Rajasthan High court dismisses the petition filed against Dream 11, accusing the corporate of betting and gambling

The Rajasthan high court on Friday (16 October) dismissed the writ petition of the character of public interest litigation against Dream 11 Fantasy Private Limited. The petition alleged that the sport being played on this platform was nothing but “betting”. The petition alleged that online fantasy sports games are coincidental games, thus making it an illegal act of gambling/betting.

A division bench of judge Inderjit Mahanti and Justice Mahendra Kumar Goel stated that “Since the result of a fantasy game depends on the skill of the participant, not on coincidence and therefore the victory or defeat of the virtual team created by the participant is additionally a real-world game or event. Independent of the results of, we believe that the shape of the web fantasy game proposed by respondent No. 5 is just a game of skill and their occupation is protected under Article 19 (1) (g) of the Constitution of India, as varied as it’s repeatedly stated by the courts and affirmed by the Honorable High Court. ”

What was said within the PIL it had been alleged that private-respondent No.5 isn’t paying GST under the right classification, which should be at the speed of 28% and pays only 18% GST, also on the quantity received from a participant, Which he retains, which is effectively like saving GST on the remaining 80% amount, which is transferred towards the winning amount for the sport. The petitioner mentioned Section 65-B (15) of the Finance Act, 1994 for the definition of “betting or gambling”, Section 2 (13) of the CGST Act, and Rule 31-A for the definition of “consideration” and central goods and repair Tax Rules, 2018 ( abbreviated ‘CGST Rules’).

The petitioner mentioned circular No. 27/01/2018-GST dated 04.01.2018 issued in reference to racing and alleged on the idea that GST should be payable at 100% of the quantity received. Consistent with the petitioner, out of each `100 / – received from the participants by private respondent number 5,` 80 / – is about aside in an escrow account of the common pool price value and therefore the same is distributed among the winners and GST isn’t paid on this amount, which is paid on the balance retained as platform fee i.e. `20 /-. The petitioner also alleged that even on the said actionable claim amount of Rs.80 /- held within the escrow account and distributed among the winners, GST should be payable by private respondent No.5 at the speed of 28% Must tend.

dismissed PIL against Dream 11

The petition involves action against private respondent No. 5- Dream 11 by raising two issues, which are as follows: (1) Are the proposed online fantasy sports “gambling/betting” on the Dream 11 platform? (2) whether the Respondent No. 5-Dream 11 is assessed within the wrong entry to games virtual online GST, and so, to save lots of the GST CGST Rules 2018, the Rule 31 (A) (3) being violated is? Court analysis

Bombay State RMD Chamarabagala, citing the High Court ruling in AIR 1957 SC 699, stating that skill games are breakaway gambling and protection under Article 19 (1) (g) of the Constitution of India The high court held that sports which involve adequate skills aren’t gambling and such competitions are protected under Article 19 (1) (g) of the Constitution of India as professional activities.

dismissed PIL against Dream 11

Furthermore, the court concluded that the fantasy game proposed by defendant No. 5 isn’t determined by coincidence or accident, but by the skill of the participant determining the result of the sport. The court said that which team wins or loses in actual matches isn’t important, because the participant includes players from both teams playing within the world within the selection of the virtual team. The Court also agreed with defendants No. 5’s presentation that fictional game formats like Dream-11 are recognized worldwide as recreational sports devices, as they permit sports lovers, alongside their family and friends, to play their favorite games Provide a platform to attach with. Legitimate commercial activity protected under Article 19 (1) (g) of the Constitution results in an increase in GST and tax payments and also entertains spectators and sports fans.

The court finally stated that the sport played on the platform of defendant No. 5 isn’t fictitious gambling or betting. On the second issue, the Court held Gurdeep Singh Sachar v. Union of India [Decision Criminal PIL on 30 April 2019. Cited number 16 of 2019]. However, the Court found it appropriate for GST officers to go away the said second issue for consideration as per law. The Court was of the view that the PIL was filed with none real public interest, without disclosing the relevant facts, and without proper research. Consequently, the Court found no merit within the PIL and accordingly was dismissed with costs.