In a significant legal development, the Bombay High Court at Goa has admitted three petitions challenging a show-cause notice issued by the Director of Revenue Intelligence, which seeks a whopping GST amount of Rs 11,139 crore for the period spanning from July 2017 to March 2022, specifically related to casino operations.
Harish Salve, the senior counsel representing the companies in question, has confirmed that they intend to respond to the notice by December 15. Of particular interest in these proceedings is the challenge mounted against Section 31A of the CGST Rules.
Dated September 27, 2023, the show-cause notice from the Director of Revenue Intelligence aims to impose GST, in addition to interest and penalties, which collectively could surpass a staggering Rs 22,250 crore. The crux of the director's argument revolves around the allegation of non-compliance by these companies in remitting GST based on the total bet value, as opposed to the consideration actually received by them.
However, the petitioners, namely Delta Corp Ltd, Highstreet Cruises and Entertainment Pvt Ltd, and Delta Pleasure Cruise Company Pvt Ltd, assert that the foundation of the show-cause notice primarily rests on Section 31A of the CGST Rules, 2017.
Furthermore, these petitioners are also challenging other notifications and circulars issued under the CGST Act. It was made clear during these proceedings that no final order will be issued concerning the show-cause notice without the leave of the court.
The division bench, comprising Justices Mahesh Sonak and Bharat P. Deshpande, has directed that the matter be scheduled for a final hearing in February 2024. This development highlights the significant legal battle ahead as the court takes on the complex and substantial issue of GST demands in the context of casino operations.
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