Good news for Delta Corp shareholders! Casino firm gets interim relief from HC on Rs 16,195-cr tax notice

Delta Corp Ltd shareholders can heave a sigh of relief as the Goa Bench of Bombay HC has restrained tax authorities from passing any final order on the Rs 16,195-crore GST notice issued to the casino firm.

Last month, Delta Corp and its subsidiaries had received notices for payment of tax shortfall to the tune of Rs 23,000 crore for the period between July 2017 and March 2022.

Goa bench of Bombay High Court has directed Directorate General of GST Intelligence, Hyderabad not to pass final orders on Rs 16,195-crore tax notice without its prior permission. On Monday, Delta Corp's scrip on BSE closed nearly flat at Rs 130. Shares of the company have been under pressure ever since the GST Council agreed to impose a 28% tax on online gaming, casinos and horse racing.

The company, which operates casinos in Goa and Sikkim, and its two subsidiaries, Highstreet Cruises and Entertainment Private Limited and Delta Pleasure Cruise Company Private Limited, filed writ petitions challenging a notice dated September 27.

"The Hon’ble High Court of Bombay at Goa considered the writ petitions filed by the Company and its subsidiaries on 23rd October, 2023. Basis a statement made on behalf of the concerned tax authorities, the Hon’ble High Court has directed such authorities not to pass any final orders on the captioned show cause notices without the prior permission of the Hon’ble High Court. Dates have been fixed for completion of pleadings, and the hearing and final disposal of such writ petitions," said Delta Corp in a stock exchange filing. Delta Corp had challenged Rule 31A of CGST Rules.

Senior advocate Harish Salve, who appeared for the petitioners, submitted that they would file a response to the show cause notice by December 15, 2023.

The court will now hear the matter on February 5, 2024.

Recently, Sikkim High Court asked DGGI to not take any further action in the matter of Rs 628-crore GST show cause notice to Delta Corp.

Earlier this month, Delta Corp reported 1.6% increase in consolidated net profit at Rs 69.4 crore for the quarter ended September 30, 2023. It reported consolidated net profit of Rs 68.3 crore in the year-ago period.

The company's revenue rose marginally to Rs 270.6 crore in Q2FY24 as compared to Rs 270 crore in Q2FY23.