Zavaray S. Poonawalla, chairman, GST Cell, and council member, Turf Authorities of India (TAI), along with his team and senior counsel Aryama Sundaram made a presentation addressing the adverse impact of GST on horse racing to the Group of Ministers (GoM) on Tuesday.
TAI, the apex body for horse racing in the country, cited Supreme Court and High Court judgments that establish the fact that GST on prize money does not fall in the ambit of actionable claim as far as horse racing is concerned.
Since its regularisation in 2017, the GST Act on actionable claims has raised ambiguity and concern for affected industries. The varied interpretation and perceptions of the actionable claim clause in the Act imply shortcomings that have triggered deliberations and a need for correction.
Inconclusive
It has been almost three months since the GoM was formed to study the intricacies of GST application on horse racing and in spite of several meetings, the matter remains inconclusive.
“All bets placed at race courses are through an electronic foolproof system called Totalizator. A small fixed percentage of the bet amount is charged as a service fee purely for organising the event of horse racing and for equestrian welfare including the workforce involved. It is the only amount retained by the club as commission and the club in no way is a part of the bet whatsoever. Race clubs are non-profit organisations governed by set guidelines and managed by honorary committee members” explained Mr. Poonawalla.
“The horse racing industry in India has witnessed a sharp decline in its operations since the evolution of GST and is now on the verge of close down. It is a great misfortune for our country and horse lovers that one of the oldest sports in the world is losing its glory while it continues to thrive in other developed countries, which unlike India have no history of horse racing.
“We have made every effort backed with facts and credentials to substantiate our appeal on GST reform and we humbly hope that justice will prevail and the GST Council will accede to our appeal on basis of merit,” said Mr. Poonawalla.
