Angappan Rama Shankar Vs ITO (ITAT Chennai)
Online gaming winnings addition remanded – Gross receipts taxed without verifying buy-in losses; fresh examination directed – ITAT Chennai
In Angappan Rama Shankar vs ITO (A.Y. 2022-23), the AO added entire gross winnings of ₹99.25 lakh from an online gaming portal as income, holding that losses cannot be set off against lottery winnings. The CIT(A) confirmed the addition ex-parte.
Before the Tribunal, the assessee contended that only net winnings should be taxed after considering “buy-in” amounts and gaming expenses. The ITAT observed that lower authorities relied solely on the statement received from the gaming company and ignored the loss computation reflected in the account statement .
Considering principles of natural justice and the need to examine the nature of online gaming transactions, the Tribunal set aside the orders and restored the issue to the AO for fresh verification of actual winnings after providing adequate opportunity to the assessee. The appeal was allowed for statistical purposes.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
This appeal by the assessee is against the order of the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi, (in short “CIT(A)”) passed u/s. 250 of the Income Tax Act, 1961 (in short “the Act”) dated 30.10.2025 for Assessment Year (AY) 2022-23.
