DGGI blocks 357 illegal online gaming websites, attaches 2,400 bank a/cs

GST intelligence officers have blocked 357 websites of illegal offshore online gaming firms and attached about 2,400 bank accounts, the Finance Ministry said on Saturday. The ministry also cautioned the public against engaging with offshore gaming platforms, even though many Bollywood celebrities and cricketers, besides social media influencers, are found to be endorsing these platforms.

About 700 offshore e-gaming companies are under the Directorate General of Goods and Services Tax Intelligence (DGGI) scanner, as these entities are evading GST by failing to register, concealing taxable pay-ins, and bypassing tax obligations.

Investigations also revealed that these offshore companies operated through 'mule' bank accounts to process transactions, the ministry said, adding the DGGI blocked 166 'mule' accounts.

"So far, 357 websites/URLs of illegal/non-compliant offshore online money gaming entities have been blocked by the DGGI, in coordination with the Ministry of Electronics and Information Technology (MeitY)," the ministry said in a statement.

In two other separate cases, DGGI collectively blocked nearly 2,400 bank accounts and put a freeze on nearly Rs 126 crore.

In another operation against a few Indian nationals who were running online money gaming platforms from outside India, it revealed that these individuals were facilitating online money gaming to Indian customers through various such online platforms, including Satguru Online Money Gaming Platform, Mahakaal Online Money Gaming Platform and Abhi247 Online Money Gaming Platform and are using mule bank accounts to collect money from Indian customers.

DGGI has so far blocked 166 mule accounts linked to these platforms. Three such persons have been arrested till now, and an investigation against more such individuals is under progress.

Under the GST law, 'Online Money Gaming', being actionable claim, is classified as a supply of 'Goods' and is subject to a 28 per cent tax.

Entities operating in this sector are required to register under the GST.

With the upcoming IPL season, enforcement actions by tax officers will be more stringent to curb illicit gaming operations, the ministry said, urging people to engage only with regulated e-gaming platforms.

The ministry said non-compliance by foreign entities distorts fair competition, harms local businesses, and skews the market.

These unscrupulous foreign entities circumvent restrictions by creating new web addresses.

"Investigations also revealed that these companies operated through 'mule' bank accounts to process transactions. Funds collected through mule accounts leave the potential to be funnelled into illicit activities, which may also be dangerous for the national security point of view," the ministry added.

The ministry further said, "It has been observed that many Bollywood celebrities and cricketers, along with YouTube, WhatsApp, and Instagram influencers, are found endorsing these platforms, and therefore, the public is advised to remain cautious and not engage with offshore online money gaming platforms as it may jeopardise their personal finances and indirectly support activities that undermine financial integrity and national security".