Punjab & Haryana High Court Impedes Coercive Actions Against Online Opinion Betting App In Respect Of Rs. 1500 Crore GST Notice

The Punjab and Haryana High Court impeded coercive actions against the online opinion betting app, Probo Media Technologies, in respect of the GST Notice demanding Rs. 1500 crore.

The bench of Justice Ritu Bahri and Justice Manisha Batra has stated that no coercive steps for the recovery of the amount demanded in the show cause notice shall be taken and further ordered that 50% of the amount present in the attached account be released.

The petitioner company is an online intermediary or marketplace that owns and manages a mobile gaming application as well as a web-based gaming portal named "Probo". It facilitates adult players to trade their skill, knowledge, experience, or analysis-based opinions on sporting and non-sporting events with other users or players and charges a service fee for such facilitation services.

The Haryana GST Intelligence Unit had issued a show cause notice under Section 74 of the Act on Goods and Services Tax amounting to INR 15,00,89,32,218 along with interest and penalty under the provisions of the GST Act. The company's bank accounts were also provisionally attached and frozen.

The petitioner relied on the judgment passed by the Punjab and Haryana High Court in the case of Witzeal Technologies Pvt. Ltd. vs. Union of India and Ors., where, on a statement given by the State Counsel, the matter was disposed of keeping in view the assurance that the empowered Group of Ministers was investigating the matter and they would take necessary steps only when clarification came.

The petitioner contended that to date no clarification has been given by the Group of Ministers, who are examining the issue on the question of whether the skill games that are being facilitated by the petitioner are to be charged as a game of chance at 28% on the entire bet value.

The petitioner stated that on platform fees, they have already paid 18% GST.

The court, while taking into account a previous order in which the state government had suffered a statement that clarification on taxation is a pending decision with the empowered group of ministers, directed that no coercive actions must be taken.

Case Title: Probo Media Technologies Versus Union of India

Case No.: CWP-11446-2023

Date: 25/05/2023

Counsel For Petitioner: Tarun Gulati, Rana Gurtej Singh, Sudipta Bhattacharjee

Counsel For Respondent: Rishabh Kapoor

Click Here To Read The Order