Deltatech Gaming files writ petition against Rs 6384 crore GST notice, matter to be heard on Nov 29

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Deltatech Gaming Limited, a subsidiary of listed gaming and hospitality company Delta Corp Limited, has filed a writ petition in connection with the showcause notice of Rs 6384 crore served to the company by the DGGI on October 13.

The case, Deltatech Gaming Limited v. Union of India, is listed for hearing in the Calcutta High Court before a single judge bench of Justice Md. Nizamuddin on November 29.

Deltatech Gaming (earlier known as Gaussian Networks Private Limited) operates online real money gaming platform Adda52, and was acquired by Delta Corp in 2016. Adda52 is one of the most popular poker platforms in India offering various card games.

The company has been involved in several poker tournaments like the World Poker Tour (WPT) which concluded its 4th edition this year in April. It also hosts ‘Poker Night with Stars’ where players can get a chance to win huge sums of cash along with playing with celebrities.

Meanwhile, soon after the tax demand notice was served, Delta Corp clarified their stance on the matter, saying that the claims by the department do not have proper legal backing and will not amount to much in court.

The company was recently granted interim relief in a similar case where Rs 628 crore GST showcause notice was served. A single judge bench of the Sikkim High Court comprising Justice Bhaskar Raj Pradhan ruled in favour of the company and listed the matter for final hearing in February 2024.

While the amounts differ, several other online gaming companies have also been served similar notices, asking them to pay taxes for their operation on a retrospective basis.

The first-ever GST notice was served to Gameskraft in September 2022 for Rs 21,000 crore. But in May this year, the Karnataka HC quashed the notice served by the GST department, ruling games offered by Gameskraft in the skill-gaming category.

However, the matter was revived again in September after the Supreme Court put a stay on the Karnataka HC’s decision. A three-member bench headed by the Chief Justice of India gave its verdict after an appeal was made by the DGGI in the matter.

The subsequent date of hearing, October 10, was listed. However, it could not take place due to constitutional bench matters. The next hearing in the Gameskraft matter is now listed for December 15, 2023.

Meanwhile, other online gaming companies have also filed cases across different High Courts with the most recent one being Vision11 and Twelfth Man Fantasy who were issued a stay on their GST notice by the Gujarat HC.