Digital Age Is De Facto But What Is De Jure Position Of Gaming In It
Author: LawSphereX
Category: Technology, Cyber & Privacy
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DIGITAL AGE IS DE FACTO BUT WHAT IS DE JURE
POSITION OF GAMING IN IT?
Mansi Maheshwari, LL.M [Intellectual Property Rights], Christ (Deemed To Be University), Bengaluru, Karnataka
ABSTRACT
The Indian gaming industry has evolved from a niche activity to a significant economic sector. The introduction of PC and console gaming in the early 2000s, with titles like Call of Duty and GTA Vice City, attracted millions of players. This growth accelerated in the mid-2000s with the rise of online gaming platforms and the accessibility of mobile technology, which enabled broader engagement across demographics. Today, gaming is a global industry valued at $221. 6 billion in 2023, with India contributing $3. 1 billion in FY-23 and projected to reach $7. 5 billion by FY-28. Significant milestones, such as the inclusion of esports as a medal event in the 2023 Asian Games, demonstrate India’s rising prominence in competitive gaming. While the industry’s growth is remarkable, it presents challenges.
Gaming addiction has become a pressing issue, with instances of extreme behaviour linked to excessive gameplay. The pandemic exacerbated this trend, with gaming app usage increasing by 200% and engagement rising by 75,000 new users during lockdowns. Additionally, the intersection of gaming and gambling raises legal and ethical questions, particularly in differentiating "games of skill" from "games of chance. " Cases like Dream11 and Texas Hold’em Poker have highlighted the ambiguity in legal interpretations. India’s regulatory framework remains fragmented, with outdated laws like the Public Gambling Act of 1867 and state-specific regulations providing limited oversight. Incidents like the banning of PUBG underline the need for comprehensive gaming laws addressing intellectual property, addiction, and ethical practices.
A robust legal framework is crucial to balancing innovation with societal welfare. By fostering a safe, fair, and inclusive gaming ecosystem, India can ensure sustainable growth while addressing the challenges posed by this dynamic industry. The sector holds immense potential to contribute to the economy and reshape digital culture globally. Keywords: online gaming, gambling, game of skill vs game of chance, regulatory framework, pandemic
Introduction Prior to the emergence of online gaming penetrating Indian society as a remunerative market, physical gaming was more prevalent. In the past, video games were frowned upon in India as they were always associated with a past-time activity and were not considered a profitgenerating market the emergence of the gaming law began in the early 2000s when the gaming consoles and PC gaming was introduced and gave a boom to the gaming industry, as it introduced different classes of people to the new dimension of gaming industry. PC gaming like ‘Call of Duty, Counter-Strike, GTA Vice City’ was themed on the grounds of action and thereby captivated the young males to access the game on PC with the help of an internet connection. However, the mid-2000s gave a different vertical to gaming by introducing ‘online gaming platforms.
’ A large percentage of Indians of different groups started learning and sharing these games with the advent of social media platforms. Games such as ‘Farmville’ and ‘Mafia Wars’ was made available on Facebook. As the people of this techno-savvy world have now entered in an era where to commemorate winning we have one more phrase; ‘winnerwinner chicken dinner. ’ The technological world has curated one of the most addictive ways of defying the concept of indoor and outdoor games and providing the same experience by just sitting on a chair and having a keypad and a mike at home. This notion of online or mobile gaming cannot be termed of recent origin, we can easily recollect the times of the Nokia 1100 (i. e. initial phase of cybernetic society) where people were discerned to have unprecedented interest in the infamous ‘Snake Game’ and computer games like ‘Pin Ball’.
But today, the word ‘Gaming’ has not just remained a concept to extirpate boredom but has taken the form of an industry. This industry, which now has a market value of US $221. 6 billion in 2023 and is predicted to expand at a rate of 8. 74% between 2024 to 2032 in the overall worldwide economy. While speaking about India, being the second largest user of the internet, FY-23 have shown awestruck growth in the gaming industry by generating revenue of 3. 1 billion USD and is anticipated to reach a height of 7. 5 billion USD by FY-28. An upsurge in the Indian Gaming industry has been witnessed since lockdown in the year 2020, a game called ‘Ludo King, became a popular way to pass time in lockdown for many and thereby generated revenue of 20 million USD in the same year. An average growth of 27% has been reported every year in the Indian gaming industry.
