Online Gambling Vis-A-Vis The Law Relating To Prevention Of Gambling In India - A Critical Study
Author: LawSphereX
Category: Technology, Cyber & Privacy
Published:
Updated:
ONLINE GAMBLING VIS-A- VIS THE LAW RELATING TO
PREVENTION OF GAMBLING IN INDIA: A CRITICAL
STUDY
Dr. Kashinath S. Neharkar, Assistant Professor, Shri Shivaji Law College, Parbhani
ABSTRACT
This an era of information and technology with the help of internet. The internet and allied platforms are used for providing platforms for online gambling. The gambling in India is regulated by centrally enacted The Public Gambling Act 1867. It declares operating gambling in public places as illegal. It further declares participation in gambling activities in such place as illegal. The state Governments also have enacted some laws to regulate gambling in their respective territory. But there is no uniformity in regulation of gambling activities. The online games and gambling through such games is gray area for online gambling platform provides and gambling players. The games like ludo, teen Patti, rummy is used for playing gambling whether with online cash or physical cash.
This is an attempt by researcher to discuss and focus on the online gambling, various tactics used for gambling and inadequacy of present laws to regulate such gambling in general. The research explored the concept of gambling, the types of new form of gambling and recent development. This is an attempt by researcher to examine legal and social implications of online gambling. Then the research explores the comparative legal framework at international level. The research also explores legal framework in India to regulate the gambling in changed circumstances. The research further focuses on application of existing legal frame work to online gambling. The research further focuses on need of special legislation to cope up the problems that resulted due to new form of gambling. This research will provide insight to researcher to conduct research on specific online gambling.
The suggestions in this research may help Government to bring special legislation to regulate gambling in changed scenario. The researcher used doctrinal research method to study the problem. Keywords: Online, Gambling, Law, Prevention, Games, etc.
Introduction: The 21st century is known for revolution in information, communication and technology. The world became global village. The internet and online platform played vital role in bringing transformation in various spheres of human endeavors such as education, commerce, business, communication and entertainment. The all-global activities can be performed at the tip of finger. The online platforms helped to communicate faster than old ways of communication. It allows peoples to reach any person within few seconds and share the ideas by face-to-face meeting. The concept of gambling prior to revolution of information, communication and technology revolution was in the form of physical act of gambling. The operator of gambling activities was required to have specific place for it. The person willing to indulge in gambling was to visit the place and commit the act.
The place was easily traceable to authorities to regulate and prevention the gambling. The laws were enacted by considering the scope and nature of gambling activities. Recently with the revolutions of information and communication technology the online gambling industry is evolved boundlessly. The smartphones enabled the such gambling operators to reach easily to youth and old all over the globe. There are thousands of online platforms and games which are facilitating online games. The millions of people use such platform without ant restriction and losing property and lives in case of stress caused due to eat. The laws and efforts taken by Governments are resulting insufficient to handle the situation. Therefore, there is need of an hour to tackle the problem to save the future of nation.
Significance of Study: The gambling especially the gambling through online games and platform became popular peoples specially youth in India as entertainment as well as earning device. The online frauds and cheating are not new and became common phenomenon. The online gambling platforms and games are not remained as untouched from it. The youth in India is becoming addicted of online games like ludo, rummy etc. The present study is aimed at identification of gray areas of online gambling used to gambling activities. The laws are enacted became outdated to handle the situation. Therefore, there is need to address the problem of online gambling to save youth from addiction of gambling.
Review of Literature: The online gambling is recent phenomenon which is played with the help of internet. The academic discussion on problems and perspectives resulting from online gambling are yet neglected aspect. Followings are the literature available on online gambling to establish its connections with recent problems created by online gambling. Arjun Maheshwari in his article Online Gaming, Casinos and Fantasy Sports- An Overview of Gambling Laws1 published on Manu Patra website expressed need of proper regulation laws to ensure fair experience of online gaming. Sanju George, Richard Velleman, and Benedict Weobong, in their joint article Should Gambling Be Legalized in India2? , analyzed the arguments against and for the legalization of gambling in India. The same issues can arise for online gambling also. M.
Athivijayakumaran and Aswathy Rajan in their co-authored paper published online at
researchgate.net, expressed the concern over misuse of online gambling for by criminals for transfer of fund. Objectives of Study:
1. To examine the concept of online games and gambling.
2. To examine social and legal implication of online gambling.
3. To examine adequacy of present legal framework for regulation and prevention of
online gambling.
