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Earlier, tax alleged to have been evaded by Gameskraft was totaled to be ₹419 crore, which was increased to ₹5,000 crore, and ultimately to over ₹21,000 crore in July 2022, when the authorities alleged that Gameskraft was indulging in betting and online gambling
Supreme Court on Wednesday stayed the Karnataka High Court’s ruling whereby it had set aside show cause notice issued by the GST department directing online gaming company GamesKraft to deposit dues totaling to INR 21,000 crore.
A bench comprising CJI DY Chandrachud along with Justices JB Pardiwala and Manoj Misra issued notice in the SLP filed by the GST department challenging the High Court's order and directed for a counter affidavit to be filed by Gameskraft in two weeks.
N Venkatraman, Additional Solicitor General drew the court's attention to a decision of a three Judge Bench of the Supreme Court in Skill Lotto Solutions Private Limited vs. Union of India & Ors.
After hearing the ASG's submission, the bench ordered thus,
"Pending further orders, there shall be an ad interim stay of the impugned judgment and order of the Single Judge of the High Court of Karnataka. List the Special Leave Petition on 10 October 2023."
Gameskraft was issued an intimation notice from the GST authorities on September 8 last year, raising a demand of ₹21,000 crore. This notice was challenged before the High Court. A single-judge of Justice SR Krishna Kumar had stayed this notice, observing that there were several contentious issues in the case.
The online gaming company moved the High Court again, stating that despite this stay order, the authorities had illegally and maliciously issued a show-cause notice on the very same day as the High Court’s order for depositing of dues.
Case Title: DIRECTORATE GENERAL OF GOODS AND SERVICES TAX INTELLIGENCE (HQS) & ORS. vs. GAMESKRAFT TECHNOLOGIES PRIVATE LIMITED & ORS.
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