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Healthy fish production requires intensive care and ensuring stable and healthy production environment inside the farm tank is a challenging task. An Internet of Things (IoT) based automated system is highly desirable that can continuously monitor the fish tanks with optimal resources utilization. Significant cost reduction can be achieved if farm equipment and water pumps are operated only when required using optimization schemes. In this paper, we present a general system design for smart fish farms. We have developed an optimization scheme for water pump control to maintain desired water level in fish tank with efficient energy consumption through appropriate selection of pumping flow rate and tank filling level. Proposed optimization scheme attempts to achieve a trade-off between pumping duration and flow rate through selection of optimized water level. Kalman filter algorithm is applied to remove error in sensor readings. We observed through simulation results that optimization scheme achieve significant reduction in energy consumption as compared to the two alternate schemes, i.e., pumping with maximum and minimum flow rates. Proposed system can help in collecting the data about the farm for long-term analysis and better decision making in future for efficient resource utilization and overall profit maximization.