In a case that could redefine the taxation of India’s booming online real money gaming (RMG) industry, the Supreme Court has fixed 25 July 2025, as the final hearing date in a high-profile legal battle over the applicability of 28 percent Goods and Services Tax (GST) on online gaming platforms. With an estimated financial impact of ₹2.5 lakh crore ($3 billion), the matter has become one of the most significant tax cases in Indian history.
Final hearing date set in gaming GST case
A Division Bench of the Supreme Court, comprising Justices J.B. Pardiwala and R. Mahadevan, confirmed on Tuesday that arguments from the petitioners of online gaming firms, 바카라s, and lottery operators would be heard until 17 July. The union government will present its rejoinder arguments starting 18 July, with the Bench reserving its judgment on 25 July, which will also mark the conclusion of the hearings.
“This is a long list of petitioners; this will be a never-ending saga,” Justice Pardiwala remarked, reacting to the extensive number of industry players involved. He directed that the court proceed efficiently to hear all arguments within the scheduled window.
Industry challenges GST on entry fees
At the core of the dispute is the government’s interpretation of Rule 31A of the Central GST Rules, which mandates a 28 percent tax on the face value of each bet. The gaming firms argue that this rule should apply only to games of chance such as betting and gambling, not to games of skill like poker, rummy, and fantasy sports.
Senior Advocate Harish Salve, representing the RMG companies, questioned whether participation fees in online games can be classified as “actionable claims” and therefore taxed as goods. He cited the 2006 Supreme Court judgment in Sunrise Associates, arguing that there is no actionable claim in games of skill and that the platforms only act as facilitators and not sellers of a taxable product.
Salve added that the current tax notices and GST circulars mischaracterise the nature of these platforms. He contended that the attempt to tax skill-based games as gambling is inconsistent with the Constitution, especially after the 101st Constitutional Amendment, which limits states’ authority to tax gambling under .
As for the retrospective tax demands, corporate lawyer Divya Sharma told SiGMA News that this was troublesome. “The valuation method adopted by the tax authorities is unreasonable,” Sharma said.
“The full-face value of bets does not belong to gaming companies but is redistributed among players. Additionally, the imposition of a 28 percent GST disregards the historical distinction between games of skill and games of chance, which has long guided regulatory frameworks.”
– Divya Sharma, corporate lawyer
Sharma identified key legal challenges for gaming firms, including contesting the retrospective application of the tax and reasserting constitutional protections for skill-based games.
Government stands firm
Representing the union government, Additional Solicitor General (ASG) N. Venkatraman defended the GST notices, stating that the defining factor of gambling is not the type of game, but the financial stake involved. Before the court’s summer recess, Venkatraman laid out seven core principles, referred to as the “seven sutras of gambling” to underline the legal framework around online wagering.
The government has maintained that games involving monetary stakes fall within the definition of gambling and should be taxed accordingly under the GST regime.
Verdict that could reshape the online gaming landscape
The upcoming verdict holds critical implications for India’s online gaming ecosystem, which has seen rapid growth in recent years. Industry stakeholders argue that a decision in their favour could reinforce the legal distinction between games of skill and games of chance, boost investor confidence, and provide clarity for future regulation.
At stake are not only the pending tax demands but also the broader regulatory future of the digital gaming and entertainment sector in India. The ruling is expected to serve as a precedent for how similar platforms are taxed and classified going forward.
