Online gambling and casinos are the fastest-growing betting platforms, and millions worldwide use them to explore thrilling actions and profitable outcomes. The latest data reveals that online gaming and casino retrospective GST cases listed in SC today involve payments of thousands of crores calculated at 28 percent of the bet’s face value.
This official notification was taken to the Supreme Court, which listed GamesKraft and a batch of matters today before the 3 judges’ bench headed by DY Chandrachud, judge of the Chief Justice of India. Here, the hearing on Friday finalises that the batch of cases will be listed after the summer vacation in July 2024, when the court opens.
Further, tomorrow’s listing is to take directions from the bench on the procedural aspects, where matters may be heard for a few minutes. The Supreme Court currently holds a cluster of 30 petitions from online real-money gaming firms.
In April, it transferred to itself 27 writ petitions where the decision is pending across 9 different state high courts. Also, they are challenging the levy of 28% GST on all forms of online real-money gaming with a retrospective effect.
What Decisions Were Made By The Supreme Court Of India?
The same announcement was made in December 2023, when the apex court declined to halt these notices but agreed to hear the plea. These gaming firms face 71 show-cause notices for GST evasion of Rs 1.12 lakh crore in 2022-23, excluding interest and penalties.
Here, the penalty of 100% of tax demand, which could surpass 2.4 crore, including interest, would be charged under Section 74. Moreover, earlier data reveals that on October 1, 2023, a 28 percent GST was levied on the full face value of online gaming bets by the GST Council, where review was taken after 6 months.
The Supreme Court also sought a response from the Director General of goods and services tax, where petitioners were Dream 11, Games 24/7, and Head Digital Work. It is said that in September last year, a supreme court imposed a stay of operations of Karnataka high court order where GST filed officers notices Rs. 1.12 lakh crore to online gaming companies for alleged tax evasions and facing legal challenges.
Earlier, the Karnataka high court squashed a GST notification of Rs 21,000 crore on hold due to online, electronic, or digital rummy played on Gameskraft not being taxable as a betting or gambling industry.
After meeting in July and August 2023, it was recommended that online gambling and casinos, along with horse racing, be charged 28% on full face value without differentiating games of skills from games of chance. This became effective in October 2023, and currently, the prospective application is not being challenged.
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