Desk of CA. Praveen Sharma – 1043 Series (CAPS) 

Supreme Court  IN THE CASE OF Directorate General of GST Intelligence (HQ) & Ors. v. Gameskraft Technologies Pvt. Ltd. & Ors.

Supreme Court Upholds 28% GST on Online Gaming

In a landmark judgment, the Supreme Court has upheld the constitutional validity of 28% GST on online gaming involving real-money stakes, including betting, gambling, and casino-style transactions. The Court ruled that online gaming platforms are not merely intermediaries but suppliers of taxable actionable claims under the GST law.

The Court also clarified that GST is payable on the entire amount staked or deposited by players, and not just on the platform fee or Gross Gaming Revenue (GGR). It further held that the 2023 amendments to the GST law are clarificatory and apply to pending disputes as well.

As a result, the Karnataka High Court's earlier Gameskraft judgment was set aside, and retrospective GST demands exceeding ?1.5 lakh crore raised by the DGGI were upheld.

Following the ruling, several online gaming companies have filed review petitions before the Supreme Court, arguing that the judgment contains legal errors, particularly regarding retrospective taxation. However, the original judgment remains valid and enforceable, as no stay has been granted on its operation.

LINK:Desk of CA. Praveen Sharma GST

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