GST Non-Compliance: DGGI Designated as Nodal Officer for Issuing Takedown Orders

The Ministry of Finance has appointed the Additional/Joint Director (Intelligence) of the Directorate General of GST Intelligence Headquarters (DGGI-HQ) as the nodal officer responsible for issuing takedown orders under the provisions of the Information Technology Act, 2000, in cases of non-compliance with the GST law by offshore suppliers of online money gaming.

The DGGI’s annual report, released last year, highlighted offshore illegal betting and gambling platforms as a significant source of GST leakage. In addition, 658 offshore entities were identified as non-registered and non-compliant, prompting an investigation. As part of the action, 167 URLs/websites were recommended for blocking.

Suppliers have to pay integrated tax on the supply of online money gaming by persons located outside India and obtain a single registration under the Simplified Registration Scheme. These requirements are contained in Sections 14A(1) and (2) of the IGST Act, 2017. Failure to comply with these provisions renders the information generated, transmitted, received or hosted in any computer resource used for the supply liable to be blocked for access by the public. The same is true of Section 14A(3) of the IGST Act.

The special provision mentioned above for specified actionable claims supplied by a person located outside taxable territory was introduced in the 2017 Act, which was amended in August 2023.

Previously, requests had to be directed through MeitY. Still, the government has now designated DGGI as the nodal authority to issue takedown orders in cases of non-compliance by offshore online money gaming suppliers.