Indian gaming firm Delta Corp has been granted interim relief b the High Court of Calcutta in relation to a demand for payment of a tax shortfall by the local tax authority.
The Directorate General of GST Intelligence, Kolkata in October issued the demand for payment of Rs 6,384 crore (US$766 million) in alleged shortfall in goods and services tax.
With the amount in question representing almost double the company’s market cap of around US$420 million at the time, Delta Corp noted that the claim was based on the “gross bet value of all games played at the casinos during the relevant period,” not dissimilar to recent moves by India’s GST Council to slap a 28% tax on gaming deposits for operators nationwide.
“Demand of GST on gross bet value, rather than gross gaming revenue, has been an industry issue and various representations have already been made to the Government at an industry level in relation to this issue,” Delta Corp said.
It also promised to pursue “all legal remedies” in challenging the demand.
On Wednesday, the company said the High Court of Calcutta has granted interim relief to its subsidiary, Deltatech Gaming Ltd, which directed that “no effect shall be given to any order passed by the Tax Authority in relation to the show cause notice for the above demand without the leave of the Hon’ble High Court.”
The Sikkim High Court recently issued a temporary stay on a similar demand by the Directorate General of GST Intelligence, Hyderabad for payment of Rs 628 crore (US$75.5 million) in back taxes allegedly owed for the operation of Casino Deltin Denzong, based out of Sikkim.
