In a major action against suspected tax evasion in the food industry, the Income Tax Department conducted surveys and raids across several cities including Noida, Ghaziabad, and Lucknow. The operation is part of a nationwide investigation into alleged manipulation of sales records by restaurants to avoid paying taxes.
Officials said the raids were triggered after an AI-driven analysis flagged suspicious financial data from restaurant billing systems and accounting software.
AI-Based Investigation Reveals Possible Sales Manipulation
According to authorities, the surveys were conducted in nearly 45 cities across India, targeting around 70 restaurants and food businesses suspected of suppressing their actual sales figures.
Investigators believe some establishments used billing software manipulation and point-of-sale (POS) systems to hide real transactions. The probe is linked to a larger investigation into an estimated Rs 70,000-crore sales suppression network.
The action was carried out by the investigative wing of the Income Tax Department under Section 133A of the Income Tax Act, under the supervision of the Central Board of Direct Taxes.
Searches Conducted at Popular Food Outlets
In Uttar Pradesh, officials conducted surveys at several well-known food outlets, including:
●Bansal Bikaner in Bulandshahr
●Agarwal Bikaneri Sweets in Noida
●Loknath Sweets in Ghaziabad
During the operation, officials collected digital evidence, including accounting software data, server logs, electronic billing records, and transaction details.
Data Deletion and Multiple Databases Suspected
Preliminary findings suggest that some businesses allegedly used advanced methods to under-report their sales and conceal taxable income.
Investigators found evidence that some establishments may have:
●Deleted transaction data regularly from their billing systems
●Used multiple databases to maintain separate sales records
●Manipulated accounting software through backend access
Officials said the digital evidence is now undergoing forensic examination to determine the full extent of the alleged tax evasion.
Technology Becoming Key Tool in Tax Investigations
Authorities said that with the increasing digitisation of financial transactions, the department is now relying heavily on AI and data analytics to detect suspicious tax patterns.
The nationwide crackdown follows a similar operation in Telangana, where detailed inspections of about 40 restaurants had earlier revealed suspected tax evasion worth around Rs 490 crore.
Officials have advised businesses that may have under-reported income to voluntarily update their disclosures and pay pending taxes to avoid legal penalties or prosecution.
