New Delhi: Noting that numerous Bollywood stars, cricketers, and influencers from platforms like YouTube, WhatsApp, and Instagram are promoting these offshore gaming sites, the Directorate General of Goods and Services Tax Intelligence (DGGI) urged the public to exercise caution and refrain from engaging with these platforms, as doing so could endanger their financial well-being and inadvertently support operations that compromise financial integrity and national security.
With the IPL season approaching, enforcement measures will be intensified to suppress illicit gaming activities. “It is essential for individuals to stay informed and opt for regulated platforms to ensure responsible gaming practices,” the DGGI stated.
DGGI asserted it was dedicated to combating the threat posed by illegal offshore gaming entities, and claimed it has significantly intensified its enforcement actions against offshore online gaming companies, which encompass both domestic and international operators engaged in online money gaming.
Under the Goods and Services Tax (GST) framework, online money gaming is classified as an actionable claim and categorized as a supply of goods, making it liable to a tax rate of 28%. Consequently, businesses operating in this sector are required to register under GST to adhere to legal obligations.
At present, the DGGI is investigating around 700 offshore entities involved in online money gaming, betting, and gambling. These entities have been identified as evading their GST responsibilities by failing to register, concealing taxable income, and neglecting their tax duties.
In a concerted effort to combat these violations, the DGGI, in collaboration with the Ministry of Electronics and Information Technology (MeitY), has successfully blocked 357 websites and URLs linked to illegal or non-compliant offshore online gaming operations, utilizing Section 69 of the IT Act, 2000.
In a recent operation aimed at dismantling illegal gaming platforms, the DGGI froze nearly 2,000 bank accounts that were being used to collect funds from participants, leading to the attachment of Rs. 4 crore, in partnership with the Indian Cyber Crime Coordination Centre (I4C) and the National Payments Corporation of India (NPCI).
Furthermore, 392 bank accounts associated with UPI IDs found on the websites of certain offshore entities have also been frozen, resulting in a provisional attachment of Rs. 122.05 crore in these accounts. Another investigation revealed that Indian nationals were operating online money gaming platforms from abroad, facilitating access for Indian customers through various platforms such as Satguru, Mahakaal, and Abhi247, while employing mule bank accounts to collect funds from users in India.
DGGI has successfully blocked 166 mule accounts associated with these platforms to date. So far, three individuals have been apprehended, and investigations into additional suspects are ongoing.
The non-compliance of foreign entities disrupts fair competition, negatively impacts local businesses, and distorts the market landscape. These entities often evade regulations by establishing new web addresses. Investigations have also uncovered that these companies utilize ‘mule’ bank accounts to facilitate transactions. The funds generated through these accounts pose a risk of being diverted into illegal activities, which could threaten national security, the DGGI stated.
– global bihari bureau
