ITR Filing Guide for Fruit Wholesalers & Agricultural Traders [2025]

India's agricultural markets—better known as mandis—play a crucial role in feeding the nation. Among these, fruit wholesalers and mandi traders form a large part of the informal economy, moving massive quantities of perishable goods daily across cities and states. From local sabzi mandis to large APMC yards, these traders keep the supply chain running smoothly. Despite the size and turnover involved in this sector, many fruit business owners and agri-traders either delay or avoid Income Tax Return (ITR) filing, assuming their income qualifies as agricultural and is tax-free.

But here’s the reality: not all mandi income is exempt.

Many traders buy from farmers and resell produce in bulk, often adding margins, incurring expenses, or even maintaining godowns and transport fleets. This is business income, not agricultural income, and it falls under the purview of income tax laws in India. Whether you're operating a fruit trading firm, acting as a commission agent (arthiya), or running a wholesale outlet in Azadpur Mandi, filing ITR is not just a legal requirement—it’s a smart business move.

Why Should Fruit Wholesalers and Mandi Traders File ITR, Even If They're Exempt?

Even if your income is below the taxable threshold, there are compelling reasons to file your income tax return:

• ✅ Income Proof for Loans and Subsidies: If you plan to apply for a business loan, Kisan Credit Card, Mudra Loan, or any government-backed scheme, the ITR is your most credible income document.

• ✅ Avoid Future Tax Scrutiny: Filing ITR regularly creates a transparent tax history, protecting you from future notices or scrutiny, especially in cases where cash deposits, GST returns, or PAN-linked activities are flagged.

• ✅ Smooth GST-ITR Reconciliation: If you're registered under GST (which is common for large-scale fruit traders), your ITR helps match turnover figures, ensuring clean compliance records.

• ✅ Subsidy Eligibility & Government Schemes: Many agriculture-related subsidies, cold chain grants, and business development schemes require income documentation through filed returns.

• ✅ Asset Declaration & Expansion: Planning to buy a truck, warehouse, or land in the name of your business? Banks, NBFCs, and even co-operative societies ask for ITR copies for the last 2–3 years.

In essence, filing ITR for your fruit business or mandi trade isn’t a burden—it’s a gateway to formal growth.

Who Needs to File ITR in the Fruit and Agricultural Trade?

Now let’s address the question most fruit traders ask: “Do I need to file an income tax return if I’m trading in agricultural goods?”

The answer lies in the nature of your income—is it purely agricultural, or is it business income derived from agri-products?

A. Income Tax Filing Criteria for Fruit Wholesalers and Mandi Traders

As per income tax rules for FY 2024-25:

• If your total income (after exemptions) exceeds ₹2.5 lakh (for individuals below 60), you must file ITR.

• If you're running a fruit trading business, you are considered to be earning business income, which is taxable under the Income Tax Act.

• Even if your income is below the taxable limit, you can voluntarily file ITR to claim refunds or document income.

B. Agricultural Income vs. Business Income: Know the Difference

Here’s where most confusion occurs. Let’s break it down:

• Agricultural Income: Income earned directly from cultivating fruits, like a farmer selling mangoes from their orchard. This income is exempt under Section 10(1).

• Business Income: Income earned by buying and selling agricultural produce, storing it, grading it, or transporting it to markets for profit. This applies to fruit wholesalers, mandi traders, and commission agents. This income is taxable.

So if you're operating from Azadpur Mandi, Koyambedu Market, Vashi Mandi, or similar locations and not growing the fruits yourself, your income is not agricultural. It is business income and requires ITR filing.

C. Tax Rules for Mandi Commission Agents (Arthiyas), Traders & Wholesalers

If you're working as a commission agent (arthiya), your income usually comes as a fixed percentage (1%-2%) on the total transaction value. The IT Department considers this income taxable and expects you to report it under the Business or Profession head.

