Three popular Hyderabad-based biryani chains that came under the scanner for tax fraud may have led authorities to uncover a much larger scam involving manipulation of restaurant billing systems across India.
Officials believe the issue could involve undeclared revenue running into nearly ₹70,000 crore across the food industry.
According to NDTV, the Income Tax Department’s city unit first began investigating these chains over suspected financial irregularities and unaccounted income.
This led to raids at around 30 locations in November last year, including restaurant outlets and the homes of senior management linked to the three brands.
Sources said the raids resulted in the recovery of large volumes of digital data, including UPI transactions routed through multiple accounts. An analysis of this data pointed investigators towards a much wider network of possible tax evasion.
Officials examined nearly 60 terabytes of billing data from a point-of-sale (POS) system used by more than 1.7 lakh restaurant IDs across the country. This significantly widened the scope of the probe to a pan-India level.
The investigation found that a billing software used by thousands of eateries had a “bulk delete” feature that could erase sales records for up to 30 days at a time, leaving little trace.
Other functions, such as deleting individual bills or modifying bills after they were generated, were also allegedly misused.
Tax officials claim these features were used to systematically suppress sales figures, allowing restaurants to under-report turnover and reduce tax payments. Signs of large-scale deletion and alteration of billing records were found during the analysis.
Initial estimates suggest that suppressed sales from 2019–20 onwards could be worth at least ₹70,000 crore. Andhra Pradesh and Telangana alone are believed to account for over ₹5,000 crore of this amount.
Sources also said irregularities were detected across thousands of PAN numbers, with some showing undeclared sales exceeding ₹1 crore.
The Income Tax Department has not yet issued an official statement. However, authorities are continuing to reconstruct deleted billing data, and tax demands, penalties, and possible prosecutions are expected once the investigation is completed.
