The Supreme Court on Thursday (10 December) ruled that the charge of Goods and Service Tax (GST) on lotteries, betting and gambling would be maintained, stating that doing so did not violate any constitutional requirement.
The ruling bench was headed by Justice Ashok Bhushan, Justices M.R Shah and R. Subhash Reddy. They noted that even before independence the concepts of lottery, betting and gambling were well-known that were taxed and regulated by various legislations.
“The above three categories have been included by the Parliament for purpose of imposing GST and not tax other unlawful claims. It can’t be said that there is no rationale or reason for taxing these three and not others,” it noted.
The Central Goods and Service Tax Act of 2017 allows authorities to tax lotteries which was accordingly upheld by the ruling. The bench stated that there is no discrimination towards the taxing of lotteries, given that it dismissed the plea of Skill Lotto Solutions Pvt Ltd as they did not agree with the firm’s submission that the inclusion of ‘actionable claim’ in the definition of goods in the CGST Act is unconstitutional as it contradicts the legal meaning of goods.
It ruled that the inclusion of actionable claim in definition ‘goods’ in the CGST Act is not contrary to the legal meaning of goods and is therefore neither illegal nor unconstitutional.
This was in response to a petitioner who claimed that the levy of tax on lotteries violated Articles 14, 19 (1)(g), 301 and, 304 of the constitution and were discriminatory. The court replied to this saying that they were aware of the definition of goods under Section 2(52) of the Act and that it did not violate any constitutional provision. They continued saying that the Parliament had the full authority to create laws regarding GST.
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