Tax authorities raid Saravana Bhavan offices and restaurants

CHENNAI: The sales tax authorities raided the offices and restaurants of Hotel Saravana Bhavan on Thursday on suspicion of tax evasion.

A source from the Sales Tax department, who confirmed the raids, on condition of anonymity, said, “We suspect omissions in sales declaration. We are checking the entire day's sales transactions. We are comparing it with the last declaration made by the hotel.”

"Officials began the raid in big outlets of the chain in Chennai and Kancheepuram early today. We will monitor the sales in all these outlets till they down shutters late in the night.

"We will check the sales in each of the outlets today and then compare it with the previous declaration of sales given by Saravana Bhavan. If the difference is more than 10 per cent, we will flag it for appropriate action," the official said.

Hotel Saravana Bhavan, which on an average attracts 80,000 customers daily across its over-35 outlets in India, cut down food prices in October 2013 due to fall in footfalls. Rivals like Adyar Ananda Bhavan followed suit. On an average, these restaurants slashed prices by 10-20 per cent.

A source at Saravana Bhavan said: "The footfalls increased post price cut which is a common phenomenon everywhere. When price falls demand does up. Anyways our books are clean and we have nothing to hide," he added.

Hotel Saravana Bhavan, which started with a small food outlet in a middle-class neighbourhood in Chennai in 1981, now has more restaurants overseas than in India. The chain now has 35 branches in India and 54 overseas, in places such as the US, Canada, Singapore, West Asia and the UK.