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SC Transfers All Pleas By Gaming Companies Challenging GST Demand Notices To Itself

Inc42 · 1y ago

SC Transfers All Pleas By Gaming Companies Challenging GST Demand Notices To Itself

The Supreme Court has transferred all pending cases related to notices issued to online gaming platforms for GST evasion and underpayment of taxes to itself. This comes after the Centre filed a petition seeking the transfer of all 27 pleas pending before nine high courts to the Supreme Court. Last year, gaming startups including Gameskraft and Dream11 had filed cases challenging these notices. The matter pertains to the imposition of a 28% tax on the full face value of online gaming, which increased tax liabilities for these platforms.

Related News

SC seeks centre’s reply on pleas of Games24x7, head digital works on GST notice

Inc42 · 1y ago

SC seeks centre’s reply on pleas of Games24x7, head digital works on GST notice

The Supreme Court of India has issued notices to the Centre and the GST department in response to pleas by online gaming companies Head Digital Works and Games24x7. The companies are challenging the retrospective imposition of a 28% Goods and Services Tax (GST) on the full value of bets placed, rather than on the gross gaming revenue. The court has asked both parties to respond to the plea within two weeks. The case is expected to be heard in the coming months as the online gaming industry grapples with the challenges imposed by recent GST changes.

GST Battle: Online Gaming Companies' Supreme Court Test

Money Control

Money Control · 1y ago

GST Battle: Online Gaming Companies' Supreme Court Test

Online gaming companies and federations are taking their battle against crippling financial notices related to Goods and Services Tax (GST) to the Supreme Court. They are seeking relief from the financial burden imposed by the GST regulations. The Supreme Court will be hearing their pleas as these companies face a significant challenge in dealing with the GST matter.

SC refuses interim relief to Games 24x7 & Head Digital Works on tax notices

Inc42 · 1y ago

SC refuses interim relief to Games 24x7 & Head Digital Works on tax notices

The Supreme Court has denied interim relief to e-gaming companies Games24x7 and Head Digital Works, regarding Goods and Services Tax (GST) demand notices. The court will consider the constitutional validity of imposing a 28% GST on the full value of bets placed in online games, instead of the gross gaming revenue. The online gaming industry in India is also facing other challenges, with platforms like Quizzy, OWN, and Fantok temporarily suspending operations due to changing tax and regulatory conditions. Show-cause notices for suspected tax evasion have also been issued to several companies.

28% GST On Gaming: SC Schedules Final Hearing On July 25

Inc42 · 1m ago

28% GST On Gaming: SC Schedules Final Hearing On July 25

The Supreme Court of India will hold a final hearing on July 25 concerning GST evasion allegations totalling INR 1.12 Lakh Cr against online gaming companies. These companies argue that the 28% GST on real money games is flawed and lacks legal basis since Rule 31A of the GST Rules did not comply with mandatory processes. The gaming platforms claim retrospective GST notices and unclear provisions violate tax principles, seeking revocation of these notices.

SC stays GST notices worth over Rs 1 L Cr against online gaming firms for tax fraud

YourStory

YourStory · 7m ago

SC stays GST notices worth over Rs 1 L Cr against online gaming firms for tax fraud

The Supreme Court has stayed GST authorities' showcause notices, valued at over Rs 1 lakh crore, against online gaming firms over alleged tax evasion. Justices J B Pardiwala and R Mahadevan ruled that all proceedings against these companies remain paused, pending further hearing. The GST law was amended in October 2023 to require foreign online gaming firms to register in India, with a 28% GST on bets. Various firms challenged these demands, and the Supreme Court consolidated cases for review.

Multiple companies got GST notices this new year.

Livemint

Livemint · 1y ago

Multiple companies got GST notices this new year.

