Landmark Ruling: Skill Gaming Platform Wins Partial Relief with 50% Fund Defreezement and Business Continuity Protection

SC partially ruled in favor of the petitioner in a GST dispute involving skill gaming platform. The court directed defreezement of 50% of attached funds (Rs. 97.95 crore), allowing continued business operations. No coercive recovery steps would be taken pending further proceedings, with the matter adjourned to resolve taxation classification of skill games and platform fees.

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Issues involved:
The issues involved in the judgment are related to the taxation of skill games facilitated by the petitioner, specifically whether they should be charged as a game of chance at 28% on the entire bet value, and the payment of GST on platform fees.

Taxation of Skill Games:
The petitioner's counsel highlighted that no clarification has been provided by the Group of Ministers regarding whether the skill games facilitated by the petitioner should be taxed as a game of chance at 28% on the entire bet value. The petitioner had already paid GST at 18% on platform fees. The court noted that no coercive steps would be taken for recovery of the amount demanded as per the show cause notice, similar to the assurance given in a previous judgment. It was ordered that 50% of the attached amount should be defreezed to allow the petitioner to continue its daily operations.

GST Payment Dispute:
The petitioner's counsel contested that 18% GST had been paid on the total turnover of approximately Rs. 86 crore over two years, with an attachment made of around Rs. 97.95 crore. The court considered the previous order where it was stated that no coercive steps would be taken against the petitioner, and directed that 50% of the attached amount should be defreezed to enable the petitioner to carry out its regular business activities. The matter was adjourned to 17.08.2023 for further proceedings.

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