The West Bengal Authority of Advance Ruling (AAR) has ruled that playing of bridge against money qualifies to be “specified actionable claim”, the applicant cannot be held to be engaged in supply of specified actionable claim by organising the tournament of bridge where contribution of money deposited in a common pool and the applicant does not lien over this money or money’s worth contributed by players, therefore Goods and Service Tax (GST) is not payable.
The bench of Tanisha Dutta (Joint Commissioner, CGST & CX) and Joyjit Banik (Additional Commissioner, SGST) observed that the applicant neither provides any online platform for participating in the game of bridge nor retains any amount of money as “platform fee” from the deposit amount made by each player. The applicant being the organiser of the bridge tournament does not lien over the money or money’s worth contributed by players. The applicant has submitted that the contribution of money is deposited in a common pool and an independent person sponsors prize money.
The applicant is stated to be an apex body for the game of contract bridge in India. The applicant works for the development and conduct of the bridge in line with guidelines issued by the World Bridge Federation (WBF) for selection of national teams for various events at Asian and zonal level. The applicant states that it along with its designated associates is going to organize an offline/physical tournament of bridge played for money in the state of West Bengal in near future.
The applicant sought the advance ruling on the issue whether contributions/participation money paid/ stakes bought by the players for playing physical/offline game of bridge (when played for money) or winning thereof or organizing games/tournaments of bridge (when played for money) qualify as supply of “specified actionable claims” under section 2(102A) of the GST Act, 2017.
The applicant relied on the definition of “place of business” under section 2(85) of the GST Act and contended that a “place of business” comes into existence only once the business has commenced and it would be counterintuitive to suggest that a place of business should exist even at the stage where a business entity is proposing to start its business in a State.
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The applicant submitted that in the matter of Junglee Games India Pvt. Ltd. Vs State Of Tamil Nadu & Ors. AIR 2021 Mad 252, Justice Sanjib Banerjee, then Chief Justice of Madras High Court observed the jurisprudence laid down by the Supreme Court, that ‘betting’ and ‘gambling’ have become nomen juris, i.e., a well-understood legal definition, which has been interpreted and defined by Courts to apply only to “Games of Chance”, whereas, “Games of Skill” such as Bridge played for money or money’s worth have been held to not fall under ‘betting’ and ‘gambling’.
The applicant underscored that the game of bridge cannot be considered as lottery, betting and gambling. The applicant argues that the words ‘betting’ and ‘gambling’ are nomen juris and their legal definition would apply here, especially because terms are not defined under the CGST Act/WBGST Act. In India, the legislative powers are divided between the centre and the states under the Constitution of India, 1950 .Under its Seventh Schedule, the Constitution grants each state of the country the exclusive power to enact its own laws on “betting and gambling” for its own territory. The Public Gambling Act, 1867, a colonial-era statute still in force, has been adopted by several states but some states are making their state amendments for the purpose of betting and gambling.
An actionable claim is a claim to unsecured debt or a claim to beneficial interest in movable property not in possession of the claimant. The applicant contended that contract bridge or simply bridge is a trick taking card game using a standard 52 card deck. In its basic format, it is played by four players in two competing partnerships with partners sitting opposite to each other around a table. The game consists of a number of deals each progressing through four phases. The cards are dealt with the players then the players call or bid in an auction seeking to take the contract specifying how many tricks the partnership receiving the contract needs to take to receive points for the deal. During the auction, partners use their bids to exchange information about their hands including
The AAR concluded that organising a tournament and allowing the players to take part in the tournament against participation fee would qualify to be a supply of services by the organiser to the participants. However, even it is held that playing of bridge against money qualifies to be “specified actionable claim”, the applicant cannot be held to be engaged in supply of specified actionable claim by organising the tournament of bridge where contribution of money deposited in a common pool and the applicant does not lien over this money or money’s worth contributed by players.
Applicant’s Name: Bridge Federation of India
Date: 29/07/2024
