Listed casino and hospitality operator today informed the stock exchanges that it has received an intimation by the Directorate General of GST Intelligence, Hyderabad for payment of Rs 11,139 crore shortfall tax under GST along with interest and penalty for the period from July 2017 to March 2022. The amount of GST is based on gross bet value of all games played during the relevant period.
“The DG Notice advises the Company to pay an alleged tax liability of INR 1,11,39,61,03,423 along with interest and penalty for the period from July 2017 to March 2022,” Delta Corp said in the regulatory filing. Notably, the longtime CFO of Delta Corp resigned recently.
Delta Corp also mentioned that it has been legally advised that the DG Notice and the tax demand is arbitrary and contrary to law, and the company will pursue all legal remedies available to it to challenge such tax demand and related proceedings.
The Supreme Court a few days earlier stayed the Karnataka High Court’s (HC) judgment of quashing the show-cause notice of Rs 21,000 crore to GamesKraft by the GST department. N. Venkatraman, the additional solicitor general appearing on behalf of the GST Department before the Supreme Court submitted that due to decision of the Karnataka High Court 35 showcause notices to other online gaming companies have not been issued.
The fresh notice to Delta appears to be in the backdrop of the stay granted by Supreme Court. This intimation notice is more than the entire turnover of Delta in the last ten years.
Today, Delta Corp has disclosed to the exchanges an intimation from the GST department about a potential liability of Rs 11,139 crores. This is if GST is levied on “the gross bet value of all games played at the casinos during the relevant period”.
The potential demand is… pic.twitter.com/vxpixxBpZF
— Ajay Rotti (@ajayrotti) September 22, 2023