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Delta Corp, a prominent casino chain, disclosed to stock exchanges on October 14 that its subsidiary, Deltatech Gaming, received a notice demanding payment of a shortfall tax amounting to Rs 6,384 crore.
Deltatech Gaming, previously known as Gaussian Networks, operates popular gaming apps like Adda52 and Addagames.
In an official exchange filing, the company stated, “The GST notice instructs Deltatech Gaming Limited to settle the alleged tax shortfall, including interest and penalties, failing which the Company will receive a show cause notice under Section 74(1) of the CGST Act, 2017.”
This recent tax notice has pushed Delta Corp’s total tax shortfall liability to Rs 23,206 crore. In contrast, Delta Corp’s market capitalization is currently at Rs 3,749 crore.
On September 22, the company received a direct tax notice of Rs 11,140 crore. Additionally, notices for Rs 5,682 crore were issued to three of its subsidiaries: Casino Deltin Denzong, Highstreet Cruises, and Delta Pleasure Cruises. According to the company, the amounts specified in all these notices are calculated based on the gross bet value of games played.
The company expressed, “Demand for GST on the gross bet value, rather than the gross rake amount, has been a longstanding industry concern, and we have already made several representations to the Government at an industry level regarding this issue.”
Casinos and online gaming companies are struggling with the GST council’s decision to impose a 28 percent tax on the full face value of chips purchased for playing. This means that players receive only Rs 72 to bet for every Rs 100 worth of chips bought. In the past, GST was levied solely on net house winnings.