In the year 2022, individuals with a fervent interest in gaming and esports encountered an extraordinarily exhilarating period, characterized by the unprecedented Commonwealth Esports Championship. The international acknowledgment of e-sports attained unprecedented levels, as illustrated by the commendable accomplishment of the Indian DOTA
2 team in securing a bronze medal. In a continuation of this momentum, the Asian Games 2023
incorporated an esports category as an officially sanctioned medal event. The integration of online gaming into the realm of competitive sports underscores the growing importance of gaming and e-sports on the global stage. In the context of India, the online gaming sector constitutes the fourth largest segment within the Indian Media and Entertainment landscape, with projections indicating it will attain a valuation of INR 231 billion by the year 2025, reflecting a compound annual growth rate (CAGR) of 20%. As of 2023, the population of online gamers in India has surged to an impressive 442 million, signifying an extraordinary expansion that positions it as the secondlargest gaming user demographic worldwide, second only to China. Among this population, an estimated 90 to 100 million individuals are categorized as enthusiastic and consistent participants in gaming activities.
Within the domain of e-sports, the total number of competitors reached 1 million across various levels of competitive gaming, with women representing one in five of these participants. Regulations on Online Gaming Any subject matter which raises the concern of societal order must be regulated by relevant laws and regulations. But as far as we talk about India’s stringent law and its regulatory bodies there are no such specific legal regimes which are enshrined to oversee the operation of gaming in India. Making it an exception the Indian Legislature has always been receptive and taking the rising controversial debate upon the gaming laws into account.
The legislature has provided certain provisions where such matters in question on gaming are safeguarded under the vide Indian Penal Code, 1860 and Information Technology Act, 2000 (IT Act, 2000) In the most recent vexed question before the Indian judiciary on the Sovereignty and Integrity of India, a Chinese-built app PUBG which held a prominent position in the Indian gaming market was banned on 02/09/2022 by upholding Section 69A of the IT Act, 2000. And, therefore, the notable Section 69A of the IT Act, 2000 is empowered to issue directions for blocking any public access through any computer resource. 1 1 https://www. indiacode. nic. in/showdata? abv=CEN&statehandle=123456789/1362&actid=AC_CEN_45_76_00001_200021_1517807324077&sec tionId=13097§ionno=69&orderno=88&orgactid=AC_CEN_45_76_00001_200021_1517807324077
Gambling: a boon or a bane? Gambling has been a pervasive activity throughout human history, and when we examine ancient Hindu mythology, specifically the ‘MAHABHARATA,’ its significance in the context of gambling becomes evident. In this epic narrative, the Pandavas and Kauravas partook in a high-stakes wagering contest, which ultimately precipitated the decline of the Pandavas dynasty, resulting in their exile for a duration of thirteen years from their sovereign dominion. The annals of history serve as a testament to the devastating ramifications of gambling, exemplified by the incident where the Pandavas staked their wife, leading to her public humiliation before the assembly. It is apparent that gambling has deep-rooted origins in our ancestral heritage and has subsequently evolved into a digital phenomenon.
Regulations on gambling During the Colonial Era ‘The Public Gambling Act, 1867’ was enacted which regulated and controlled Gambling the PGA focused on punishing public gambling and keeping common gaming houses. Whereas, Section 12 of the PGA explicitly states that, the restrictions contained therein shall not apply to any game of mere skill2. Post- Independence by virtue of Article 19 (1) (g) of the Constitution of India confers upon every citizen of India the freedom to practice any profession, or to carry on any occupation, trade or business condition being that the subject – matter of that trade, profession or business is legal. The aspect of gambling is incorporated in List-II (State List), Entry 34 and 62 of the Seventh Schedule which empowered the State(s) to enact their laws3. Different approaches are taken into consideration by various States in relation to Gaming.
State of Goa The Goa, Daman and Diu Public Gambling Act, 1976 (“1976 Act”), took the approach to provide for punishment for public gambling and the keeping of common gaming houses in the Union territory of Goa, Daman and Diu. However, Goa is one of only two State legislations that permits casinos and other games of chance. The Goa Legislative Assembly by amending the 1976 Act added Section 13A, which allows the State Government to authorize games of
2 https://www.indiacode.nic.in/bitstream/123456789/2269/1/AAA1867____03.pdf
3 https://legislative.gov.in/constitution-of-india/
“electronic amusement/slot machines in Five Star Hotels” and “such table games and gaming on board in vessels offshore as may be notified”. 4 State of Sikkim In the year 2008, the Sikkim State Legislative Assembly enacted the Sikkim Online Gaming (Regulation) Act, 2008, which became effective on 1 July 2009 the Act rendered online sports betting within the State of Sikkim as lawful, contingent upon the operator shall possess a license issued by the Government of Sikkim. Consequently, Sikkim stands as the sole State in India that authorizes online sports betting via websites whose servers are located within Sikkim.
