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Cyprus-based betting website under scanner for GST evasion

Mumbai, Apr 11, 2023

The director of Parimatch, a Cyprus-based online gambling website, has been arrested in India for operating without GST registration, according to the Mumbai zonal unit of the Director General of Goods and Services Tax Intelligence. The firm's GST liability is estimated at INR20 crore ($2.7m). Many similar websites have emerged in India over the past two years, despite gambling and betting being illegal in the country.

One of the directors of Cyprus-based Parimatch, which runs a popular online gambling website, has been arrested for operating the site in India without GST registration, according to the Mumbai zonal unit of the Director General of Goods and Services Tax (GST) Intelligence.

The department has assessed the GST liability of the firm at around ₹20 crore. The director was produced before an additional chief metropolitan magistrate in Esplanade Court, which remanded him to 14 days judicial custody.

One of the investigators said that the intelligence unit of the GST directorate had been tracking the activities of the company for the past few months. They acted on a tip off that it was operating in India without a GST registration, and consequently, not discharging their GST liability. Users have to pay a basic fee and other charges to the website, but the gambling site has not paid any tax in India.

“The money collected from Indian users is routed through a systematic and layered creation of unauthorised gateways and bogus firms without discharging appropriate GST liability. The company owes the exchequer an outstanding GST of at least ₹20 crore,” said an official from the DG GST Intelligence. He added that the entire operations of the company were managed by a crypto-trading platform from Noida, IBlock Technologies.

The website and the app of the service enables users to place bets on all kinds of sports including e-sports. It also has live betting and online casino sessions throughout the day. It is also known to be associated with several popular football and kabaddi leagues in India.

“As many of the teams in these leagues are owned by prominent businessmen and even movie stars, we feel that the whole racket is used by many of them to park their black money abroad,” said an official.

While gambling and betting are not legal in India, many websites have come up in the last couple of years. They are openly advertising their websites through social media influencers. DGGI says it is looking at other similar operations whose advertisements have increased manifold during the ongoing Indian Premier League.

[The Hindustan Times]

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