Here’s how each profile is treated:

If your turnover is under ₹3 crore (as per Budget 2023), you can file under the presumptive taxation scheme (Section 44AD) and pay tax at 8% of gross receipts—no books required. This is ideal for mandi traders and fruit sellers looking for simplified compliance.

✅ Pro Tip from SSCOIndia:

If you're confused whether your income is agricultural or business, or unsure whether you qualify for presumptive tax, our experts can help you assess your status correctly and file your ITR accordingly. We’ve helped hundreds of fruit traders and commission agents across Delhi NCR and India file accurate, hassle-free returns.

In the next section, we’ll dive deeper into which ITR form is right for mandi traders and fruit businesses, and how the presumptive taxation scheme under Section 44AD can save time, paperwork, and tax.

👉 Ready to file your ITR?
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Choosing the Right ITR Form for Fruit Wholesalers

When it comes to filing income tax returns for fruit traders, one of the most common questions is: Which ITR form should I use? For mandi traders, wholesalers, and fruit vendors, selecting the correct return form ensures smooth processing, fewer notices, and better compliance under Indian tax laws.

ITR-3 vs ITR-4 for Mandi Traders

Let’s break it down:

• ITR-3 is meant for individuals and HUFs (Hindu Undivided Families) having income from business or profession, where regular books of account are maintained.

• ITR-4 (SUGAM) is designed for small businesses and professionals who opt for presumptive taxation under Section 44AD, 44ADA, or 44AE. This is where most fruit wholesalers and agricultural mandi traders fall, especially if their total turnover is less than ₹3 crore and they are not maintaining formal books of account.

If you’re a fruit wholesaler operating in a mandi and you maintain full records of sales, expenses, purchases, and keep detailed books of account (like a ledger, journal, balance sheet), then ITR-3 may be more suitable.

But if you prefer simplicity and your turnover is within limits, ITR-4 under presumptive taxation is your best friend.

When to Use ITR-4 Under Section 44AD

Section 44AD offers a hassle-free method for small traders, including fruit and vegetable vendors, to file income tax returns without maintaining books of account. Here’s when you can use ITR-4:

• Your total sales or turnover is less than ₹3 crore (updated for FY 2024-25).

• You are an individual, HUF, or partnership firm (not LLP).

• You are engaged in eligible business, like fruit selling, mandi trading, or agri-commodity wholesale.

• You declare at least 8% of your turnover as income (or 6% if all receipts are digital).

Example:
If you earned ₹1.2 crore in the last financial year selling apples, bananas, and seasonal fruits, and all transactions were digital, you can declare 6% of ₹1.2 crore = ₹7.2 lakh as your income. That’s it! No ledger, no P&L, just file ITR-4 with this declared income.

Cases Where Regular Books of Account Are Needed

Despite the advantages, presumptive taxation isn’t for everyone. You must maintain regular books and file ITR-3 if:

• You are not eligible under Section 44AD (example: running a cold storage or fruit processing unit).

• Your turnover exceeds ₹3 crore.

• You wish to declare lower income than 8% (or 6%), and want to claim business expenses.

• You want to carry forward losses or depreciation.

• You are subject to tax audit.

Pro Tip:
If you’ve filed under presumptive taxation for one year, and in the next year you switch back to regular filing, you cannot opt back into 44AD for five years. So choose wisely or consult experts like SSCOIndia.com before locking your return form.

Presumptive Taxation Scheme for Fruit Traders

For small fruit traders and agricultural product wholesalers, the Presumptive Taxation Scheme under Section 44AD is a game changer. It removes the headache of complex accounting and helps in quick ITR filing with minimal paperwork.

Let’s break it down for clarity:

What is Section 44AD?

Section 44AD of the Income Tax Act allows eligible businesses to declare profits on a presumptive basis. You don’t need to maintain books of account or undergo an audit. Instead, you declare a fixed percentage of your gross receipts or turnover as income.