Despite the fact that the State of Sikkim has legalized online sports betting, a contentious issue arises regarding whether this initiative may be influenced by the stipulations outlined in the Information Technology Act, 2000 and its associated Rules, which constitute central legislation that prohibits the dissemination of any information online that could pertain to or promote gambling activities. 5 Intertwining elements between Gaming and Gambling As with the pace of time online gaming platforms are rising at an exponential rate, and an emerging question came into the picture as to which category of gaming/gambling will fall under the Game of Skill and Game of Chance. Various High Courts and also the Supreme Court have laid down the parameters as a yardstick to analyze whether gaming falls under the Game of Skill or not.
(a) the game should involve substantial skills such as strategizing in the game or where the user’s prudence is required in the virtual model such as selecting the team or deploying the player to play a game virtually. (b) such a game should primarily depend upon the knowledge and experience of the player/user. (c) an enhanced level of experience and specialized training in this particular game is anticipated to furnish the player with a more profound comprehension of successful strategies
4 Gaming-Laws-In-India.pdf
5 ID Note 4
and an elevated awareness of the intricacies of the game's dynamics and operational limitations. 6 The Honorable Supreme Court under the case of Dr. K. R. Lakshmanan Vs. State of Tamil Nadu7, where it was opined that “one in which success depends primarily upon knowledge, training and experience of a person then such shall be constituted under Game of Skill”. Whereas, the Game of Chance can be elucidated as an outcome which is in limbo and is determined by playing cards, spinning wheel, roulette and rolling dice. For instance, a critically acclaimed television show ‘KAUN BANEGA CROREPATI’ has also designed an in-house app for viewers across the world through which a participant can secure a prize by way of money. The said example will be taken into account as a Game of Skill as it requires mental deliberation which is attributed to the participant’s skill and knowledge.
Game of skill v/s Game of chance These days along with cricket, people are fond of some mobile applications such as DREAM 11, MPL and others. Basically, people here invest certain amount of money in reference with players and teams of ongoing real-life cricket match and secure a certain amount of money whenever their team or player in real-life game wins. Most of the population across the country found this practice absurd and contrary to law as they were of the view that these applications are open for all and promotes gambling deliberately. However, the Indian Judiciary resolved this quandary in the case of Varun Gumber v/s UT of Chandigarh8 which decided the legality of DREAM11, where the petitioner contented to ban the application as it is an app for wagering and betting.
The Honorable Supreme Court provided the decision that those apps were beyond the ambit of the provisos of Public Gambling Act, 1867 and prescribed, sports played on those apps to be Fantasy Sports. By delineating the concept; The Supreme Court further provided that Fantasy sports are those whereby player with his skill after having due knowledge of the player’s past performance economy and other factors selects in his virtual team and wins on the basis of performance by that respective player in real life ongoing game. And, therefore, is a game of skill and the Public Gambling Act, 1867 only prohibits those games in practice where the outcome is purely chance-based.
6 ID Note 4
7 Dr. K.R. Lakshmanan Vs. State of Tamil Nadu [1996] AIR 1153 SCC (2) 226 [India].
8 Varun Gumber v/s UT of Chandigarh [2017] CWP 7559 – 2017[India].
In Dominance Games Private Limited v. State of Gujarat 9the High Court of Gujarat ruled the game Texas Hold’em Poker to be a game of chance the Court opined that the history of Poker clearly suggests that it was a game of chance because if we take into consideration all the elements of poker it is noted that out of two stages of the poker, the first stage involves the distribution of cards. Now, it is to be seen that in the distribution of cards, no player has control over it. The next stage involves the opening of the cards and based on that betting is made. The court applied the test of ‘substantial degree of skill’ and opined that the skill will always prevail over the chance. A player who controls the game by way of his experience and training then such game shall be known game of skill.
In the instant case, the court did not find a substantial degree of skill and hence, held Texas Hold’em Poker to be purely a game of chance and not a game of skill. In M. J. Sivani v. State of Karnataka10, the Supreme Court stated that the games like Poker Double Up, blackjack and Pacman, are purely based on chance because the player has no control over the game. Such games are based irrespective of the player’s skill. And thereby, it shall come under the scope of the ‘game of chance’. In the case of the State of Andhra Pradesh vs. K. Satyanarayana11, the Hon'ble Supreme Court held that, "The "three card" game is purely based on game of chance. Rummy, on the other hand, requires a certain amount of skill because the distribution of the cards has to be memorised and this requires considerable skill in holding and discarding cards.
