Hyderabad: A powerful ‘delete’ button inside a popular restaurant billing software has come under the scanner after tax investigators found it could erase entire chunks of sales history — sometimes up to a month at a time.Officials say the feature, built into widely used point of sale (POS) systems, may have enabled large-scale suppression of turnover while leaving little trace during routine inspections. The discovery emerged during a nationwide crackdown led from Hyderabad, where the income tax investigation unit initially searched a biryani restaurant chain and then expanded the probe to dozens of eateries. Acting under section 133A of the Income Tax Act, officials conducted survey operations to compare what restaurants showed on billing screens with what could be reconstructed from backend data and system logs. In one case in Hyderabad, investigators probing a vegetarian tiffin outlet serving idli, dosa and uttapam alleged sales suppression of nearly ₹60 crore over five years. Officials said similar patterns were observed across day-long tiffin centres, biryani outlets and non-vegetarian restaurants, with some establishments allegedly evading taxes on tens or even hundreds of crores annually. In one instance, a non-vegetarian restaurant was found to have suppressed about ₹20 crore over five years. Tools for suppression Investigators identified four built-in functions that are legitimate in design but, if misused, could reduce reported turnover. The first is individual bill deletion, intended to correct errors. Officials said selective removal of high-value invoices could artificially lower reported sales. The second — now central to the probe — is a bulk deletion function that allows all bills within a chosen date range of up to 30 days to be removed at once. Investigators said they found no visible limit on how frequently this feature could be used, raising the possibility that entire periods of business activity could be wiped from records. Bill modificationsA third function permits post-generation bill modification. Officials cited cases where an invoice of ₹2,784 was allegedly altered to ₹27. While some changes may be legitimate — such as discount adjustments or reconciliations with online delivery platforms — authorities said many involved drastic reductions exceeding 20-30% of the original value. The fourth element is the method used to reconstruct actual turnover. Investigators said they estimated ‘true’ billing by adding deleted invoices and value reductions from modified bills to the remaining front-end sales figure. This reconstructed turnover was then compared with income declared in tax returns to calculate suppression. Based on sample findings from Andhra Pradesh and Telangana, suppression was detected in 2,650 of 3,734 PANs examined. Officials also cited 684 cases where suppressed turnover exceeded ₹1 crore and 231 cases reporting zero or negligible GST turnover. In Hyderabad alone, 416 cases showed suppression above ₹1 crore, while 155 cases recorded suppression exceeding 12 times the declared turnover. AI used to crack network Officials said forensic analysis helped distinguish genuine corrections from suspicious changes. Legitimate edits typically occur on the same day and involve small adjustments, while questionable modifications often happen days or months later — sometimes close to the financial year-end — and involve steep reductions. Bulk edits executed within seconds were treated as a major red flag.To analyse the massive dataset, investigators used high capacity forensic systems and AI tools, including Generative AI. Officials said the technology helped link GST numbers to restaurant entities by scraping publicly available information instead of waiting for responses through official channels. About 15,000 GST numbers were mapped, along with bills uploaded online by customers, to establish connections. Authorities said the findings could trigger broader policy changes, including stricter audit logs for POS software, tamper-proof transaction storage, deeper integration between billing systems and GST reporting, and standardised compliance norms for software providers.
