaon Agriculture Produce Market Committee.

Jagtap pointed out that there has been a sharp dip in supplies due to the incessant rains that have battered Maharashtra until a couple of weeks ago, destroying the kharif and the late kharif crops.

Around 80% of the crop has been destroyed and only 5-10% of the stocks of the summer crop remain, she said. The stock limits imposed by the government have also resulted in a dip in supplies, market committee officials said. Back in 2017, I-T officials had searches against onion traders in Nashik, but had failed to uncover much stock.

Since October, a daily report has to be submitted to the deputy district registrar (DDR) on the daily procurement of onion, which has led to a drop in both arrivals and procurement by traders. Arrivals dropped down to 2,000-3,000 odd quintals from 10,000 quintals before September 29. Atmaram Kumbharde, chairman, Chandwad APMC, said that unnecessary panic is being created in the market on the onion issue and the government should take a more lenient view of the market because it is practically not possible to adhere to the stock norms, especially on weekends because of logistic issues.

Last Monday, onion prices had touched Rs. 5,501 per quintal after the market reopened after the weekend-the season’s highest. Thereafter, the prices dropped to Rs. 3,780 per quintal on Tuesday and marginally rose to Rs. 4,300 per quintal on Wednesday. According to APMC officials, the demand-supply gap has caused the price rise at Lasalgaon and a hike in prices is usual when the market reopens after a weekend.

Significantly, the arrivals in the market have not crossed 4,500 quintals over the week. Jaydutta Holkar, former chairman, Lasalgaon APMC, pointed out that that wholesale onion prices had dropped but the retail prices had risen to Rs. 100 per kg in some cities because the stock limits imposed by the government had prevented the free flow of onions across states.

Onion prices have been on a rise since August, as floods in key growing states especially Maharashtra and Karnataka disrupted supplies. The likely fall in area sown to kharif onion further put pressure on prices. Right now, stored onion from rabi crop of last year is being sold in the market.

The recent unseasonal rainfall is reported to have damaged kharif onion crops on 17,500 hectare across Nashik district. Currently, the total area under onion plantation is 53,500 hectare-20,000 hectare kharif and 23,500 hectares of late kharif. The kharif plantation usually takes place between July and August and its harvest begins by October-end. On the other hand, plantation for late kharif takes place between September and October and it is harvested by December-end. At the moment, most of the damage has been caused to kharif onions as plantation was delayed by a month owing to late arrival of monsoon this year. The harvest of kharif onions was expected to begin from the first week of November, but rain played spoilsport.