INCOME TAX5 Sept 2026
Bengaluru man gets tax demand on ₹2.33 crore online gaming winnings: What convinced ITAT to rule in his favour
An online gaming taxpayer in Bengaluru faced a tax notice for not declaring ₹2.33 crore of winnings for AY 2022-23. The tax officer treated the full amount as taxable. But the taxpayer showed his total buy-in was ₹2.61 crore, leaving him a net loss of about ₹27.99 lakh. He won the appeal because tax is on real income, not gross money movement.
Key Statutory Highlights
- The taxpayer did not report ₹2.33 crore of online gaming winnings in his income tax return for AY 2022-23 and received an income tax notice.
- The tax officer treated the full gross winnings as taxable, but the taxpayer showed his total buy-in was ₹2.61 crore and he incurred a net loss of about ₹27.99 lakh.
- The appellate ruling went in his favour, supporting the principle that only real income is taxable and not gross movement of money.
Actionable Advice for Taxpayers / Founders:Keep records of your buy-ins, withdrawals and net profit or loss from online gaming. If the tax department sends a notice based only on gross winnings, respond with your net-loss workings and take professional help, since outcomes depend on your facts.
Statutory Disclaimer: TaxQue Shorts are AI-assisted editorial briefs for compliance awareness. This brief has not passed every source check; confirm the original notification before acting. This does not constitute formal legal or CA counsel.
TaxQue News Desk
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