GST crackdown! DGGI blocks 357 offshore e-gaming sites to curb tax evasion ahead of IPL 2025

Goods and services tax (GST) intelligence officers have blocked 357 websites of illegal offshore online gaming firms and attached about 2,400 bank accounts. The Finance Ministry said on Saturday, March 22, that about 700 offshore e-gaming companies are under the Directorate General of Goods and Services Tax Intelligence (DGGI) scanner for evading GST by failing to register, concealing taxable pay-ins, and bypassing tax obligations.

The finance ministry cautioned the public against engaging with offshore gaming platforms, even though many Bollywood celebrities and cricketers, besides social media influencers, are found to be endorsing these platforms.

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Investigations also revealed that these offshore companies operated through some 'mule' bank accounts to process transactions, the ministry said, adding the DGGI blocked 166 'mule' accounts. "So far, 357 websites/URLs of illegal/non-compliant offshore online money gaming entities have been blocked by the DGGI, in coordination with the Ministry of Electronics and Information Technology (MeitY)," the finance ministry said in a statement.

In two separate cases, DGGI collectively blocked 2,400 bank accounts and put a freeze on nearly ₹126 crore. In another operation, online money gaming platforms outside India were found to be conning Indian customers. They were using mule bank accounts to collect money from customers in India.

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The investigation revealed that these individuals facilitated online money gaming to Indian customers through various illicit online platforms, including Satguru Online Money Gaming Platform, Mahakaal Online Money Gaming Platform, and Abhi247 Online Money Gaming Platform.

DGGI has blocked 166 mule accounts linked to these platforms so far. Three such persons have been arrested, and an investigation against more such individuals is underway. Under GST law, 'Online Money Gaming', being an actionable claim, is classified as a supply of 'Goods' and is subject to a 28 per cent tax.

Entities operating in the sector are required to register under the GST. The ministry said that with the upcoming IPL season, enforcement actions by tax officers will be more stringent in curbing illicit gaming operations. It urged people to engage with regulated e-gaming platforms. “Non-compliance by foreign entities distorts fair competition, harms local businesses, and skews the market.”

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The unscrupulous foreign entities circumvent restrictions by creating new web addresses. "Investigations also revealed that these companies operated through 'mule' bank accounts to process transactions. Funds collected through mule accounts leave the potential to enter illicit activities, which may be dangerous for the national security point of view," said the ministry.

The ministry further said, "It has been observed that many Bollywood celebrities and cricketers, along with YouTube, WhatsApp, and Instagram influencers, are found endorsing these platforms, and therefore, the public is advised to remain cautious and not engage with offshore online money gaming platforms as it may jeopardise their personal finances and indirectly support activities that undermine financial integrity and national security".