The levy of GST on actionable claims arising from betting and gambling, including online gaming and fantasy sports, is constitutionally valid under Article 246A and the CGST Act, 2017, with valuation rules 31A, 31B, and 31C being valid and retrospective.

1. Heard Mr. Pradeep Aggarwal, learned Counsel for the petitioners as well as Ms Sangita Pradhan, learned Deputy Solicitor General of India. He draws attention to paragraph 6 of the order dated 20.09.2024 passed by this Court and submitted that the Supreme Court vide judgment dated 27.05.2026 reported in 2026 INSC 595 has dealt with the issues and pronounced its verdict. It is noticed that on 20.09.2024, the learned Counsel for the petitioners had submitted that similar matters were pending consideration before the Supreme Court.

2. The Supreme Court on considerations of the various issues raised in the various petitions before it concluded as under:-

“84. In view of the foregoing discussion and the connected judgment, we hold as under:

(i) The essential element of “betting” and “gambling” lies in staking money or money’s worth upon uncertain outcomes. The character of betting and gambling does not depend exclusively upon whether the underlying activity is a game of skill or a game of chance, but upon the existence of stakes placed upon uncertain future contingencies. Consequently, even where the underlying activity involves substantial elements of skill, once participation is conditioned upon staking money or money’s worth upon uncertain outcomes, the resulting transaction acquires the character of betting and gambling within the framework of the GST legislation. Accordingly, online gaming activities, including fantasy sports and other games played on digital platforms involving staking upon uncertain outcomes, constitute betting and gambling for purposes of the GST framework.

(ii) The legislative scheme embodied in the CGST Act, 2017 and the corresponding State enactments validly subjects actionable claims arising from betting and gambling to GST. The provisions embodied in Sections 2(31), 2(52), 7, 9 and 15 of the CGST Act, insofar as they operate upon actionable claims arising from betting and gambling, are constitutionally valid and clearly traceable to the legislative competence conferred by Article 246A of the Constitution. The levy is upon the taxable supply of actionable claims and not upon the activity of betting or gambling simpliciter.

(iii) Further, the levy of GST on the supply of actionable claims arising from betting and gambling is constitutionally valid and does not transgress Articles 366(12) or 366(12A) of the Constitution. Article 366(12A) merely furnishes the constitutional meaning of “goods and services tax” and does not exhaustively define the contours of taxable supply, valuation or the treatment of specific classes of transactions. Those matters validly fall within the legislative domain contemplated under Article 246A. Consequently, the inclusion of actionable claims within the ambit of “goods” under Section 2(52) and the levy imposed under Section 9(1) cannot be said to violate the constitutional scheme governing GST. The challenge to the constitutional validity of Sections 2(52) and 9(1) of the CGST Act is accordingly rejected.

(iv) The challenge founded upon Articles 14, 19(1)(g), 21 and 265 of the Constitution is likewise liable to be rejected. The statutory framework bears a clear nexus with the taxable event identified by the legislature, namely the supply of actionable claims arising from betting and gambling transactions. Mere commercial hardship, reduction in profitability or increased tax incidence cannot by itself render a fiscal measure unconstitutional. Article 21 has no application in the present fiscal context. The levy is supported by statutory authority traceable to Sections 7, 9 and 15 of the CGST Act read with Schedule III and the relevant Rules framed