Gambling in India

Gambling in India

Gambling in India is under strict control except for a few categories like horse racing and lotteries. Gambling in India, being a state subject entitles the states to make formulate laws to govern such activities within their states. The Public Gambling Act, 1867 being a central law prohibits running or operating public gaming houses. Any violation of the law would attract a fine of Indian rupees of 200 or imprisonment of up to 3 months. 

There are different kinds of gambling in India that are prevalent and had been practiced in India in past many years i.e. Horse Racing, Lottery, Skill Games, Casino Gambling, Online Gambling and Sports betting. The legal position on gambling in India is divided into two broad categories i.e. games involving skill and games of chance.

Legal nod on Skill Games

Gambling in India is an act of putting money or betting for money or equivalent.  The Public Gambling Act, 1867 has clearly declared all such Gambling and betting acts illegal except games where skill is needed. 

The fact that interests the most would be definition of ‘Skill games’.  The Apex Court in India has defined Skill Games as, “The competitions where success depends on substantial degree of skill are not ‘gambling’ and despite there being an element of chance if a game is preponderantly a game of skill it would nevertheless be a game of mere skill.”

As per the given definition, it has been declared that Horse racing or Dog Racing includes substantial amount of skill and does not fall under the definition of gambling except under certain conditions. 

The above definition also allows the game of rummy which later was declared as ‘Game of Skill’ by Supreme Court. It doesn’t allow the game of ‘three cards’ as known as ‘flash’, ‘brag’ etc under this category as it is entirely a game of chance.

Indian Lottery laws

Government lotteries are governed under Central Lotteries (Regulation) Act, 1998. The Act authorizes State Governments to hold lotteries and to frame regulations that should not intervene with Central Lotteries Act. It restricts the drawing of Lotteries to one draw per week.

Grey Legality:  Most of our Indian States have given permission to open lottery terminals in abundance where draws take place every 15 minutes. Surprising isn’t it? Sikkim is one State which is popular for its gambling terminals and its own regulatory framework. The reason for not following the Central Lotteries Act is their constitutional right under Seventh Schedule, which allows them to create their own laws for all kinds of Gambling.

Legal Status on Casino Gambling

Casino Gambling is regulated by Public Gambling Act, 1867 and is outside the legal ambit of gambling. But, Indian Gamblers who prefer to play their luck in casinos can enjoy it in Sikkim and Goa. These 2 states are the only states, which have legalized Casino Gambling to a limited extent only under state approved license i.e. at five star Hotels. In Goa, it is also allowed on the board of an offshore vessel/ship.

Legal status on Online Gambling in India

Sikkim was the first state to legalize Internet Gambling. It is easy to obtain license for running an online gambling game from state government which includes license to run an organization, management or receipt bets. .  

Public Gambling Act, 1867 is an old Act and do not contain any regulations with regard to online/internet gambling. There are online betting agencies including bet365, Ladbrokes, Bet fair or William Hill that entice gamblers to place bets. Today, internet gambling is making wealth out of Internet Gambling. Due to lack of any servers, advertising or any concrete law in India, it is giving Indians an easy way to gamble on sports by use of e-wallet etc. It also includes IPL matches. 

In order to regulate and restrict online gambling in India, the Payment & Settlement Act, 2008 authorizes the Reserve Bank of India, to start or operate a payment system for regulation of all kinds of electronic payment mechanisms. FDI Policy has also restricted enterprises to involve in Lotteries, Gambling and Betting Activities. Also, we have IT (intermediary guidelines) Rules, 2011 to block access to prescribed types of websites and content.

All cyber activities or online gambling in India are regulated under the IT Act, 2000. The act prohibits online gambling activities and prescribes a punishment for persons indulging in such activities, would be fined Indian Rupees 100,000 or would receive imprisonment of up to 5 years.

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