Why the financial Year starts from April 1 and not from January 1

Have you ever thought over it?

According to some scholars, the reasons could be as follows:

1. Our Income Tax Act was effective in the year 1961 & functional from april 1962.

2. Usually Christmas and New Year are celebrated in the end of the year, hence it becomes difficult to carry on the accounting work. Since Britishers ruled over India. They started the financial year from 1st April.

3. In India, March & April are considered as agriculturally productive months. In India Rabi is ready by March and harvesting of Kharif starts from April. During Britishers rule most of their tax was collected through agriculture. So the the government started preparing the Annual Budget by keeping this pattern in mind.

Librarian.