Delta Corp will challenge GST tax notice, calling the tax demand arbitrary and against the law

Photo:FILE Delta Corp

online gaming Delta Corp, a company linked to Delta Corp, has received a tax payment notice of Rs 6,384 crore from the Goods and Services Tax (GST) department. However, the company has termed this tax demand as arbitrary and against the law and said that it will adopt all legal means to challenge it. The company said that in the notice, DeltaTech Gaming has been advised to repay the alleged shortfall in tax payment along with interest and penalty. If this is not done, it has also been said that a show cause notice will be sent to the company. According to the notice, the Chief Executive Officer (CEO) and Managing Director of DeltaTech Gaming, being accountable for their day-to-day operations, have also been mentioned to be penalized under the GST law.

Tax liability increased to Rs 23 thousand crores

With this, the total tax demand on the company has increased to Rs 23,000 crore. Delta Corp has said in the information given to the stock market that the Directorate General of GST Intelligence (DGGI), Kolkata has sent a tax demand notice to its subsidiary DeltaTech Gaming on October 13. In this notice, the company has been asked to pay GST of Rs 6,236.8 crore for the period from January 2018 to November 2022. Along with this, another tax demand of Rs 147.5 crore has also been made for the period from July, 2017 to October, 2022. As soon as the news of Delta Corp receiving another notice from the GST department came, there was a big fall in its share price. Shares of Delta Corp fell at Rs 127.7 on BSE, down 8.8 percent from its previous closing price.

It is wrong to demand tax on gross value

Delta Corp says the amount claimed in this notice is based on the gross value value of bets placed on all games played in the relevant period. According to the company, demanding GST on the amount wagered instead of the gross amount taken from the participants in the game is a problem related to the gaming industry and the industry body has already raised this issue with the government. Last month too, a show cause notice was sent to Delta Group to pay taxes worth Rs 16,800 crore. In the GST Council meeting in August, it was agreed to impose GST at the rate of 28 percent on the gross amount of bets placed on online gaming and casino companies. Only after that the GST department has started demanding tax payment from online gaming companies.

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