Karnataka HC upholds tax evasion case against bookies at Bangalore Turf Club

BENGALURU: The Karnataka High Court has refused to quash a case related to alleged tax evasion by bookmakers operating at the Bangalore Turf Club. The court stated that the evidence collected during the investigation suggested a possible cognisable offence.
The order was passed by a bench headed by Justice S Vishwajith Shetty in response to a petition filed by the bookmakers.The case was registered in January under various laws, including the Karnataka Police Act, IPC, and Karnataka Race Betting Act, following a raid based on information that the bookmakers were accepting bets without proper registration, resulting in tax evasion. The raid led to the seizure of Rs 3,45,74,040.
The bookmakers' counsel argued that they possessed valid licenses and questioned the applicability of the cheating section under the IPC, suggesting it was invoked due to the non-cognisable nature of other provisions. The counsel maintained that any wrongdoing should be handled by GST officers. However, Advocate General Shashikiran Shetty countered these arguments, pointing out that the bookmakers had failed to issue receipts for collected GST and lacked records for TDS. He also highlighted discrepancies between reported bet amounts and expected averages over a specific period.
The bench emphasized that courts should not interfere with investigations if the evidence indicates a prima facie case. It stressed the investigating agency's discretion in invoking penal provisions based on the evidence collected. In its recent order, the court concluded that the allegations and evidence suggested a serious offence involving misappropriation of substantial sums meant for GST and TDS payments. As a result, the bookmakers' petition was dismissed.