Mukul Agrawal Stock Delta Corp Gets Tax Notice of Rs 11,139 Cr

The largest casino operator in India, Delta Corp, has got notification that it must pay a deficit tax of Rs 11,139 crore. According to a stock market statement, the company has received notification in this respect from the Directorate General of GST Intelligence, Hyderabad.

"The DG Notice advises the Company to pay an alleged tax liability of INR 1,11,39,61,03,423 (Rupees Eleven Thousand One Hundred and Thirty Nine Crore Sixty One Lakh Three Thousand Four Hundred and Twenty Three) along with interest and penalty for the period from July 2017 to March 2022 , failing which a show cause notice will be issued to the Company under Section 74(1) of the CGST Act, 2017 and Goa SGST Act, 2017. The amount claimed in the DG Notice is inter alia based on the gross bet value of all games played at the casinos during the relevant period.

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. The Company 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," said Delta Corp in a stock exchange filing.

"Please note that the Company and/or its subsidiaries have received intimations for payment of shortfall tax under Section 74(5) of the CGST Act, 2017 and Goa SGST Act, 2017, for the period from July 2017 to March 2022, from the Directorate General of GST Intelligence, Hyderabad," as per a stock exchange filing report of Delta Corp.

According to Delta Corp, the company has received tax shortfalls totaling Rs 6,28,20,31,726 by Casino Deltin Denzong in Sikkim, Rs 32,89,94,41,744 from Highstreet Cruises and Entertainment Pvt. Ltd., a subsidiary of Delta Corp, and Rs 17,65,21,80,638 from Delta Pleasure Cruise Company Private Limited, another subsidiary of Delta Corp.

"The amounts claimed in the abovementioned notices are inter alia based on the gross bet value of all games played at the casinos during the relevant period. 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. The Company and its subsidiaries have been legally advised that all the above notices and the tax demands are arbitrary and contrary to law, and the Company and its subsidiaries will pursue all legal remedies available to them to challenge such tax demands and related proceedings," said Delta Corp in a regulatory filing.

On Friday, the shares of Delta Corp closed on the BSE at Rs 175.25 apiece down by 0.03% from the previous close of Rs 175.30. The stock made a 52-week-high of Rs 259.95 on (28/06/2023) and a 52-week-low of Rs 173.75 on (29/03/2023). For April to June 2023 quarter of Delta Corp as per BSE, ace investor Mukul Agrawal held 33,00,000 shares or 1.23% stake in the company.