Supreme Court in the Case of Skill Lotto Solutions Pvt. Ltd. Versus Union of India

Case Covered:

Skill Lotto Solutions Pvt. Ltd.

Versus

Union of India

Facts of the Case:

The petitioner, an authorized agent, for the sale and distribution of lotteries organized by the State of Punjab has filed this writ petition impugning the definition of goods under Section 2(52) of Central Goods and Services Tax Act, 2017 and consequential notifications to the extent it levies a tax on lotteries. The petitioner seeks a declaration that the levy of tax on the lottery is discriminatory and violative of Articles 14, 19(1)(g), 301, and 304 of the Constitution of India.

Observations:

The value of taxable supply is a matter of statutory regulation and when the value is to be transaction value which is to be determined as per Section 15 it is not permissible to compute the value of taxable supply by excluding prize which has been contemplated in the statutory scheme. When the prize paid by the distributor/agent is not contemplated to be excluded from the value of taxable supply, we are not persuaded to accept the submission of the petitioner that prize money should be excluded for computing the taxable value of supply the prize money should be excluded. We, thus, conclude that while determining the taxable value of supply the prize money is not to be excluded for the purpose of levy of GST.

The Decision of the Court:

In the foregoing discussion, we are of the view that the petitioner is not entitled to reliefs as claimed in the writ petition.

We may, however, notice that petitioner has prayed for grant of liberty of challenging the notifications dated 21.02.2020/02.03.2020 by which rate of GST for lottery run by the State and lottery organized by the State have been made the same, which notification has not been challenged in the writ petition since the notifications were issued during the pendency of writ petition. Petitioner has prayed that the said issue be left open, the notification having not been challenged in the writ petition liberty be given to the petitioner to challenge the same inappropriate proceedings. We accept the above prayer of the petitioner. The petitioner shall be at liberty to challenge the notifications dated 21.02.2020/02.03.2020 (challenging the rate of levy tax uniformly at 28%) separately in appropriate proceedings. Subject to liberty as above, the writ petition is dismissed.

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