The Goods and Services Tax (GST) department has issued demand notices to several large companies, including the Life Insurance Corporation of India (LIC) and Hindustan Unilever, for pending GST dues and penalties. These notices have caused concern in the corporate world, impacting mergers and acquisitions as companies need to account for tax liabilities. The insurance and gaming industries have also received significant bills from the GST department. The surge in notices is attributed to a backlog of tax demands caused by relaxations during the COVID-19 pandemic.

Online Gaming GST Row: SC Stays ₹5,712-Crore Demand Against Paytm’s First Games

OutlookIndia

OutlookIndia · 3m ago

Online Gaming GST Row: SC Stays ₹5,712-Crore Demand Against Paytm’s First Games

The Supreme Court has stayed a ₹5,712-crore GST demand against Paytm's First Games, a real-money gaming platform. This dispute involves the classification and taxation of real-money gambling platforms under GST, impacting the broader online gaming industry. First Games challenged a retrospective GST notice, seeking relief on the GST rate applied to platform fees versus total bets. The issue highlights ongoing controversies about GST categorization and taxation in the Indian online gaming sector.

Govt serves online gaming companies tax notices worth Rs 1 lakh crore

Economic Times

Economic Times · 1y ago

Govt serves online gaming companies tax notices worth Rs 1 lakh crore

The Indian government has issued show cause notices worth Rs 1 lakh crore ($13.4 billion) to online gaming companies for tax evasion, according to a senior official. The notices are part of efforts to crack down on tax evasion in the gaming industry. From October 1, foreign gaming companies are required to register in India under the amended GST law. The notices have been served to companies like Dream11, Delta Corp, and GamesKraft.

Paytm gets relief as Supreme Court stays Rs 5,712 Cr GST notice

Entrackr

Entrackr · 3m ago

Paytm gets relief as Supreme Court stays Rs 5,712 Cr GST notice

Paytm gets relief as Supreme Court stays Rs 5,712 Cr GST notice. In its order, the apex court directed, “Further proceedings of all the impugned show cause notices shall remain stayed till the final disposal of the main matter along with all the matters which are tagged.” The Supreme Court of India has stayed the proceedings of a Rs 5,712 crore GST Show Cause Notice (SCN) issued to First Games Technology Private Limited, a subsidiary of One 97 Communications Ltd (Paytm). Paytm shared the update in a regulatory filing on May 24, after the Supreme Court issued an interim order on May 23. The order came in response to a petition by First Games, which challenged a GST notice from the Directorate General of GST Intelligence (DGGI) for the period from January 2018 to March 2023. In its order, the apex court directed, “Further proceedings of all the impugned show cause notices shall remain stayed till the final disposal of the main matter along with all the matters which are tagged.” The stay gives Paytm’s gaming arm temporary legal relief and more time to defend its case without facing immediate penalties. Earlier, Paytm said the notice is part of an ongoing issue in the online gaming industry. The disagreement is about GST being charged at 28% on the full entry amount, while gaming companies believe it should be 18% only on their actual earnings from platform fees. The SCN is part of a broader industry-wide probe by the GST department, which has issued similar notices to several gaming companies. The matter is being closely monitored by stakeholders across the online gaming sector. Paytm's operating revenue fell by 16% year-on-year to Rs 1,911 crore in the fourth quarter of FY25, down from 2,267 crore in the same quarter of FY24. However, the Noida-based company narrowed its losses to 23 crore in Q4 FY25, a 96% reduction from 536 crore in Q4 FY24.

Dream11 withdraws plea challenging Rs1,200 cr tax notice

Livemint

Livemint · 1y ago

Dream11 withdraws plea challenging Rs1,200 cr tax notice

Fantasy sports company Dream11 has withdrawn its petition challenging notices of alleged tax evasion amounting to ₹1,200 crore in the Bombay High Court. The state goods and services tax (GST) authority had withdrawn its show cause notice on Dream11 as the Central GST authorities were pursuing the matter in the Supreme Court. The gaming company was asked to pay a 28% tax on its gross value, with the company arguing that online fantasy sports gaming predominantly involves skill and not gambling.

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