Tax Department Intensifies Crackdown on Restaurant Sector in Rajasthan

The Income Tax Department is ramping up its investigations into the restaurant industry in Rajasthan, following a major raid on Kanha Restaurant that revealed extensive tax evasion. Recent operations have targeted several establishments, including Mango Masala in Ajmer, where officials conducted thorough inspections amidst a bustling dining scene. This crackdown is part of a broader initiative to address suspected manipulation of sales reporting and tax fraud across the sector. With ongoing investigations, the restaurant community is on high alert as more developments are anticipated.

By Narendra Chaudhary Mar 9, 2026, 10:55 IST

Intensified Scrutiny of Restaurants in Rajasthan

Jaipur/Ajmer, March 9, 2026 – The Income Tax Department is tightening its grip on restaurant operators in Rajasthan. Recently, a significant raid was conducted at the renowned food chain 'Kanha Restaurant' in Jaipur, uncovering alleged tax evasion exceeding ₹100 crores, along with the seizure of ₹7.5 crores in jewelry and cash. Following this, the department has taken further action.

According to sources, teams from the Income Tax Department have raided a total of four restaurants in Jaipur and Ajmer. Among these is the popular Mango Masala Restaurant, located at Swami Complex Chowk in Ajmer, where officials arrived unexpectedly on the morning of March 8. At the time, customers were dining, but the team began questioning the staff and thoroughly examining income and expenditure documents, billing records, and other financial paperwork. This operation caused quite a stir in the area, drawing a crowd of onlookers.

Additionally, reports indicate that other restaurants in Jaipur are also under investigation, as part of a nationwide crackdown on tax evasion in the restaurant sector. The department suspects that several establishments are manipulating billing software to underreport sales, leading to significant GST and income tax fraud.

Last month, raids on over 33 locations of the Kanha Restaurant Group (including Jaipur, Mumbai, Udaipur, etc.) resulted in the discovery of millions in cash and jewelry hidden behind walls in secret rooms. The recent action at Mango Masala in Ajmer appears to be an extension of this ongoing investigation.

While the Income Tax Department has yet to release an official statement, sources indicate that the investigation is ongoing, with more revelations expected soon. This marks the second or third major operation in the restaurant industry, causing considerable unrest among business owners.