A routine inspection of biryani restaurants in Hyderabad has led to the exposure of a massive ₹70,000 crore tax evasion scam spanning across India. What initially appeared to be a standard compliance check soon uncovered widespread manipulation of restaurant billing systems.
Investigators found that over one lakh restaurants were using common billing software to record sales. However, many restaurant owners allegedly tampered with the system to underreport income and evade taxes. Officials analyzed nearly 60 terabytes of data from about 1.77 lakh restaurants using advanced digital tools and artificial intelligence.
The probe revealed that after customers paid their bills, several transactions were either deleted or altered in the system. Across the country, restaurants reportedly erased bills worth more than ₹13,000 crore. In Andhra Pradesh and Telangana alone, hidden sales crossed ₹5,100 crore. A physical verification of just 40 restaurants exposed nearly ₹400 crore in unreported sales.
Karnataka recorded the highest evasion, followed by Telangana and Tamil Nadu. Common tactics included deleting only cash transactions, wiping out sales records for selected days or months, and filing tax returns showing artificially low income.
The investigation, which began in Hyderabad and Visakhapatnam, expanded nationwide after authorities realized the scale of the fraud. The findings highlight how digital tools meant to ensure transparency were misused, ultimately uncovering one of the largest tax evasion scams in the restaurant industry.
