New GST Directive Sets 30-Day Time Limit for E-Invoice Filing

The GST Authority has decided to set a 30-day time limit for invoice reporting on the Invoice Registration Portal (IRP) for taxpayers with Aggregate Annual Turnover (AATO) greater than or equal to Rs. 100 Crores. This limit will apply from the date of the invoice.

The decision to impose such a restriction has been taken with the aim to enhance compliance with GST regulations and streamline the reporting process. The advisory issued by the National Informatics Centre states that the restriction will apply to all document types requiring Invoice Reference Numbers (IRNs). This includes invoices, credit notes, and debit notes. For example, if an invoice is dated November 1, 2023, it must be reported no later than November 30, 2023.

This GST directive which will come into force w.e.f. November 1, 2023, is in supersession of the previous advisory dated April 17, 2023, through which the Centre informed of the Government’s decision to impose a 7-day time limit.


SC Stays Order Quashing GST Notice Against Gameskraft

Recently, the Supreme Court issued a stay on the Karnataka High Court’s judgment setting aside the GST show cause notice issued against the online gaming company, M/s. Gameskraft Technologies Private Limited.[1]

The said notice was issued on September 23, 2022, to Gameskraft for failing to make payment of tax to the tune of Rs. 21,000 Crore with respect to online rummy games played on its platforms. Holding that such games are “substantially and preponderantly” games of skill and not of chance, the Karnataka High Court dismissed the argument that they were taxable as ‘Betting’ and ‘Gambling’. The court proceeded to set aside this show cause notice in May 2023, deeming the same to be “illegal, arbitrary and without jurisdiction or authority of law”.

The present special leave petitions have been filed challenging the said decision of the Karnataka High Court. One of the paragraphs of the said judgment wherein the tax authorities were reprimanded for their attempt to “cherry pick stray sentences” from Court judgments and “try to build up a non-existent case out of nothing which clearly amounts to splitting hairs and clutching at straws” has been flagged. Further, the petitioners cited the Apex Court’s decision in Skill Lotto Solutions Private Limited v. Union of India & Ors.[2] in support of their contentions.

The matter will be heard next on October 10, 2023.

[1] Directorate General of Goods and Services Tax Intelligence (HQS) & Ors. v. Gameskraft Technologies Private Limited & Ors. [SLP(C) Nos. 19366-19369/2023]

[2] (2021) 15 SCC 667


28% Tax on Online Gaming: GST Amendment Bills Receive President’s Assent

On August 18, 2023, the GST Amendment Bills, levying a tax of 28% on the full face value of bets in online gaming, casinos and horse race clubs, received the assent of the Hon’ble President, Draupadi Murmu. The said Bills were introduced and passed by the Parliament on August 11, 2023, following the GST Council’s recommendations.

As per the amendment, online gaming has been defined as the “offering of a game on the internet or an electronic network and includes online money gaming“. It is specified that persons who organise or arrange the supply of actionable claims involved in or by way of betting, casinos, gambling, horse racing, lottery or online money gaming would be deemed to be suppliers of the specified actionable claims. The provisions of the Central Goods and Services Tax Act, 2017 would apply to such persons as if they are suppliers liable to pay tax in respect of the supply of such actionable claims.[1]

Further, integrated tax would be payable on the supply of online money gaming by a supplier located outside India to a person in India. Such suppliers are required to obtain a single registration through the simplified registration scheme.[2]




Govt Launches Invoice Incentive Scheme

The government of India, in association with the state governments, has launched the ‘invoice incentive scheme’ named ‘Mera Bill Mera Adhikar’ scheme[1] to encourage consumers to insist on invoices for their purchases. The scheme has been introduced as a pilot project for a year for all Business to Consumer (B2C) invoices issued by GST-registered suppliers in some of the states of India such as Haryana, Assam, Gujarat and the union territories of Dadra and Nagar Haveli, Daman and Diu as well as Puducherry on a trial basis, to inculcate in consumer the drive to avail post customer support, product replacement or refund with additional tax compliance at retail stage. As an incentive, the government is offering the consumers a chance to win Rs. 1 crore, Rs. 10 lakh, and Rs. 10,000 respectively.

