Supreme Court Stays GST Showcause Notices Against Online Gaming Companies

The Supreme Court on Friday stayed the showcause notices issued by GST authorities to online gaming companies and casinos over alleged tax evasion.

A bench of Justice J B Pardiwala and Justice R Mahadevan passed the interim order while posting the matters on March 18.  Additional Solicitor General N Venkataraman, for the Union, said some show-cause notices were to expire in February.

Last year, the Supreme Court had transferred to itself petitions pending in High Courts challenging the imposition of 28% Goods and Services Tax (GST) on online gaming companies.

In a brief hearing held in January 2024, Senior Advocate Harish Salve, for the online gaming companies, argued that there is no supply of 'actionable claim' to impose GST on the 100% of the face value of the bet or the amount paid into the totalisator.

In the Gameskraft matter, the Supreme Court had stayed the Karnataka High Court's judgment which had quashed the GST Intimation Notice to the tune of Rs 21,000 crore issued to the the gaming company.

Case : Directorate General of Goods and Services Tax Intelligence (HQS) and Ors v. Gameskraft Technologies Pvt Ltd SLP(C) No. 19366-19369/2023 and connected cases