Gujarat High Court Halts Show Cause Notice To Vision11 And Twelfth Man Fantasy Amidst Gambling Allegations
Gujarat High Court's recent decision pauses a legal tussle over gaming platforms.
The Gujarat High Court issued an order on Friday, to halt a show cause notice sent to the fantasy sports operator Vision11 and the company Twelfth Man Fantasy. The tax department is claiming that the services offered by Vision11 are akin to betting and gambling.
The bench that stayed the show cause notice comprised Justices Biren Vaishnaw and Mauna Bhatt.
Twelfth Man Fantasy, also a party to the case has challenged the constitutionality of Rule 31A of the CGST (Central Goods and Services Tax) Rules.
The rule deals with the Value of supply in the case of lottery, betting, gambling, and horse racing.
In simpler terms, this section makes it a requirement for anyone selling goods or services to provide a bill or an invoice for each sale they make. It's necessary for the person selling these goods or services to give their customers an invoice as proof of the transaction. This helps keep track of sales and ensures transparency in business transactions.
The companies raised several arguments, including the claim that the rule is arbitrary and exceeds the authority given by the law.
According to the show cause notice issued by the tax department, Vision11 has been accused of operating an online betting platform. Additionally, the tax department has suggested that GST (Goods and Services Tax) should be imposed on the total value of bets placed on the platform.
After listening to the arguments from both sides, the Gujarat High Court decided to temporarily stop any further legal processes related to the case. The court has scheduled the matter to be reevaluated on Jan 17, 2024.
