Chandigarh, March 30: Punjab’s Excise and Taxation Minister Harpal Singh Cheema announced on Monday the exposure of a significant ₹200 crore turnover tax evasion racket in the hospitality sector.
Cheema revealed that 882 establishments are currently under investigation, with ₹2.02 crore already recovered. The inquiry is progressing rapidly, and as more data is analyzed, the total amount of evasion could rise to approximately ₹500 crore.
He noted that major urban centers like Mohali, Jalandhar, and Ludhiana have emerged as key areas for concealing turnover. Cheema emphasized that sectors with high cash and hybrid payment transactions are at the center of this fraud.
The minister informed the media that a comprehensive, data-driven investigation campaign has been launched across the state, covering hotels, dhabas, restaurants, bakeries, sweet shops, catering services, and similar establishments. This effort has identified a total of 882 establishments linked to the financial years 2025-26.
He stated, “Further analysis, including data from the financial years 2023-24 and 2024-25, suggests that the total evaded amount could reach around ₹500 crore. So far, 239 cases have been investigated, revealing approximately ₹50 crore in concealed turnover.”
Cheema added, “This evasion includes ₹2.54 crore in tax at a rate of five percent. Our department has ensured the recovery of ₹2.02 crore, and the recovery process is ongoing.”
He highlighted that the analysis has uncovered significant concealment among taxpayers, with over ₹2 crore hidden by three taxpayers, over ₹1 crore by six, over ₹50 lakh by 18, over ₹25 lakh by 26, and over ₹5 lakh by 91 taxpayers.
Cheema concluded that further analysis indicates systematic patterns of underreporting, particularly in segments with high cash and hybrid payments. Dhabas account for about ₹10 crore of the underreporting, followed by small restaurants, coffee, and tea bars at approximately ₹8 crore, and pizza and fast-food outlets at over ₹6 crore.
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