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Supreme Court Halts Rs 5,712 Crore GST Demand Against Paytm’s First Games

The interim relief pauses proceedings on a contentious tax notice as India’s online gaming sector faces broader scrutiny over GST classification.

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Overview

  • The Supreme Court of India has stayed proceedings on a Rs 5,712-crore GST notice issued to Paytm’s gaming arm, First Games Technology.
  • The notice, covering the period from January 2018 to March 2023, demands GST at 28% on total entry amounts, a method gaming firms are contesting.
  • First Games filed a writ petition on May 3, 2025, challenging the retrospective tax demand, leading to the court’s interim stay on May 23, 2025.
  • Other gaming firms like Dream11 and Games24X7 have also legally opposed similar retrospective GST notices, highlighting industry-wide concerns.
  • The case could set a precedent for GST treatment in India’s rapidly growing real-money gaming sector, which faces significant financial pressures.