According to reports from Business Standard, One 97 Communications Ltd, the parent company of Paytm, announced that the GST demand against its subsidiary First Games Technology has been significantly reduced to ₹703.66 crore from the earlier proposed liability of ₹5,712 crore for the period from April 2018 to March 2023. The revised order was issued by the Additional Commissioner of Central Goods and Services Tax (CGST), Noida, Uttar Pradesh, and was received by First Games on October 12, 2026. The demand carries a penalty equivalent to the tax liability, along with applicable interest, as reported by Business Standard.
As reported by Business Standard, Paytm stated that there would be no incremental financial impact on the company due to the subsidiary's accounting treatment. The company explained that First Games is treated as a joint venture for group consolidation purposes under applicable accounting standards, with its revenue not consolidated in Paytm's financial statements. Paytm added that First Games' share of profit or loss under the equity method was nil in Paytm's consolidated profit and loss account for the financial year ended March 31, 2026. The company also noted that First Games' carrying value was also nil as of March 31, 2026. The original show-cause notice, issued on April 28, 2025, had proposed a GST liability of ₹5,712 crore, with interest and penalties payable separately, as reported by Business Standard.
According to Business Standard, shares of One 97 Communications Ltd ended at ₹1,715.00, up by ₹25.00, or 1.48%, on the BSE following the announcement. The stock movement reflects positive market sentiment toward the reduced GST liability and minimal financial impact assessment.
As reported by Business Standard, the order was issued under Section 74(9) of the Central Goods and Services Tax Act, 2017, and the corresponding provisions of the Uttar Pradesh Goods and Services Tax Act, 2017, read with Section 20 of the Integrated Goods and Services Tax Act, 2017. The demand relates to tax liability for the period from April 2018 to March 2023, with the penalty being equivalent to the tax amount, in addition to applicable interest. First Games is currently evaluating the appropriate course of action under the relevant statutory provisions following the revised order.
