Delta Corp gets Rs 6,384-crore notice for short payment of GST; shares tumble 8.8%

New Delhi: In another blow to the company, Delta Corp has received a GST notice for short payment of tax to the tune of Rs 6,384 crore, taking the overall tax demand on the company to over Rs 23,000 crore.

The company said that the tax demands are arbitrary and contrary to law, and added it will challenge them.

DGGI (Directorate General of GST Intelligence) Kolkata on October 13, 2023 has served an intimation notice on Deltatech Gaming, a subsidiary of Delta Corp, seeking GST of Rs 6,236.8 crore for the period January 2018 to November 2022, the company said in a filing on Saturday.

For the period July 2017 to October 2022, another demand worth Rs 147.5 crore has been served, it said.

"The notice advises Deltatech Gaming to pay the alleged tax shortfall along with interest and penalty failing which a show cause notice will be issued to the company...," it further said.

It added: "The notice also states that the CEO and Executive Director of Deltatech Gaming Limited, being in charge of its day to day affairs, is liable for a penalty" under GST law.

The amounts claimed in the said notice are based on the gross bet value of all games played during the relevant period, according to Delta Corp.

Demand of GST on gross bet value, rather than gross rake amount, has been an industry issue and various representations have already been made to the government at an industry level in relation to this issue, the company contended.

"The company and its subsidiary have been legally advised that the above notice and the tax demands are arbitrary and contrary to law, and the company and its subsidiary will pursue all legal remedies available to them to challenge such tax demands and related proceedings," it said.

Last month, the company had been slapped with a showcause notice for alleged short payment of taxes worth Rs 16,800 crore.

The GST notices follow the clarification from the GST Council in August that online gaming firms and casinos are liable to pay a 28 per cent GST on the gross bet value placed on their platforms.

The shares of Delta Corp ended at Rs 127.7 a piece on BSE on Monday, nearly 8.8 per cent lower than the previous close.