“Demonetization” was a historic decision taken by the Indian government to counter the parallel economy of “Back Money” prevalent in the country. Although there were mixed reactions from public, the most important and prominent observation was that the citizens were determined and stood by the government in its decision to purify the Indian economy. In view of characteristics of the restaurant industry to deal in cash, it was natural to see a great impact on the industry by the decision since the situation post demonetization was a complete contrast where there was a severe cash crunch and everyone wanted to preserve their cash holdings for priority purchases. This study aims at viewing the decision of demonetization in the eyes of the restaurant industry and has considered the perceptions of the restaurant owners and customers on various aspects of the topic. The findings of his research suggests that the quality of restaurant food & service is not deteriorated after the decision and Restaurants have not been forced to shut down either temporarily or permanently due to the decision. “Banks not tendering sufficient cash on a daily basis” and “Reduced cash sale” are the major challenge faced by restaurant owners. “Looking for alternative restaurants who accept other mode of payments” and “Willingly shift to cash less payment modes” were the major changes observed in customer behavior.