2 Feb 2020 Jonas Lemberg

SC Dismisses Gurdeep Sachar’s Clarification Application in Dream11 GST matte

SC brings finality on legality of fantasy sports in India

A Supreme Court bench of Justices Rohinton F. Nariman and S. Ravindra Bhat on Friday dismissed a clarification application filed by advocate Gurdeep Singh Sachar, which had urged the apex court to allow the issue of whether the fantasy games offered by Dream11 amounts to gambling/betting can be reviewed in the Bombay High Court for the purposes of determining whether there is any GST evasion on Dream11’s part.

Sachar’s counsel, senior advocate Mahabir Singh, contended that the application for clarification be allowed as the issue of gambling/betting is connected to determination of the manner of payment of GST, while former Attorney General of India and Senior Counsel Mukul Rohatgi, appearing for Dream11 strongly opposed the application.

Senior Advocate K. Radhakrishnan appeared on behalf of the central government.

The Supreme Court bench while dismissing Sachar’s interlocutory application, noted, ‘It is reiterated that in accordance with our order dated 13.12.2019, the only scope of the review filed in the Bombay High Court is with respect to GST and not to revisit the issue as to whether gambling is or is not involved.’

Sachar had originally filed a PIL in the Bombay High Court in April 2019 alleging that Dream11 conducts gambling operations and wrongly pays Goods and Services Tax (GST) only at the rate of 18% on the margin retained by the company, instead of 28% on the face value of bets under Rule 31A of the Central Goods and Service Tax Rules, 2017.

A division bench of the Bombay High Court comprising of Justices Ranjit More and Bharati Dangre had dismissed Sachar’s petition and ruled in Dream11’s favour on 30th April, 2019.

Sachar as well as the Union of India, State of Maharashtra and activists Varun Gumber and Avinash Mehtrotra had filed appeals/applications against the order of the Bombay High Court.

However, through separate orders, the Supreme Court dismissed Gumber’s petition as well as the central government, Sachar and Mehrotra’s pleas.

While jointly dismissing the central government, Sachar and Mehrotra’s pleas on 13th December, the Supreme Court bench comprising of Justices Nariman and Bhat had allowed the Union of India to file a Review Petition before the Bombay High Court on the limited issue of GST evasion by Dream11 within four weeks.

The central government’s review petition came up for hearing on 28th January, but its contentions on the GST issue did not find much favour with the bench comprising of Justices Ranjit More and SP Tavade.

The matter is now scheduled to come up for hearing on 11th February, 2020, with the Additional Solicitor General of India expected to lead submissions on behalf of the central government.

Importantly however, with the Supreme Court’s dismissal of Sachar’s application and its categorical assertion in the order that the issue of gambling with respect to Dream11 cannot be revisited, there remains little doubt about the legality of fantasy sports in India.

Share article

MPL Poker promo