The Karnataka High Court has refused to quash proceedings initiated against licensed and unlicensed bookies operating within the Bangalore Turf Club who allegedly collected GST from the punters and TDS amount from the winning bettors.
It was alleged that the accused have misappropriated crores of money collected by them towards payment of GST and TDS. As per the prosecution case, CCB Unit received information that certain bookies in Bangalore Turf Club were accepting betting on the horse races, without maintaining proper registers, documents etc. with regard to the amount collected by them from the punters and thereby they were evading tax payable to the State.
An FIR was lodged by High Grounds Police Station and as many as 66 persons were arrested. 9 persons were absconding. The petitioners argued that they are licensed to collect the betting amount from punters and even if the allegations are presumed to be true, it is only competent GST Officers, who can take action and not the police.
The prosecution opposed the pleas contending that petitioners have been issuing betting cards that are not in the requisite format and the same does not even contain tax invoices or GST numbers.
An allegation was raised against the accused that the licensed bookies who have collected GST amount from the punters and TDS amount from the winning bettors have failed to deposit the same before the competent authority. They have also failed to maintain proper registers and documents in their stalls and have failed to give proper receipts to the punters for having collected the betting amount. So far as the unauthorised bookies, who had no licence or authorization from the competent authority to collect the betting amount from the punters, the allegation is that they have collected betting money from the public representing themselves to be licensed bookies and the money so collected by them from the punters was not being properly accounted nor was proper receipts being given to the same.
The bench noted that offence under Section 78(1)(a)(i) would not get attracted for betting accepted or collected by licensed bookies on the day on which the horse race is run in an enclosure set apart for a race course by the licensee of such race course, provided the licensed bookies have strictly complied the terms of the licence. However, insofar as the unlicensed bookies are concerned, the offence under Section 78(1)(a)(i) of the Act gets attracted as they are not covered under the exception found in Section 2(7) of the Act.
A single judge bench of Justice S Vishwajith Shetty dismissed the petition seeking to quash FIR registered under Section 78(1)(a)(i) of the Karnataka Police Act, 1963, Section 12 of Karnataka Race Betting Act and Section 420 of Indian Penal Code.
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