GSTN, in collaboration with its partner, M/s e-connect Solutions Pvt. Ltd., is in the process of developing a technology platform. This platform aims to enable citizens to register themselves and submit invoices through a user-friendly mobile application and web portal. The advanced technology behind this mobile application and portal will have the capability to automatically extract essential information from printed invoices, such as GSTIN, invoice number, payment amount, and tax amount.[2]

This scheme is designed to achieve several goals, including promoting and rewarding compliant behaviour among consumers, incentivizing tax-compliant businesses, stimulating consumer spending, and combating tax evasion.[3]


[1] Launch of Invoice Incentive Scheme “Mera Bill Mera Adhikar” from 1st September 2023, Press Information Bureau Delhi, available at:, last accessed- September 4, 2023

[2] Invo-Incentivisation, GSTN, available at:, last accessed – September 4, 2023

[3] Supra Note 2


ESFI President Asserts 28% GST is Not Applicable to Esports

On July 24, 2023, the Esports Federation of India (ESFI) issued a statement specifying that the Goods and Services Tax (GST) at the rate of 28% applicable to online gaming did not have a bearing on the esports segment.

Recently, the Goods and Services Tax (GST) Council, in its 50th meeting, proposed the imposition of tax at a rate of 28% on online gaming, casinos and horse racing. In the case of online gaming, the tax was said to apply to the full value of the bets placed.

The GST council reiterated the imposition of the tax in its 51st meeting and plans to implement it from October 1. There are hints of review down the line, however, they may be limited to valuations and tax rates. States are required to amend their laws for implementation, however, the norms will explicitly clarify that tax cannot be levied in states where ban is in place.

The President of ESFI, Vinod Kumar Tiwari, stated that the said rate “is going to be applicable to the iGaming sector, including real-money gaming (RMG), fantasy sports, teen patti, rummy, and poker, which are classified under gambling or betting in the rest of the world. Contrary to some media reports, this GST is neither applicable nor will it have any impact on the ‘video games or the eSports industry”.

Mr. Tiwari, who also serves as the Director (NOC & International Relations/Marketing Department) at the Olympic Council of Asia (OCA), added that the concepts of “game of skill” and “game of chance” do not have any relevance in the esports industry. He expressed dismay at the correlation assumed between esports and iGaming (and other games involving betting & gambling) and asserted that video gamers seek entertainment and not monetary gains.

It was clarified that esports differs from activities such as iGaming, especially considering the strict policies adopted by video game publishers against charging entry fees for esports events, and that esports will continue to be taxed at the rate of 18%.


50th GST Council Meeting: Key Highlights

The Goods and Services Tax (GST) Council recently convened its 50th meeting, marking a significant milestone in the country’s tax reforms journey. It was held under the chairpersonship of the Union Finance and Corporate Affairs Minister, Smt. Nirmala Sitharaman.

