₹70,000 Crore ‘Fake Biryani Billing’ Scam: Income Tax Department Launches Nationwide Searches on Restaurant Chains

India’s Income Tax Department has launched large-scale searches across major restaurant chains nationwide after uncovering a massive tax evasion network involving manipulated billing software. According to officials, the alleged scam may have concealed restaurant turnover worth nearly ₹70,000 crore over several years.

The investigation began weeks after tax authorities identified suspicious billing practices at a restaurant outlet in Hyderabad. What initially appeared to be a localized discrepancy soon evolved into a nationwide probe after investigators found evidence suggesting that the same billing software may have been used by thousands of restaurants to suppress actual sales figures.

Officials suspect that the manipulated software allowed businesses to record full transactions internally while reporting lower sales figures to tax authorities. This method allegedly enabled restaurant operators to reduce their taxable income and evade significant amounts of tax.

The current searches focus on examining financial records, billing databases, point-of-sale (POS) systems, and accounting documents belonging to restaurant chains operating across multiple states.

How the Investigation Started in Hyderabad

The case originated in November last year when tax officers carried out routine inspections at several restaurants in Hyderabad. During these visits, officials noticed inconsistencies between the sales recorded in billing software and the actual number of customers present at the outlets.

Despite busy dining areas and heavy customer traffic, the sales data displayed unusually low revenue figures. This mismatch immediately raised red flags among investigators.

Initially, authorities believed the issue might be limited to a single restaurant or a small group of outlets. However, further scrutiny revealed that multiple establishments were using the same billing platform, suggesting the possibility of a broader systemic issue.

As the investigation deepened, officials discovered that the software platform was widely used across the Indian restaurant industry.

The discovery significantly widened the scope of the probe, prompting tax authorities to investigate restaurant chains and franchises operating in multiple cities across India.

Massive Data Analysis Reveals Hidden Sales

Investigators reviewed approximately 60 gigabytes of transaction data covering six financial years, from 2019–20 to 2025–26. This analysis focused on how restaurants may have manipulated their billing systems to conceal actual revenue figures.

Authorities suspect that the billing software allowed restaurants to maintain two sets of records. While full sales data remained stored internally, only reduced figures were used when filing tax returns.

Officials believe some of the earliest adopters of the modified software were biryani-focused restaurant outlets in Hyderabad, a city known for its massive demand for the popular dish.

However, investigators now suspect that similar practices may have spread to restaurants across several major cities, prompting a nationwide audit of financial accounts and POS systems used in the sector.

Techniques Used to Suppress Restaurant Turnover

According to officials, restaurants allegedly used several digital techniques to reduce their reported turnover. These methods involved manipulating billing data after transactions had already been recorded in the system.

By deleting selected transactions—especially cash payments—restaurants could significantly reduce the amount of revenue reported to authorities while still keeping internal sales records.

Artificial Intelligence and Data Analytics Used in the Probe

To analyze the scale of the suspected tax evasion network, the Income Tax Department deployed advanced data analytics and Artificial Intelligence tools.

Investigators reviewed records linked to approximately 1.77 lakh restaurant identification numbers. These records were cross-checked with multiple databases including:

• GST registrations
• PAN records
• Financial filings
• Open-source business data

This digital mapping allowed officials to identify suspicious transaction patterns across several states.

In one sample investigation involving 40 restaurants in Andhra Pradesh and Telangana, authorities discovered nearly ₹400 crore worth of unreported turnover.

In certain cases, investigators estimated that restaurants had hidden up to 25% of their total sales from tax authorities.

Biryani Market Under Special Scrutiny

Investigators are paying particular attention to cities where biryani sales form a major portion of restaurant revenue. Locations such as Bengaluru, Chennai, Mumbai, and Hyderabad are now under closer examination.

Officials also compared restaurant sales data with purchases of raw ingredients such as rice, meat, and spices. Significant mismatches between the volume of ingredients purchased and the revenue reported raised further suspicion of concealed sales.

For example, some outlets reported relatively modest sales figures despite purchasing large quantities of raw materials that would normally indicate far higher business activity.

More Billing Software Platforms May Come Under Scanner

According to the Income Tax Department, the current findings primarily relate to one widely used billing software platform within the restaurant industry.

However, authorities have not ruled out the possibility that other point-of-sale systems could also be investigated if similar irregularities emerge during the probe.

Officials say the investigation is still ongoing, and additional restaurant chains may face scrutiny as more financial records are analyzed.

Entities found guilty of concealing turnover or manipulating billing systems could face strict legal action under India’s tax laws.

As the nationwide investigation expands, authorities aim to ensure greater transparency in the restaurant industry and prevent the misuse of digital billing systems for large-scale tax evasion.