Game of Chance or Game of Skill; how Gambling is regulated in India?

Policharcha.com | Updated: October 21, 2020, 4:59 IST

How gambling is regulated in India. Gambling laws in India, How is Dream 11 leagal?

“Yeh main kar leta hu, aap Dream 11 per team bana lo” is one of the most heard and watched catchphrases on the internet since the advent of the thirteenth edition of the Indian Premier League. However, considering that gambling and betting is illegal in India, one might question how apps like Dream 11, and MyTeam11, which involve making a fantasy team to earn some money rewards, and sites which offer online Poker, and Rummy are operating in India. One might also argue whether these avenues are used as proxies for online betting.

Gambling is generally considered a taboo from the viewpoint of Indian culture and values. The Hindu epic Mahabharata provides a classic example of what playing a simple dice game can lead to. Even according to the Islamic ideology, gambling is seen to be an addictive practice which can destroy personal lives and family values. If Indian values abhor so much the acts of gambling, then how come Dream 11 can be the title sponsor of IPL, or how can a person place bets on horse races in our country?

To get more clarity on the subject, we will have to look at the prevalent laws in India which deal with betting and gambling.

How gambling is regulated in India

Gambling laws in India.

Betting and Gambling is administered under the British-era law known as The Public Gambling Act, 1867. This Act prohibits gambling in public forum in India, and prescribes punishment for those who run such places. Some states have adopted this central Act, while others have taken matter into their own hands, and have made laws regarding the same. Betting and gambling is a state subject listed in the Seventh Schedule of the Indian Constitution.

The Gambling Act, however, distinguishes between a ‘game of chance’, and a ‘game of skill’. While the former is prohibited under the Act, the latter is allowed, and is regulated by the concerned departments. Even most of the states’ anti-gambling laws exempt these games of skill from their purview. However, as per the Supreme Court of India, the ‘skill factor’ must outweigh the ‘chance factor’ for one game/sport to be called a game of skill.

Goa and Sikkim are the only states where gambling is legal. Casinos can be opened after getting an authorised license by the State Governments.

In West Bengal, Poker, Rummy and Bridge are excluded from the definition of gambling. In Andhra Pradesh, online gambling is completely illegal, and can lead to jail terms, however fantasy games are permissible. Assam, Odisha, and Telangana have made it illegal to play game of skill for money. Therefore, no type of betting is allowed.

It is to be clear that except the states of Goa and Sikkim, betting and gambling is indeed illegal and punishable crimes in India.

Different gambling laws in different states.

Poker is a major grey area in the eyes of Indian law. Teen Patti (Flash) is banned, whereas Rummy is allowed. It is interesting to know that horse racing, which is one of the easiest games to fix, is legal to wager on because it is a skill game, yet cricket betting which requires the some sort of skill set is banned.

Dream 11: A game of skill or a game of chance?

Dream 11, MyTeam11, and other fantasy games are online competitions where you choose a number of players to form a team (let’s say a cricket team). This team of yours is then ranked following the real match involving those players and based on their real performances. If the players who starred in the actual game were on your team, then your team ranks higher, and you become entitled to a sum of prize money or a share of it.

Several High Courts in India have categorised these fantasy games as a game of skill on the basis on the following:-

  • Participants have to choose a team consisting of at least the same no. of players as playing in a real-life sports team (e.g. 5 in basketball, 7 in kabaddi and 11 in cricket/football)
  • All contests are run for at least the duration of one full sports match
  • No team changes are allowed by participants after the start of the sports match

Moreover, one has to be well informed about the status of the teams, playing form of several players, weather conditions, pitch and ground conditions, and several other things. So, indeed one must show some skill to increase his chances of winning.

Counter Arguments

Now, how would you know before a match, which player is going to shine? Is it not predicting or guessing or speculating? Is it really a ‘game of skill’ as they say? Is this really not a ‘game of chance’ because no matter which sort of expert one is, the reality is that nobody actually knows who might hit how many runs or take how many wickets the next day? 

Only if it takes some efforts to make a guess, then should it not be considered betting at all? The idea of distinguishing games/sports based on their requirement of ‘luck/chance’ or ‘skill’ is paradoxical, but then what is more intriguing is the fact that these phrases have been produced by the courts of law. 

Several judgments by some of the High Courts and the Supreme Court of India have made internet games like Poker, Rummy and Bridge, and fantasy sports like Dream 11 legal in India.

These judgments do not make gambling legal, but subjectively take some games out of its ambit. This is how Dream 11 have not only survived, but also thrived in the Indian market as it is understood to be a ‘game of skill’.

Internet Gambling

Sikkim has enacted the Sikkim Online Gaming (Regulation) Act, 2008, with a twofold objective of controlling and regulating online gaming through electronic and non-electronic formats, and to impose tax on the same. 

The above mentioned Act was amended in 2015 restricting the offering of "online games and sports games" under the licenses issued under the said Act to the physical premises of the game parlours within the geographical boundaries of the State of Sikkim through intranet gaming terminals. Initially, the phrasing of the Sikkim Online Gaming (Regulation) Act, 2008 provided that the license shall allow the licensee to offer its games across India without restricting it to the territory of Sikkim.

Nagaland has enacted the Nagaland Prohibition of Gaming and Promotion and Regulation of Online Games of Skill Act, 2016. The said Act provides for promotion and regulation of ‘games of skill’ through the issuance of licenses by the State Government. This Act says that the license holders can operate from any State in India where gambling is allowed.

Except for the Sikkim Online Gaming (Regulation) Act, 2008 and Nagaland Prohibition of Gaming and Promotion and Regulation of Online Games of Skill Act, 2016, no other Central or State gambling legislation specifically deals with online gambling which puts online gambling involving a 'game of skill' in a spot of bother.

In the present global world in which everyone is connected through the internet, a person sitting in India can bet through a foreign owned website. There is no law which exclusively regulates/prohibits such activities in India. In the absence of any specific law directly regulating the online gambling through a server located outside the territory of India, these can be regulated only through the Information Technology Act, 2000, and the prevalent laws which pertain to foreign exchange earnings and money laundering.

Conclusion

From a societal and cultural perspective, it completely depends upon a person how he understands or exercises gambling. One can do gambling through online games or at offline platforms for fun, and it could actually be relaxing and mood refreshing. However, if one engages in gambling more than what is good, then it can also lead to loss of possessions, anxiety, frustration, quarrels, depression, alcoholism, suicidal tendencies, crimes, and so much more. It is perhaps because of these fearful consequences that our societies, from past times, have made rules to keep us stay away from gambling.

However, gambling is not a standalone issue here; the issue is how gambling is regulated. Gambling is still seen as a taboo, and apparently this assertion has been carried forward by modern nation states who care for their society and citizens, even though these states are fully aware that legalising gambling would also bring rapid economic growth, and job opportunities, but that is altogether a different issue which needs a proper discourse.

Anyway, what are your views on the debate of ‘game of chance’ vs ‘game of skill’? Let us know in comments.