Prateek Tanmay
2 min readMay 28, 2026 01:43 AM IST
In a major ruling, the Supreme Court Wednesday upheld the decision of Goods and Services Tax (GST) authorities to demand 28% retrospective tax on online gaming.
A bench of Justices J.B. Pardiwala and R. Mahadevan said “online gaming activities, including fantasy sports and other games played on digital platforms, involving staking upon uncertain outcomes, constitute betting and gambling for the purpose of GST framework”.
The court held that GST levy on online gaming is constitutionally valid.
“GST of the supply of actionable claims arising from betting and gambling is constitutionally valid and does not transgress Articles 366(12) (which defines goods) and 366(12A) (which defines GST) of the Constitution,” the bench said. The top court was hearing an appeal by the Directorate General of Goods and Services Tax Intelligence (Headquarters) challenging a Karnataka High Court judgement which quashed the GST department’s show cause notice issued under the CGST Act to online gaming company GamesKrraft Technologies Pvt Ltd seeking payment of Rs 21,000 crores dues.
The Supreme Court had stayed the High Court decision in May 2023.
The proceedings before the High Court dealt with whether online games under the platform would be considered games of skill which attracts 19% GST or one of chance in which case 28% GST would apply.
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