Dream11 challenges Rs 25,000 crore GST notice in court

Mumbai: Sporta Technologies Pvt Ltd, which operates the online gaming portal Dream11, has filed a petition in the Bombay High Court challenging a pre-show cause notice issued to it by the Directorate General of GST Intelligence (DGGI) alleging evasion of Goods and Services Tax (GST) amounting to the tune of a staggering Rs 25,000 crore.

The plea was expected to come up for hearing shortly, as the GST pre-show cause notice — billed as the highest ever indirect tax claim from any entity — stumped legal and corporate circles across the country.

Dream11, led by Harsh Jain, is a leading fantasy gaming sector player both in terms of valuation and user base, as per the Moneycontrol.com.

The company’s recent valuation crossed $8 billion and it claims to have a user-base of several crores of individuals. Last year, Dream11 posted a net profit of Rs 142 crore from an operating revenue of over Rs 3,840 crore, according to Moneycontrol.com

Besides Dream11, the DGGI is understood to have slapped several such pre-show cause notices targeting leading online real money gaming companies for purported GST dues amounting to over Rs 55,000 crore, and the total GST demand may be almost double to around Rs 100,000 crore.

Among the entities which have been slapped with pre-show cause notices (served before the show-cause notice) are Gameskraft, PlayGames24x7, My11Circle, RummyCircle, etc. for huge but varying amounts of GST claims.

Dream11 holds the leading position in the fantasy gaming sector in India, both in terms of its valuation and the number of users. The company’s most recent valuation surpassed $8 billion, and it boasts a user base of over 180 million individuals on its sports fantasy platform.

In the fiscal year concluding on March 31, 2022, Dream11 disclosed a net profit of Rs 142 crore, generated from an operating revenue of Rs 3,840.7 crore.

Image courtesy of Provided

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