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Our Bureau

Kochi , April 6

THE Seafood Exporters Association of India (SEAI) on Wednesday said the industry would suspend purchase and production on April 11 before going on an indefinite strike unless the income tax authorities stop proceedings to re-open assessments and withdraw demands of re-worked taxes.

"Our industry is facing a serious crisis of re-opening of assessments by the income tax authorities and heavy demands of re-worked taxation amounts with threats of attachment of bank accounts," SEAI said in a statement.

The industry would suspend its activities on April 11 to protest against the move. If there is no stay on the proceedings of the tax authorities after this, the industry would go on an indefinite suspension of purchase and production from April 25, the statement said.

The associationcites two issues: Inadmissibility of deduction under 80HHC of the Income Tax Act where the derived income as per the Act is negative after deduction of export incentives; and inadmissibility of DEPB (duty entitlement passbook) income as an export income, which effectively blocks DEPB income from qualifying for deduction under 80HHC.

"The entire method of arriving at the `profits of business' and not allowing deduction when negative profit is derived, is unfair. The solution would like in a suitable notification being issued by the Finance Ministry with retrospective effect... " SEAI said.

On DEPB not being treated as an export incentive under Section 80 HHC, the association said it was only a neutralisation of the incidence of custom duty on the import of content of the export product. "It is an effort to gather more revenue at the cost of the objectives of the Government's policy. This is a breach of trust that the export sector had placed in Government policy," it said.The association said the industry's action would be informed to other trade organisations such as the Federation of Indian Export Organisation, the Leather Export Promotion Council, textile associations and other trade organisations.

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