Synopsis
Offshore gaming firms found a way to use the site name cgst.ahmedabadzone.gov.in to create additional, fake pages, complete with sub-links that take the browser to the actual gaming platforms, in claiming legitimacy of these online casinos.Listen to this article in summarized format
These offshore gaming firms found a way to use the site name cgst.ahmedabadzone.gov.in to create additional, fake pages, complete with sub-links that take the browser to the actual gaming platforms, in claiming legitimacy of these online casinos.
The gaming world chuckled at the irony as these faceless operators which are banned in the country, forbidden from accepting money from local players, and often blocked by the Directorate General of GST Intelligence and the ministry of electronics and IT, pulled a prank with a government GST portal name.
The distant tricksters did not hack the Ahmedabad tax office website and the misleading pages are not visible on the official site. But, anyone stumbling on the links or searching the net would find foreign gaming companies talking about customer service, betting upsides, and wagering access to global sporting events.
"It is surprising that the GST Department's official domain name has been exploited by unscrupulous elements to insert promotional backlinks and content supporting or endorsing illegal betting portals. This appears to have been done by exploiting loopholes in the security system of the official GST department website to boost the Search Engine Optimisation (SEO) rankings of these illegal betting portals," said technology & gaming lawyer Jay Sayta.
Ever since real money games were banned in India, overseas online betting firms beyond the jurisdictions of Indian law enforcement authorities, have been wooing Indian players hooked on to the betting-often clueless that by remitting money with international credit cards, through cryptocurrencies, and local agents using mule accounts and hawala routes they are violating India's stern foreign exchange and anti-money laundering regulations.
"The incident highlights a security lapse on part of the GST Department in the maintenance and upkeep of their website. A thorough investigation and audit should be conducted to ensure that such instances do not get repeated. Necessary action should also be taken against those responsible for this lapse," said Sayta.
Government sites conjure a greater confidence among unsuspecting browsers carrying the impression that while RMGs are banned in India there are no restrictions in placing bets with similar firms abroad.
The content of these half a dozen fake pages - almost all released on April 19 - is replete with grammatical errors and convoluted claims. Nonetheless, they manage to crudely put across the basic message: "Here are some reasons why we believe you to XYZ sporting events playing is legitimate" (sic), says one of them. Another with links in Bangladesh showcases games like 'Wild Switch Drop', 'love Joker', 'Persian Chance' and '777 Strike'.
"Section 14A of the IGST Act is specifically designed to cover offshore online gaming platforms that provide services to users in India, by assigning tax liability directly to these operators, irrespective of whether they have a physical presence in the country," said chartered accountant Ashish Karundia.
To support compliance, the provision also requires such platforms to appoint either a local representative or a designated person within India.
"The provision's strength lies in its enforcement mechanism. Platforms that fail to comply may be blocked, going beyond traditional methods of tax recovery. Given recent instances where foreign gaming companies have attempted to project legitimacy through misleading practices, Section 14A highlights that the legal framework is already in place. The critical challenge now is ensuring timely and coordinated enforcement to achieve meaningful compliance," said Karundia.
Interestingly, the mischief to mislead local players come at a time when the Supreme Court is about to release its much-awaited verdict on the tussle between the Indian RMG industry and the GST authorities.