Some of the major recommendations are as follows: –

  1. Changes in GST Tax Rates – The GST Council recommended various changes in GST rates on goods to address specific issues and promote certain sectors.
  • Reduction in GST rates on uncooked/unfried snack pellets to 5%, and regularisation of GST payments made in the past on these products, on an “as-is” basis. This reduction aims to provide relief to manufacturers and promote the snack industry.
  • IGST exemption on medicines and Food for Special Medical Purposes (FSMP) used in the treatment of rare diseases listed under the National Policy for Rare Diseases, 2021, when imported for personal use. This exemption was extended to FSMP imported by Centres of Excellence for Rare Diseases or recommended by any of the listed Centres.
  • Imposition of tax at the rate of 28% on activities of online gaming, casinos, and horse racing. In the case of casinos, this tax will be applicable on the face value of chips purchased and in horse racing, it’ll be on the full value of the bets placed with the bookmaker/ totalisator. When it comes to online gaming, the 28% tax will apply to the full value of bets placed.
  1. Measures for Facilitation of Trade – The GST Council introduced measures to simplify trade processes and reduce compliance burdens.
  • Recommendation regarding the Goods and Services Tax Appellate Tribunal (Appointment and Conditions of Service of President and Members) Rules, 2023. To ensure that the GST Appellate Tribunal is constituted soon, it is proposed that the relevant provisions of the Finance Act, 2023, be notified w.e.f. August 1, 2023. These rules were aimed at streamlining the dispute resolution mechanism.
  • Continuation of the relaxations provided in the previous financial year for filing annual returns (FORM GSTR-9 and FORM GSTR-9C). Further, taxpayers with an aggregate annual turnover of up to Rs. 2 Crores were exempted from filing annual returns (in FORM GSTR-9/9A) to ease the compliance burden on smaller taxpayers.
  • Clarifications on various GST-related issues through circulars. These include clarifications on GST liability and input tax credit reversal in cases involving warranty replacements, refund-related issues, TCS liability in multi-operator transactions, and invoicing requirements for specific services.
  1. Measures for Streamlining Compliance in GST – To enhance compliance and minimize fraudulent practices, the GST Council proposed several measures.
  • Bringing in an amendment to the CGST Rules, 2017 to improve the registration process and address fake and fraudulent registrations. The changes proposed include the requirement to furnish details of a valid bank account within 30 days of registration and allowing system-based suspension of registrations for non-compliance.
  • Adopting a mechanism for system-based intimation to taxpayers regarding excessive Input Tax Credit (ITC) claims in FORM GSTR-3B compared to FORM GSTR-2B. Taxpayers would be required to explain the reasons for the differences or take remedial action. This aims to reduce ITC mismatches and misuse.
  • Adding a new rule in the CGST Rules, 2017 and introducing FORM GST DRC-01D to provide for the procedure of tax and interest recovery in respect of the amount intimated under rule 88C which hasn’t been paid and for which no satisfactory explanation has been furnished by the registered person.


Increased TCS Rates for Foreign Remittances to Apply from October 1

The Ministry of Finance recently announced that the tax rate applicable to remittances for purposes other than education and medical treatment under the Liberalized Remittance Scheme (LRS) and for the purchase of overseas tour program packages will be increased from 5% to 20% w.e.f. October 1, 2023.

In the year 2020, sub-section (1G) was inserted into Section 206C of the Income-tax Act, 1961 to impose a tax on remittances made under the LRS and those made towards Overseas Tour Program Packages. As per this provision, the authorized dealer who remits the money and the seller of the said package are required to collect tax.

The said provision was amended by the Finance Act, 2023 and the TCS rate was increased from 5% to 20% for remittances for purposes other than education and medical treatment under LRS and for the purchase of overseas tour program packages. The same was scheduled to come into effect on July 1, 2023.

Thereafter, the Foreign Exchange Management (Current Account Transactions) (Amendment) Rules, 2023 were notified by the Finance Ministry on May 16, 2023, which omitted Rule 7 from the 2000 Rules thereby bringing credit card transactions carried out by individuals in foreign countries within the ambit of the LRS. 

The following changes have been brought about through the press release: –

  • The implementation of the amendment rules has been postponed so that banks and card networks have sufficient time to put in place the requisite IT-based solutions. Hence, credit card transactions carried out overseas are not covered under LRS and are not subject to TCS.
  • It is specified that irrespective of purpose, TCS will not be applicable to foreign remittances of up to Rs.7 Lakh per financial year. Beyond this threshold, a TCS of 0.5% would apply if remittance is for education financed by a loan and 5% if it is for education or medical treatment. When it is for other purposes, the 20% rate will apply for remittances above the threshold limit. In the case of overseas tour program packages, the existing 5% rate would continue to apply for payment up to Rs. 7 Lakh and if the payment exceeds the said amount, the 20% rate would apply.
  • The increased TCS rates will now be implemented from October 1, 2023, and not from July 1, 2023.