The court therefore opined that the game of Rummy is not completely based on chance but it also requires a proportionate amount od skills as well. In the case of Gurdeep Singh Sachar v. Union of India12, the legality of Dream11 was questioned. The petitioner urged that such a platform amounts to gambling and is in violation of Public Gambling Act, of 1867. The court observed and analysed that Dream11 is purely based on the game of skill because success depends solely on the user’s knowledge of sports. And therefore, such a platform shall exempt from gambling.
9 Dominance Games Pvt. Ltd., v. State of Gujarat [2018] 1 GLR 801 [India].
10 M. J. Sivani v. State of Karnataka [1995]6 SCC 289 [India].
11 State of Andhra Pradesh vs. K. Satyanarayana [1967] AIR 1968 SCC 825 [India].
12 Gurdeep Singh Sachar v. Union of India [2019] 75 GST 258 [Bombay].
State of Nagaland Nagaland is recognized as one of the more progressive States within the Indian Union, characterized by a distinctly innovative approach. The Nagaland Prohibition of Gambling and Promotion and Regulation of Online Games of Skill Act, 2015,13 delineates the framework governing this domain. Section 2(3) of the aforementioned Act articulates the definition of the term “games of skill,” encompassing all activities wherein skill predominates over chance, including scenarios where skill pertains to the strategic placement of wagers or bets, or where expertise is involved in team composition or the selection of virtual stocks based on analytical assessments, or where skill pertains to the execution of moves, whether through the application of physical or cognitive skill and acumen.
Schedule A of the 2015 Act enumerates a comprehensive range of games, including Chess, Poker, Rummy, Bridge, Nap, Auction, Virtual team selection games, and Virtual sport fantasy league games, all of which are classified as ‘games of skill’ within the context of the 2015 Act. Judiciary in Action The penetration of the gaming industry has raised significant concerns regarding mental health, behavioral pattern and addiction towards online gaming among minors. When all of these alarming concerns fell in the lap of the judiciary it urged to reverse it by introducing various guidelines or frameworks with the help of relevant case laws that were put forth before the judiciary. The judiciary has always been at the forefront when the subject- matter affects the population at large.
Similarly, in the current scenario, the judiciary played a pro-active role so as to curb these concerns arising out of online gaming. In the case of Sneha Kalita v/s Union of India14 the petitioner filed a writ petition to put an immediate ban on games such as ‘Blue Whale’ which was found to be detrimental to the lives of people participating in the game ‘Blue Whale’ which is an app which designed 50 steps that led the participants towards suicide. The bench opined that the platforms which completely brainwash a person and thereby result in suicide shall be condemned. Further, the apex court also directed to outspread the awareness among school children which were majorly affected 13https://www. indiacode. nic. in/bitstream/123456789/15162/1/the_nagaland_prohibition_of_gambling_and_pro motion_and_regulation_of_online_games_of_skill_act_2015. pdf
14 Sneha Kalita v/s Union of India [2017] WP (C) 943/2017 [India].
by the game. In the case of All India Gaming Federation v. State of Tamil Nadu15, the State voiced its apprehensions regarding the adverse effects online gaming has on the psychological and physical well-being of the people, especially minors who are under 18 years of age. The Court admitted that even though public health falls under the domain of the State Government, it is still crucial for the Government to take proper regulatory measures rather than an outright ban on all online games. The State is, therefore, empowered to oversee and regulate online gaming by putting in place prudent measures, such as restrictions on playing duration, age of participants, and financial limits.
V. Gaming Can Also Lead To Jeopardy
The upsurge of digital games can be defined as any game that is played electronically. Last year, the Ministry of Education sent out an advisory in which it said, “Playing online games leads to a serious gaming addiction which has been considered as a gaming disorder” The American Psychological Association defines the Internet gaming disorder as a syndrome in which one experiences a loss of interest in social activities, education which attracts to anxiety, guilt, depression or sometimes even leads to suicidal thoughts16. The consumption of gaming was excessively used especially during the pandemic when everyone was forced to remain indoors.
