CBIC likely to issue demand notice to Gameskraft

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The Supreme Court a few days earlier took a shocking decision to put a stay on Karnataka High Court’s (HC) judgment of quashing the show-cause notice of Rs 21,000 crore to GamesKraft by the GST department.

With things set in motion again, the Central Board of Indirect Taxes and Customs (CBIC) is very likely to issue a demand notice with a penalty. As per officials, the CBIC is set to step in order to take further calls.

“The assessing commissioner will take a call. The assessing officer will send the tax demand. Why would there be a delay? The only reason it was held back was because of the Karnataka High Court order. The demand notice will be sent now with a penalty,” one of the officials said as per Moneycontrol.

The whole charade started about a year ago. Back in September 2022, the GST Intelligence handed Gameskraft a massive tax notice of Rs 21,000 crore. The officials claimed that the company missed the payment for the period between June 30, 2017, and June 30, 2022.

Gameskraft’s tax notice biggest ever till date

Furthermore, Gameskraft’s services were claimed to be in the nature of online betting and non-issuance of invoices to customers. It was the biggest tax notice to any company till date.

Seeking help, Gameskraft filed a plea in the Karnataka High Court challenging the claims in the show-cause notice. After a long hearing process, Karnataka HC ruled that the games provided by Gameskraft comes under the category of skill games and quashed the show-cause notice.

Supreme Court’s decision opens up the possibility of similar treatment for other skill games platforms. The Chief Justice of India (CJI) has instructed Gameskraft to file its response. Additionally, the CJI also asked the GST department to file a rejoinder to the same.

Group General Counsel at Gameskraft, Joyjyoti Misra in his statement said that he along with other skilled gaming industry associations believe and are confident in the judiciary system and the Supreme Court’s decision.