To remove any difficulty in the implementation of these changes, the Government released a circular dated June 30, 2023, with certain FAQs.



Regional Sports Club’s Request for Building Tax Exemption Rejected

Recently, the application of the Regional Sports Club (RSC) requesting building tax exemption was rejected by the Kerala State Government.

The RSC operates on the Kerala State Sports Council’s (KSSC) land at Kadavanthra, Kochi. It was asserted by the club that as per government policy, “sports is part of education” and since the club is an educational institution and a charitable organization, it is eligible for tax exemption.

After perusal of the necessary documents, and considering details such as membership fee charged, number of members, rent collected for accommodation provided, etc., the state government concluded that RSC is not entitled to get tax exemption. Rejecting its application and claims, the state revenue department ordered the RSC to pay tax to the tune of Rs. 60 lakhs.


CBDT Releases Guidelines On Online Game Winnings

The Central Board of Direct Taxes (CBDT) has issued guidelines to address the concerns of stakeholders regarding the deduction of income tax on online game winnings under Section 194BA of the Income-tax Act, 1961. The said section was inserted vide the Finance Act, 2023, and is in operation w.e.f. April 1, 2023.

Considering that several gamers play with an insignificant amount and withdraw small amounts, it has been clarified that tax need not be deducted from net winnings if the amount withdrawn does not exceed Rs. 100 in a month.

Further, it is specified that any deposit in the form of a bonus, referral bonus, incentive, etc. by the online gaming intermediary into the user account would form part of net winnings and hence, tax is liable to be deducted at the time of withdrawal and at the end of the financial year under Section 194BA.

When one user has multiple wallets, the guidelines state that under Rule 133 of the Income-tax Rules, 1962, the user account would include every account of the user which is registered with the online gaming intermediary and where any taxable deposit, non-taxable deposit or winning of the user is credited and withdrawal by the user is debited.

The said rule was inserted by the Income-tax (Fifth Amendment) Rules, 2023 notified on May 22, 2023, and provides the following formula for calculating the net winnings from online games: – Net winnings = A-(B+C). Here, A refers to the amount withdrawn from the user account, B to the aggregate amount of non-taxable deposit made in the user account by the owner of such account during the financial year, till the time of such withdrawal and C is the opening balance of the user account at the beginning of the financial year.


TCS Not Applicable To International Credit Card Transactions Upto Rs 7 Lakh

The Ministry of Finance has clarified that the Tax Collection at Source (TCS) at the rate of 20% would not apply to payments made by individuals using international debit or credit cards up to Rs.7 lakh per financial year. Such small transactions have been excluded from the Liberalized Remittance Scheme (LRS) limits.

The press release dated May 19, 2023, also stated that the prevailing beneficial TCS treatment for education and health payments would continue.

As per the Foreign Exchange Management (Current Account Transactions) Rules, 2000, prior approval of the Reserve Bank of India (RBI) is required when foreign remittances are made, exceeding specified limits for purposes enumerated in Schedule III[1]. The rules also specified that this requirement does not apply to the use of international credit cards by persons for covering expenses while on a visit outside India[2].

However, the Foreign Exchange Management (Current Account Transactions) (Amendment) Rules, 2023 notified by the Finance Ministry on May 16, 2023, omits Rule 7 from the 2000 Rules thereby bringing credit card transactions carried out by individuals in foreign countries within the ambit of the LRS. A joint reading of the amendment rules and the Finance Act, 2023 would indicate that the TCS payable for such transactions exceeding Rs. 7 Lakh would be 20% w.e.f. July 1, 2023.

[1] Rule 5 of the Foreign Exchange Management (Current Account Transactions) Rules, 2000

[2] Rule 7 of the Foreign Exchange Management (Current Account Transactions) Rules, 2000