This is especially helpful for:

• Fruit wholesalers operating in local mandis

• Seasonal fruit sellers with daily turnover

• Retailers dealing in packaged or bulk fruits

• Mobile vendors selling fruits across regions

Turnover Limit for FY 2024-25

As per the latest rules, businesses with turnover up to ₹3 crore can opt for presumptive taxation provided that their cash transactions are less than 5% of total receipts. That means if you collect most payments via UPI, NEFT, bank transfers, you can benefit.

Declared Income: 8% or 6%?

• 8%: If you receive payments in cash.

• 6%: If all transactions are done digitally.

Example 1 (Cash heavy business):
A wholesaler of watermelon in Azadpur mandi has ₹80 lakh annual turnover. Most buyers pay in cash. Declared income = 8% of ₹80 lakh = ₹6.4 lakh.

Example 2 (Digital business):
A trader selling mangoes online and via bulk orders receives ₹1.5 crore through bank transfers. Declared income = 6% of ₹1.5 crore = ₹9 lakh.

No need to show your expenses like transport, crates, market commission, wastage, etc. The flat rate covers everything.

Key Benefits of Section 44AD for Fruit Business ITR Filing

1. No books required – You don’t need to maintain ledger, stock register, or profit & loss account.

2. No tax audit – Avoid CA audit unless turnover crosses limits.

3. Saves time and cost – Simple computation and faster filing.

4. Income proof – Despite simplified rules, your ITR is valid for loan application, MSME benefits, and government schemes.

5. Reduces scrutiny risk – Presumptive income is accepted as final, reducing risk of notices.

Ideal for Mandi Traders and Small Commission Agents

If you're a commission agent or wholesaler in fruit mandis like Azadpur (Delhi), Koyambedu (Chennai), or Vashi (Mumbai), and your annual turnover is within ₹3 crore, opting for presumptive taxation can save you from a lot of compliance headaches.

But remember, you must file ITR on time – preferably before 31st July 2025 to avoid penalties.

✅ Need Help?
If you’re unsure which ITR form to file or whether you qualify under presumptive taxation, connect with experts at SSCOIndia.com. Our team has helped dozens of fruit traders, commission agents, and agri-business owners stay tax-compliant with ease.

Documents Required for ITR Filing

When filing your Income Tax Return (ITR) as a fruit wholesaler, mandi trader, or agricultural commodity dealer, proper documentation is crucial. Whether you operate through an APMC mandi or independently, these records will form the backbone of your ITR filing and compliance.

📄 Mandi Receipts and Sales Records

Your mandi receipts are your primary proof of income. These are issued when you sell fruits or vegetables through commission agents or mandi traders. For agricultural traders dealing directly with farmers or buyers, purchase and sale bills are critical. Ensure these documents include:

• Quantity sold or bought

• Price per unit

• Names of suppliers or buyers

• Date and location of the transaction

Well-organized sales records help validate your turnover, which is especially important if you’re opting for the Presumptive Taxation Scheme under Section 44AD.

🏦 Bank Statements

Filing ITR for fruit wholesalers often involves reconciling business transactions reflected in your bank accounts. Keep ready:

• Current account statements (if applicable)

• Savings account statements used for business purposes

• UPI or digital wallet statements if you receive payments digitally (e.g., PhonePe, Paytm, BharatPe)

These bank entries should ideally match with your mandi receipts and sales/purchase bills.

📊 GST Returns (If Applicable)

If your total turnover exceeds ₹40 lakhs (₹20 lakhs in some states), GST registration is mandatory. Even if you're below the limit but have opted voluntarily for GST, you must reconcile your GST return figures with ITR income.

Collect the following:

• GSTR-1 (outward supplies)

• GSTR-3B (summary return)

• Annual GSTR-9 (if filed)

• Reconciliation report if there are mismatches

This is especially critical to avoid GST-ITR mismatch notices under scrutiny.

