GST raids on restaurants unearth massive tax evasion
Palakkad, June 29, 2024
A series of raids conducted by GST officers in 42 restaurants since Thursday found a turnover suppression of ₹60 crore.
The State Goods and Services Tax (SGST) department has unearthed tax evasion to the tune of several crores of rupees by several big restaurants across the State. A series of raids conducted by GST officers in 42 restaurants since Thursday found a turnover suppression of ₹60 crore. As much as ₹40 lakh in fine was paid on the first day of the raid.
As many as 250 officers of the Intelligence and Enforcement wings of the department took part in the raids that targeted restaurants in all districts saving Pathanamthitta. The search operations extended to the houses of the restaurant owners and their partners.
GST sources said that 50 teams of the officers zeroed in on 42 restaurants after monitoring them for about six months. “We went after them after collecting sufficient evidence for their tax evasion,” said an officer.
The officers visited the restaurants several times pretending to be ordinary customers. They also closely followed food vloggers and their videos for data collection.
GST sources said that the restaurants resorted to several methods to evade taxes. When some refused to give bills, some others took back the bills along with the cash from the customers. Some others were found to have destroyed the bills and made false accounts by tampering with the software. Some other restaurants issued fresh bill series every day, and gave the bills with the same serial number to multiple customers. Some other restaurants were found to have been collecting money from the customers using the UPI accounts of their employees.
Inspired by the Gen Alpha’s internet slang ‘fanum tax’, meaning theft of food between friends, the State GST department named the raids Operation Phanum.
“Several of the restaurants we examined were found to have been offering outside catering services, for which they never maintained accounts,” said an officer.
The department’s Operation Phanum followed the raids held in May on scrap dealers across the State. The raids on scrap dealers were codenamed Operation Palm Tree, in which taxes to the tune of ₹250 crore were found to have been evaded, and two persons arrested.
[The Hindu]
