Insight INDIA Legislation
Sherill Pal, Principal Associate at J. Sagar Associates
Sherill Pal is a Principal Associate at J. Sagar Associates and advises and assists clients in the gaming sectors on licensing, compliance and enforcement issues.
www.jsalaw.com
bengaluru@jsalaw.com
The gambling laws of India: Untangling the myriad of knots
Two States which provide licences specifically for online gaming, are Sikkim and Nagaland. As per the Sikkim On-line Gaming (Regulation) Rules, 2009 (“Sikkim Rules”), a list of prescribed games such as Roulette, Black Jack, Poker, Poker Dice, including sports betting, may be offered for online play after procuring a licence for the same from the Sikkim government.
Betting and gambling find mention in Schedule 7 of the Constitution of India, where both are listed as State subjects, giving individual States the power to legislate on the same. Hence, several States have separate legislations regulating gambling and betting. Tis being said, numerous judg`ments issued by courts of law in India, have over time, put in place, a common jurisprudence governing the topic of betting and gambling. Additionally, most State laws on the subject have adopted a similar approach in regulating gambling and betting.
Te Public Gambling Act, 1847 (“PG Act”) is a central legislation which provides a basis for most of the State specific gambling laws. While the PG Act does not specifically define gambling or its elements, Section 12 of the PG Act exempts its applicability to any game of skill, wherever played. Similarly, most State legislations do not apply to games which predominantly involve an element of skill.
Te distinction between a game of chance and a game of skill was analysed in the landmark judgement of the Supreme Court in K.R. Lakshmanan v. State of Tamil Nadu (AIR 1996 SC 1153). As per the judgment, the Supreme Court, while analysing Section 11 of the Tamil Nadu Gaming Act, 1930 (which is similar to Section 12 of the PG Act), Stated that a game of skill is one in which the element of skill dominates over the element of chance. Similarly, in the case of State of Andhra Pradesh v. K Satyanarayana (AIR 1968 SC 825), the Supreme Court held that rummy is a game of skill because the fall of the cards has to be memorized
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and the game requires considerable skill in holding and discarding cards. In another Supreme Court judgement of M J Sivani and Ors v. State of Karnataka (AIR 1995 SC 1770), the court Stated that it is not necessary to decide whether a game is of skill or chance, in terms of mathematical precision.
Based on the aforementioned cases, and several of the State legislations in relation to gambling and betting, it is possible to list out the two main elements required for any activity to be categorised as gambling or betting:
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Te element of placing a bet or a stake to take part in a particular game; and
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Te element of winning the game based on an uncertain event or chance instead of predominantly depending on skills.
While most of the aforementioned legislations
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