Supreme Court upholds imposition of GST on lotteries, betting and gambling

The apex court bench headed by Justice Ashok Bhushan upheld the notification issued under the Central Goods and Services Tax Act, 2017 wherein the lottery and gambling have been brought under the GST

Japnam Bindra
Updated3 Dec 2020
Supreme Court.
Supreme Court.(Reuters)

The Supreme court on Thursday upheld that the Goods and Service Tax (GST) shall be imposed on the sale of lotteries, betting and gambling.

The apex court bench headed by Justice Ashok Bhushan upheld the notification issued under the Central Goods and Services Tax Act, 2017 wherein the lottery and gambling have been brought under the GST.

The bench also comprising Justices R Subhash Reddy and MR Shah dismissed the plea filed by Skill Loto solutions which sought to declare the levy of GST on lottery as discriminatory and in violation to the provisions of the constitution of India.

The order was passed in a batch of pleas filed by various lottery dealers including Skill Lotto Solution, a lottery dealer, which argued that Central government had wrongfully classified lottery as “goods”.

The plea added that the lottery are pieces of paper and devoid of any value.

The 87 page judgment the top court was reserved on 4 November after an extensive hearing by a three judge bench.

The petitioners highlighted the alleged discriminatory practice wherein there is an imposition of 12% GST on lotteries sold within the same State and 28% GST for sale of tickets from other States.

The judgment observed in details, “When Act, 2017 defines the goods to include actionable claims and included only three categories of actionable claims, i.e., lottery, betting and gambling for purposes of levy of GST, it cannot be said that there was no rationale for including these three actionable claims for tax purposes. Regulation including taxation in one or other form on the activities namely lottery, betting and gambling has been in existence since last several decades.

When the parliament has included above three for purpose of imposing GST and not taxed other actionable claims, it cannot be said that there is no rationale or reason for taxing above three and leaving others.”

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