India’s Ministry of State for Finance has begun cracking down on hundreds of illegal offshore betting sites, including dozens of gaming apps, Yogonet reported December 11.
In his report to Parliament’s lower house, Minister Pankaj Chaudhary said that the banned platforms include Parimatch, Fairplay, 1XBET, Lotus365, Dafabet, and Betwaysatta.
According to the Economic Times, the minister added, “Ministry of Electronics and Information Technology (MeitY) blocked a total of 581 applications under section 69A of IT Act, 2000 which includes 174 betting and gambling related applications, 87 loan lending applications, and other applications including gaming applications like PUBG, GArena Free Fire, etc.”
Some of the action took place after investigations by the Enforcement Directorate (ED). In November the ministry banned 22 illegal apps and websites following a probe by the ED that included raids on Mahadev Book in Chhattisgarh.
Early this year the government amended the IGST Act (The Integrated Goods and Services Tax Act) which requires offshore gaming sites be registered locally. It also blocked nearly 140 black market sites, although some are still active. It is pressing offshore gaming operations and platforms by going after proxy bank accounts that use cryptocurrency and hawala (a method of transferring money without actually moving currency) among other methods.
In October the Times warned that the government uncovered more than 100 illegal sites using domain farming.
In a separate but related development, the largest gaming firm in India, Delta Corp has won interim relief by the High Court of Calcutta for a demand by a state government for back taxes, Inside Asian Gaming reported. Delta has been hit by a flurry of demands from state governments in claims that add up to more than its net worth.
For example, in October, the Directorate General of GST Intelligence, Kolkata demanded Rs 6,384 crore ($766 million) in back IGST taxes. Delta filed court papers stating that the claim was based on “gross bet value of all games played at the casinos during the relevant period,” and compared it to efforts by the country’s GST Council to tax gaming deposits of operators at 28 percent.
The company declared, “Demand of GST on gross bet value, rather than gross gaming revenue, has been an industry issue and various representations have already been made to the Government at an industry level in relation to this issue.” It promised to exercise all its legal options.
The relief granted by the High Court of Calcutta was to a Delta subsidiary, Deltatech Gaming Ltd. The court ruled “no effect shall be given to any order passed by the Tax Authority in relation to the show cause notice for the above demand without the leave of the Hon’ble High Court.”
The Sikkim High Court issued a temporary stay on a similar demand a month ago by the Directorate General of GST Intelligence, Hyderabad for Rs 628 crore ($75.5 million) in back taxes for the Casino Deltin Denzong.
