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WHAT’S BREWING FOR THE INDIAN GAMING INDUSTRY? Ranjana Adhikari & Shashi Shekhar Misra , Partner and Associate at IndusLaw respectively, offer a round-up of the latest regulatory updates in the Indian gaming market 1
Littérateurs have often referred to India as a land of dichotomies. The current legal landscape that is visible in India as regards gaming and gambling is a case in point. On the one hand, while the courts are slowly and rightly affirming the constitutional legitimacy of the industry through a purely legal lens, there is on the other hand a constant litany of litigations calling for restrictions and prohibitions on gaming, based largely on their moral view and sensibilities. Though legal developments over the past few months have been positive for the industry, there is also the nagging worry whether countering such frivolous petitions could end up being a Sisyphean task. In this article, we provide a brief roundup of some recent cases and the legislative efforts of certain states in India, which are of relevance and interest to the world gaming community. 1. CHALLENGE TO THE LEGISLATIVE COMPETENCE OF STATES TO REGULATE OR PROHIBIT SKILL-GAMING: MADRAS HIGH COURT PAVES THE WAY In a significant judgement2 delivered in the first week of August, the Madras High Court (“Madras HC”) held that the blanket ban imposed by the state of Tamil Nadu on all forms of gaming, when played for stakes, is unconstitutional3 and thereby struck down the impugned amendments 4 to the Tamil Nadu Gaming Act, 1930 in their entirety. The judgement also attempts to set out clarity on the issue of the legislative competence5 of the state's vis-à-vis skill games. The Madras HC held the amendments to be manifestly arbitrary, disproportionate to the objects they set out to achieve and failing the ‘least intrusive’ measure test. The Madras HC agreed with the contention
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be read so as to provide the state with betting as a separate legislative head. However, with a new State Government with a different political affiliation now at the helm in Tamil Nadu, the state is once again considering yet another law to ban online rummy and poker for stakes, despite the Madras HC quashing the previous amendments (as discussed above)6. It is anticipated that post the Madras HC verdict, the state would have to pass the muster of the tests identified by the court - i.e. the law should be proportionate to its objects, should be based on proper background research and empirical evidence; and should pass the ‘least intrusive’ measure test if impinging upon a fundamental right.
Ranjana Adhikari of the petitioners that the legislative competence of the State, under the legislative head of “betting and gambling,” cannot be enlarged so as to include within it the power to legislate on games of skill; but observed that the State could, however, reasonably claim such competence under other heads of legislation available to it such as ‘public order;’ ‘trade and commerce within the state;’ or ‘sports, entertainment, amusements;’ provided it could justify the need for such a law and the extent thereof. The Madras HC made it amply clear that the legislative head of “betting and gambling” has to be read as empowering the State Government to only legislate on betting related to gambling, which in turn meant betting on games of chance, and should not
2. REAFFIRMATION OF FANTASY SPORTS AS A GAME OF SKILL The fantasy sports industry in India, and Dream11 in particular, celebrated some key orders recently. By way of background, Dream11 is one of the most successful fantasy sports operators in India and a unicorn within this sunrise industry. Over the years, there have been a number of public interest litigations in which the legality of the Dream11 format came into question. In July of this year, the High Court of the state of Rajasthan (“Rajasthan HC”) rejected a writ petition 7 filed by a private citizen which had, inter alia, sought regulation or prohibition of online fantasy games played for stakes. The Rajasthan HC, relying on earlier judgments8 on the issue, rejected the petition and held that offering of online fantasy sports in accordance with self-regulation guidelines of the industry body, Federation of Indian Fantasy Sports (FIFS), had already been judicially recognised as a game of skill; and hence a legitimate
