The Central Government has filed the Special Leave Petition before the Supreme Court against the ruling of the Karnataka High Court in the Gameskraft case on August 1st 2023. The same was confirmed by the Revenue Secretary Sanjay Malhotra in the press meet of the Goods and Services Tax (GST) Council meeting held on 2nd August 2023.
Also read: 51st GST Council Meeting: Key Highlights
According to the reports, the Supreme Court will hear the SLP in the next 3 or 4 days.
Gameskraft is a Karnataka based online gaming platform, received a notice from the Directorate general of Goods and Services Tax (GST) Intelligence raising demand of Rs. 21,000 crores, was challenged before the High Court of Karnataka. As per reports, the GST intelligence has claimed that the platform is used for gambling.
In the case, a Single Bench of Justice S. R. Krishna Kumar quashed the impugned GST Show-Cause Notice (SCN) against the petitioner Gameskraft which had imposed Rs. 21,000 Crore at 28% GST on online gaming services provided to gamers.
Gameskraft, in its plea to the Karnataka HC, claimed that it had already paid over Rs 1,500 crore in GST and the tax department was not differentiating between games of skill and chance.
Read More: GST on Online Gaming: Karnataka HC quashes SCN of Rs. 21000 Crores against Gameskraft
The finance Minister Nirmala Sitharaman has confirmed the taxation rate of online gaming as 28%. The amendments will be implemented on 1st October 2023 which will be subject to review after 6 months implementation.
The Revenue Secretary stated that the notifications or amendments are prospective in nature and not retrospective. Thus, the applicability of the same on the decision of the Gamekraft is left to the apex court.
The main topics discussed during the 51st Council meeting included the implementation of decisions made in the previous meeting regarding online gaming and the enabling provisions in the GST law, as well as the subsequent implementation of these decisions by the states.
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