My question is has anyone of you been in such situation before? And how were you able to handle such situation?
However, if I were this guy, the first thing to do is to take up the issue with them and threaten them with their regulator (if any), but if this is not helping, I think heading to court is the solution. You should pray to the court to collect your winning for you, get damages for you, and also make them pay all the legal fees you used to secure justice in this case so that you will lose nothing. Upon seeing your seriousness, they might want to settle it out of court and you will get your money. And since this is a local betting, it will be easier.
Also, it is good for gamblers to have their record often screenshots or screen-videoed at times so that they at least have some proof to tender in a case like this. Let all your betting tickets have self-records especially when you know you are expecting to win a big amount of money.