Income tax Department carries out nation-wide verification exercise on Restaurants suppressing turnover
As per Press Release issued by CBDT, Income tax Department carried out investigation relating to tax evasion pattern in Food & Beverage sector in November 2025. During the exercise, it was found that several restaurants were engaged in deletion of bulk bills and other modifications to suppress the actual sales.
Advanced analytics of transactional data from about 1.77 lakh restaurants in the F&B sector was carried out using AI-enabled analytical tools. The data was compared with the turnover declared in their Income Tax Returns. The analysis revealed largescale under-reporting of income. In some cases, recorded sales were not fully reflected in financial accounts or tax filings, and certain transactions were excluded from reported sales.
Consequently, on 8 March 2026, a nationwide survey was conducted on 62 restaurants across 46 cities in 22 States. On a preliminary basis, the exercise revealed suppression of sales amounting to around Rs. 408 Crores. Investigations in this regard are underway.
The Department continues to emphasise voluntary compliance and a trust-based approach. It has commenced the SAKSHAM NUDGE campaign to guide and advise taxpayers to correct their mistakes. Taxpayers are encouraged to file updated returns under Section 139(8A) of the Income Tax Act. In the first phase, emails and messages will be sent to the identified 63,000 restaurants, requesting them to update their returns before 31 March 2026.
Applicability of ICAI Guidance Note on Financial Statements of Non-Corporate Entities/LLPs for FY 2025-26 and 2026-27 ICAI has issued an…
CBDT has issued revised requirements of DIN referencing in Income Tax notices etc. and exceptions Section 292B of Income Tax…
When property purchased and sold within same year both sale and purchase price has to be adopted by applying same…
ICAI defers the mandatory effective date of SQM 1 and SQM 2 The Council of ICAI, at its 451st Meeting…
Addition deleted as it was made on the basis of letter of District Magistrate which not recovered during the search…
Banks not required to deduct TDS under Income Tax Act 2025 on interest income below threshold limit - CBDT clarification …