Then there was a proliferation in the number of gaming app downloads across India, and there was a considerable shift from single-player models to multi-player models it reported there was an increase in user base by 200 per cent during the pandemic and also saw engagement of 75,000 new users. The models introduced the gamers to new and challenging levels which attracted the consumer's attention17. Engaging in online gaming without any constraints or self-imposed limitations often results in numerous players developing addictive behaviors, ultimately culminating in a formal diagnosis of gaming disorder. An inference to this fact can be drawn from an infamous PUBG – Murder case. Where a 16year-old boy named ‘SPARSH UPADHYAY’ shot his mother dead with his father’s licensed pistol only for the mere reason that his mother refused to provide funds which required him to
15 All India Gaming Federation v. State of Tamil Nadu [2023] SCC OnLine Mad 6973 [Madras].
16 How video gaming addiction is impacting mental health of youngsters in India - Wockhardt
17 ID note 16
upgrade himself to the next level of the game18. Another such instance is where a 16-year-old male adolescent purportedly committed the act of strangling and subsequently killing his 12year-old relative in Nagpur as a means to settle financial obligations that accrued from engaging in online gaming. The 16-year-old did such an act by creating a fake ID and demanding a ransom of ₹5 lakhs for the release of his child. 19 Another instance of online gaming addiction can be seen when a man from Uttar Pradesh murdered his mother so that he could claim his mother’s life insurance to pay off his debts for online gaming and dispose of her body in the Yamuna River bank. 20 From this, a picture can be drawn that every big picture has its ostensible dimension and so is the case with gaming.
On one hand, it can be paramount for the forthcoming digitized economic revolution inversely it has its equal gloomy repercussions The sector of online gaming encounters a multitude of challenges that necessitate both critical examination and preemptive measures. The subsequent section will engage in a discourse regarding the current legislative framework that pertains to these matters. Bharatiya Nyaya Sanhitha The BNS deals with criminal offences in India. Such legislation can be brought into light with online gaming law when a game which is introduced induces hatred within religious groups, promotes enmity between different groups or causes abetment to suicide. One such instance can be drawn from an infamous game ‘Blue Whale Challenge’.
The game led to the suicide of thousands of players and was later declared as an abetment to suicide by the Ministry of Electronics and Information Technology in India. 21 Prize Competition Act and Lotteries Act The Prize Competition Act was enacted with the aim of regulating and controlling competitions The subject matter of this regulation also falls within gambling and betting under entry thirty- 18 https://www. livelaw. in/high-court/allahabad-high-court/allahabad-high-court-grants-bail-juvenile-accusedkilling-mother-lucknow-pubg-murder-case-227647
19 Boy, 16, Kills Cousin To Pay Off Debts In Rajasthan
20 UP Man Borrows Money For Online Gaming, Kills Mother In Payback Plan: Cops
21 Online Gaming Laws in India: An Analysis of the Legislative Intent Vis-À-Vis the Future Roadmap
four of List II of Schedule VII. It is evident that prize has become a primary part of online gaming and therefore, relevant provisions of the said Act can be invoked in any case. 22 Intellectual Property Rights The Intellectual Property Rights aims to protect and preserve the rights of the creator. Online gaming can attract various provisions of Intellectual Property Rights because to make a game appealing so that it would come into the public eye, various elements are created such as avatars, the plot of the game the music and so forth. All these instances can be protected under the umbrella of Intellectual Property Rights under the Trademark Act and Copyright Act. 23 Digital Personal Data Protection Act The Act aims to protect the personal data of the citizens that is processed in India.
The Act will be applicable to online gaming because online gaming platforms collects the user’s personal data such as his name, age, country, e-mail address, date of birth and plastic card numbers that is debit or credit card for the purpose of billing during in-app purchases. Therefore, as online gaming has gained such extensive popularity among the Indian populace, it is very necessary that the information about Indian gamers should be protected and treated in accordance with prevalent legal legislations. And shall be in accordance with the new data protection law for India Conclusion Indian legislature has always remained an epitome of dynamism and receptiveness to newer developments of the society and always has made endeavors to regulate evils which came at the cost of development.
However, Digital age being still in its budding stage has created challenges in each and every sector. Not having specified laws for gaming undoubtedly have provided various offenders a free hand to easily twist the existing regulations. Apart from hardened criminals, youth and children are becoming addicted to those games at an alarming rate and therefore an urgent need for children and youth-centric gaming laws should be taken into consideration by the legislature and shall take prompt action on the issue.
22 Supra note 18
23 Supra note 18