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Mahadev Scam: Accused Firm Had Share Purchase Pact with Delta

The Enforcement Directorate’s (ED) investigation into the multi-crore Mahadev illegal betting application scam has revealed that one of the accused firms, Ability Games Ltd, entered in to a share purchase agreement with Del ta Corp-a listed company engaged in the casino gaming industry in India, to sell its Nepal-based casino business, court documents reviewed by ET states. In 2023, Delta Corp and its two subsidiary companies received show cause notices from the Directorate General of GST Intelligence (DGGI), Hyderabad, for alleged short payment of Goods and Services Tax (GST) aggregating to ₹16,822.9 crores for the period July 1, 2017, to March 31, 2022.

Ability Games, owned by accused Suraj Chokhani, was one of the 16 entities used by Mahadev in layering and concealing crime proceeds gene rated through illegal betting operations.

The probe by ED has pegged the proceeds of crime genera ted through illegal betting operations of Sky exchange, an entity linked to Mahadev Online Book scam between September 2020 and February 2024 at 23,916 crores approximately. Additionally, the other linked entity, Lotus365.com, was making around *50 crore per month in cash. The agency has pegged the tentative proceeds of cri- me ₹2,400 crores for a period of 48 months.

In his statement to ED, Manoj Jain, CEO of Delta Corp Ltd which is part of the third charge sheet, has elaborated on the deal with Ability Games. Delta Corp wanted to sell 100% of its casino business in Ne- pal, which was invested through its wholly-owned subsidiary, Caravella Entertainment. Chokhani’s Ability Games was supposed to buy 65% shares of Caravella Entertainment while the balance 35% were to be bought by Ashtek Consultancy, promoter by Ajit Mittal. That, it was agreed that 10 crores will be paid in cash over and above ₹80 crores, which was the enterprise value of Caravella Entertainment,” the statement reviewed by ET reads.

An email sent to Delta Corp remained unanswered until press time.

Earlier this year, the agency had frozen shares worth ₹1,100 crore held in demat accounts linked to the accused in the case. The ED suspects most of these stocks were small and mid-cap stocks.

 ED’s findings come at a time when Sebi chief Madhabi Puri Buch has raised concerns over stretched valuations of small and mid-cap stocks, which are generally favoured by retail investors and have continued to enjoy their patronage thro- ugh monthly purchase mandates to mutual funds built around such investment themes.

The third supplementary charge-sheet has been filed against 23, including 14 entities which are suspected to be conduits used to invest in the share market.

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