🧾 Basic KYC: PAN, Aadhaar & Business Details

Every individual or entity filing ITR must furnish:

• Permanent Account Number (PAN) – mandatory for ITR filing

• Aadhaar card – must be linked to PAN

• Business registration certificates – if your mandi business is registered as a firm or LLP

• Electricity or rent bills – for proof of business premises (optional but useful for scrutiny)

Keep these ready and updated, especially PAN-Aadhaar linkage to avoid rejection of your ITR submission.

🗂️ Optional But Useful Documents

• TDS certificates (Form 16A/26AS) if tax has been deducted on your mandi income

• Loan statements if you’re claiming interest as business expense

• Crop insurance or subsidy receipts (if applicable)

💡 Pro Tip: Scan and store all documents digitally in a secure folder named by financial year. This simplifies both GST and ITR reconciliation.

GST vs ITR: Matching Returns for Mandi Traders

Many mandi traders and fruit wholesalers in India face ITR-GST mismatch notices, especially during assessment or refund processes. In 2025, the Income Tax Department and GSTN are working in sync to identify non-compliant businesses through AI-powered reconciliation.

Let’s understand how to stay safe and compliant.

🔍 Why Reconciliation Matters

If you're GST-registered and also filing ITR, both returns should report the same turnover. Here's what usually happens:

• You declare ₹60 lakhs turnover in GSTR-1 but only ₹40 lakhs in your ITR under 44AD.

• Or your ITR underreports cash transactions that were part of your GSTR-3B filings.

Such mismatches trigger notices from the Income Tax Department under Section 143(1) or 139(9).

❗ Common Income Mismatch Issues

1. Non-reporting of cash sales in ITR

   • Many agri-traders accept cash at mandis but fail to include it in taxable income. If your GST return has higher sales, the mismatch becomes obvious.

2. Presumptive income not aligning with declared turnover

   • Under Section 44AD, you must declare 8% of gross turnover as income (6% if digital payments). If you declare much less or inflate expenses, it flags inconsistencies.

3. Wrong GSTIN mapping

   • Using another person’s GSTIN or PAN for sales, then claiming the revenue in your ITR, can backfire during scrutiny.

4. Difference between invoice value and actual bank credits

   • If your bank shows ₹80 lakhs in deposits but ITR shows ₹50 lakhs turnover, you will need strong evidence to explain the shortfall.

🛠 Tips to Avoid Mismatch

• Reconcile total sales in GSTR-1 and GSTR-3B with gross receipts in ITR.

• If you have exempt income (e.g., fresh fruits), mention it separately in ITR under “Exempt Income.”

• If claiming presumptive income under Section 44AD, ensure turnover declared matches total invoice value.

• Maintain a summary reconciliation sheet for FY 2024-25 showing monthly sales, purchases, GST paid, and declared income.

🧠 Real-World Example

Rajesh, a fruit wholesaler from Azadpur Mandi, declared ₹45 lakhs turnover in ITR under 44AD. But his GSTR-3B return showed ₹52 lakhs in outward supplies. He received a mismatch notice in FY 2023-24 and had to revise his ITR with interest and penalty.

Lesson: Transparency and reconciliation between GST and ITR filings ensure peace of mind and faster refunds or subsidy eligibility.

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Penalties for Non-Filing or Late Filing

Not filing your Income Tax Return (ITR) on time can lead to financial setbacks, even if you are in the informal sector like fruit wholesale or mandi trading. The Income Tax Department treats non-filers seriously, and penalties can affect your income and credibility.

Late Filing Fees Under Section 234F

If you miss the ITR deadline (usually July 31 for individuals), Section 234F imposes a late fee of:

• ₹1,000 if your total income is below ₹5 lakh

• ₹5,000 if your total income is above ₹5 lakh

For mandi traders who operate on thin margins, this penalty can be significant and avoidable with timely filing.

Interest Under Sections 234A, 234B, and 234C

• Section 234A imposes interest for delay in filing after the due date.

