Rank Group, the gaming firm that operates Mecca Bingo and Grosvenor casinos, has won a legal battle with Her Majesty’s Revenue & Customs (HMRC).

The VAT & Duties Tribunal ruled that charging VAT on interval bingo games was against European law and therefore that Rank could claim overpaid VAT of £36.3m.

Interval games – also called mechanised cash bingo or cashline – are played in between the main bingo games. The ruling has opened the door for other bingo operators to claim tax rebates back form HMRC.

Tony McClenaghan, head of indirect tax at Deloitte, which advised Rank, said: “This decision upholds the principles set out by the European Court of Justice in the Linnewebber case. The same principles will apply to any taxpayer, which has paid VAT on this type of bingo.

“It’s a case of eyes down for other taxpayers to consider if they have claims to submit for overpaid VAT and interest to HMRC.”

The news will come us a boost to the troubled industry, which has been left reeling from the effects of the smoking ban.

HMRC has until 10th July 2008 to appeal the tribunal’s decision. Should it decide to appeal, it is unlikely that there will be any material benefit to Rank in the current year.