Income Tax Department Detects ₹408 Crore Sales Suppression in Nationwide Survey of 62 Restaurants across 46 Cities
The Income Tax Department uncovered ₹408 crore sales suppression after conducting nationwide surveys on restaurants across multiple cities using AI-driven data analytics
The Income Tax Department has identified the suppression of sales worth nearly ₹408 crore through a nationwide verification drive of restaurants that have been suspected of suppressing their turnover in the food and beverage (F&B)industry.
The investigation into the matter was initiated in the month of November 2025 when the Income Tax Department noticed certain patterns of possible tax evasion in the restaurant industry.
It has been found that several restaurants have been deleting bulk bills and modifying the records of the transactions in order to suppress the actual turnover of the restaurants.
Further, the Income Tax Department has conducted data analytics on the transactional data of around Rs. 1.77 lakh restaurants across the country using AI-enabled analytical tools. The data has been compared with the turnover reported by the entities in the income tax return.
Hence, it has been observed that several restaurants have been involved in the suppression of income, and certain transactions have not been reflected in the financial records.
On the basis of the above results, the Department conducted a nationwide survey on the 8th of March, 2026. It covered 62 restaurants in 46 cities and 22 states. Preliminary results of the survey revealed the suppression of sales of around ₹408 crore. Further investigation in this regard is currently in progress.
The Department has confirmed its commitment to encouraging voluntary compliance through the trust mechanism. In this regard, the SAKSHAM NUDGE campaign has been initiated. Its purpose is to assist taxpayers in rectifying discrepancies.
The Department intends to send emails and messages to the identified 63,000 restaurants regarding the update of their tax returns before the 31st of March, 2026 in accordance with the provisions of the Income Tax Act.
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