• Section 234B applies if you haven’t paid enough advance tax.

• Section 234C applies if you delay or miss quarterly advance tax installments.

This is especially relevant for traders with incomes above ₹10 lakh or those not under the presumptive scheme.

Impact on Bank Loans and Compliance Ratings

If you plan to apply for:

• Business loans

• Kisan credit card

• Agri-trade subsidies

Then your ITR becomes your official proof of income. Non-filing or late filing can hurt your creditworthiness and even make you ineligible for government schemes or NBFC financing. Banks and lenders now demand consistent ITRs, even for unregistered mandi or fruit sellers.

How SSCOIndia Helps Fruit & Mandi Traders File ITR

At SSCOIndia, we understand the unique challenges mandi-based businesses face. Whether you are a fruit wholesaler, sabzi mandi trader, commission agent, or seasonal produce seller, we help you file your ITR easily and correctly.

Expert Handling of ITR-4 and ITR-3

Our team specializes in:

• Presumptive taxation under Section 44AD (ITR-4)

• Regular income with books of accounts (ITR-3)

• Determining the correct ITR form for your business setup

Whether your turnover is ₹8 lakh or ₹80 lakh, we make sure your income is correctly filed.

Reconciliation with GST Returns

If you’re also filing GST returns, we match them with your ITR to prevent notices. Common errors like:

• Overstated sales in GST

• Underreported income in ITR
  can attract scrutiny.

We provide GST-ITR reconciliation support, ensuring consistency across returns and preventing mismatch penalties.

Personalized Support for Sabzi Mandis & Fruit Agents

• Don't have books of account? No problem.

• Need help calculating income from cash sales? We guide you.

• Not sure if your income is agricultural or business? We help categorize it.

Our services are tailored to mandi businesses, including:

• Fruit commission agents

• Mandi thekedars

• APMC-registered vendors

• Seasonal traders and bulk buyers

✅ CTA:
File your ITR with SSCOIndia today – hassle-free, expert help at mandi-friendly pricing. Get support on GST reconciliation, presumptive tax, and fast e-verification.
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Conclusion

Even if you're working in the informal fruit and mandi trading sector, filing your income tax return is essential in 2025.

• It helps establish your income proof for loans and subsidies.

• It protects you from penalties and interest under various tax sections.

• It increases your compliance score and credit access.

• With Section 44AD's presumptive scheme, you can file ITR without maintaining books.

Platforms like SSCOIndia.com make ITR filing for agricultural traders fast, easy, and accurate. Whether you're a small mango trader or a large fruit distributor, we simplify taxation for the Indian mandi ecosystem.

FAQs

Q1. Is ITR filing mandatory for mandi traders with income below ₹2.5 lakh?
If your total income (excluding agriculture) is below ₹2.5 lakh and you are not covered under any other mandatory condition (like TDS deductions), ITR filing is not compulsory. However, filing is still beneficial to establish income proof.

Q2. Can fruit commission agents file ITR-4 under presumptive taxation?
Yes, if you operate as an individual or HUF and your gross receipts are below ₹3 crore (if digital transactions are over 95%), you can file under Section 44AD using ITR-4, provided you're not a salaried employee or LLP.

Q3. What if my mandi business is seasonal or irregular?
Seasonal income is still taxable. You can still opt for presumptive taxation if you don’t want to maintain books. Declare the annual gross receipts and calculate 8% of it as income.

Q4. Can I claim business expenses under presumptive scheme?
Under Section 44AD, you cannot separately claim business expenses. The 8% income is deemed to cover all costs. If you want to show lower profit or claim expenses, you must shift to ITR-3 with books.

Q5. How do I file ITR if I don’t have a GST number?
You can still file your ITR as a non-GST trader. Many small fruit vendors or mandi agents operate below the GST threshold or are exempt. However, if your turnover exceeds ₹40 lakh (₹20 lakh in some states), GST registration is mandatory.