Sporta Technologies, parent company of online fantasy sports gaming platform Dream11, has moved the Bombay High Court challenging a massive INR 40,000 Crore goods and services tax (GST) evasion claim made by tax authorities.
Dream11 joins a growing list of gaming platforms taking legal recourse against the tax authorities over alleged GST evasion.
The Rs 40,000 crore claim against Dream11 sets a dubious new record for indirect taxation claims in India. This staggering figure surpasses the previous high set by the Rs 21,000 crore notice served to Gameskraft, also a gaming platform.
Dream11 has cemented its position as the dominant player in the Indian fantasy gaming arena, boasting the highest valuation and the largest user base in the country. With a valuation exceeding $8 billion, the platform has successfully attracted over 180 million users to its sports fantasy platform.
The Economic Times reported that several gaming companies have received pre-show cause notices recently. demanding a total payment of over Rs 55,000 crore in GST. Some of these companies have already initiated or are considering legal measures to address this issue.
The significant impact of this tax demand on the online gaming sector has been a major concern of entities in the industry since it was introduced.
Legal discussions within gaming companies indicate that their primary focus is on contesting the retrospective application of GST on their revenues, dating back to July when the GST Council decided to impose a 28 per cent tax on the full-face value, as reported by ET on September 27.
