2023 (12) TMI 1276 - HC - GST

Betting and gambling - whether the petitioner's platform which is used for gaming would fall within an actionable claim amounting to betting and gambling? - validity of Rule 31A of the CGST Rules, 2017 and Section 15(5) of the CGST Act, 2017 - HELD THAT - In a similar case, the High Court of Gujarat at Ahmedabad in NXGN Sports Interactive Private Limited Versus Union of India 2023 (11) TMI 357 - GUJARAT HIGH COURT has entertained the petitions by granting the interim order. Since the subject matter involved is identical, the petitioner too would be entitled to similar order. Hence, the respondents are directed not to take any coercive action against the petitioner pursuant to the show cause notices. However, the petitioner shall respond to the show cause notices and the proceedings may go on which shall be subject to further orders of this Court. Issue rule nisi.

Summary

Issues Involved:
The issues involved in the judgment include the classification of the petitioner's platform for gaming as an actionable claim related to betting and gambling, the challenge to the validity of Rule 31A of the CGST Rules, 2017, and Section 15(5) of the CGST Act, 2017.

Classification of Petitioner's Platform:
The judgment addresses the contention raised by the respondents regarding the petitioner's gaming platform being categorized as an actionable claim involving betting and gambling. The High Court refers to a similar case in the High Court of Gujarat where interim relief was granted, indicating that the petitioner is entitled to a similar order due to the identical subject matter.

Validity of CGST Rules and Act:
The validity of Rule 31A of the CGST Rules, 2017, and Section 15(5) of the CGST Act, 2017 is challenged in the petition. The Court directs the respondents not to take coercive action against the petitioner based on show cause notices. However, the petitioner is required to respond to the notices, and proceedings may continue, subject to further orders of the Court.

Representation of Respondents:
In the judgment, Shri Sandeep Shukla, Advocate, represents respondent No.1, while Shri B.D. Singh, Deputy Advocate General, represents respondent No.2. The Court issues notice to the remaining respondents and sets a deadline for any replies to be submitted by the next date.

Conclusion:
The High Court of Madhya Pradesh grants relief to the petitioner by directing the respondents not to take coercive action, similar to a previous case in the High Court of Gujarat. The validity of certain GST rules and acts is under challenge, and the petitioner is allowed to respond to show cause notices while the proceedings are to continue, subject to further court orders.