4. To explore the scope for enactment of new legislation.
Hypothesis of Study:
1. The present legal framework for prevention of online gambling is inadequate.
1 https://articles.manupatra.com/article-details/ONLINE-GAMING-CASINOS-AND-FANTASY-SPORTS-AN-
OVERVIEW-OF-GAMBLING-LAWS Accessed on 27th August 2023
2 https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8313460/ Accessed on 27th August 2023
2. The regulation of online gambling requires special enactment.
Research Methodology: The research methodology plays vital role in conduct of systematic and rightful research. It helps researcher to make roadmap to complete the research. The researcher has adopted doctrinal research method to conduct the present study. The researcher referred the literature and data from secondary sources such as library, websites to get proper information. The researcher referred the online books and journals published as National as well as international platform. The researcher further took help of supreme court and high court decisions to clarify and understand the regulation and prevention of gambling. In brief the researcher referred literature in the form of books, news, views and articles published on subject. Result and Discussion: Concept of Gambling The great war Hindu Epic Mahabharata is outcome of Gambling between Pandavas and Kauravas.
The dice game which was a gambling game played role of catalyst to the incident where in Pandavas Lost their kingdom, wealth, their wife Draupadi and themselves also. This is well-known example of gambling, its nature and its consequences. The Gambling is a game of chance. It is act of betting or wagering on the event which is uncertain. According to Merriam Webster Dictionary gambling is the practice or activity of betting: the practice of risking money or other stakes in a game or bet3. The gain in such act is dependent on uncertainty. The person involved in gambling may lose his money and property. Types of Gambling: There are various types of gambling prevalent in society. Card Games: Card game is popular game in India. The rummy, teen Patti and Andar Bahar are the types of gambling played with help of cards.
The Dice: The Dice is another form of game where a square like dice with numbers on its all
3 https://www.merriam-webster.com/dictionary/gambling Accessed on 29 August 2023.
sides is used for gambling. The winner shall anticipate the number for winning. All players except lose their money or property. Animal fights: There is organization of animal fights such as fight of cocks, bullocks, ram. The gamblers use to stake their money anticipating winner animal in fight. Such fights have been banned now. Betting on Horse race: Betting on horse race is also popular gambling among wealthy peoples. It is similar like animal fight. The gambler stakes his money on anticipating winner of the race. Sport Betting: The sport betting is based on sport matches played at domestic, national and international level. The sports like cricket, football, hokey, kabaddi is popular game in India which provided gray area for gambling in India. Gambling on Election Results: The election result is another event used for gambling purpose.
This is betting on probable results of elections. The players bet their money on predicted winners of elections of in constituencies etc. The above-mentioned practices of gambling are played physical involvement of player. New online platforms for gaming: Online game or Gambling: The development of information and communication technology opened new horizons of gambling. The online gambling is emerged as popular tool of gambling among techno-savvy players including men, women and youth in India. There are so many advertisements appealing to play online games such as teen Patti, ludo, rummy etc. The online gambling is easiest way for players without exposure of physical involvement. The online banking facility of such game allow player to deposit the amount in account and withdraw it hassle-free.
Various types of online games as gambling: There are number of online gambling platforms available through websites and applications. It is increasing leaps and bounds every day. Followings are some popular online games that can be used for online gambling purpose: Rummy Circle4: This is online platform which provide for online card rummy games. Its player can play online cash games and tournaments. It provides various types of rummy games
4 https://www.rummycircle.com/ Accessed on 29 August 2023
like point rummy, pool rummy etc. The players can simply register and complete kyc and add money to play game. A23 online rummy cash games5: This is also online platform for rummy card game with other types of games like poker etc. The players can play it by registration through platform of apps on mobile. 10Cric6: The cricket is popular game in India. This is specialized planform for betting on cricket match betting, other sport betting. MPL7: It provides wide range of variety of games. The platform claims such games as skillbased games but still these games are used for gambling through puzzles, sport games like cricket, football etc. Unibet8: This platform provides facility for casino, sport betting and poker games. 1xBet: This is international gambling platform available for Indian player. It provides variety of casino game and sport betting.
Leo Vegas: This is also international gambling platform. It provides variety of gambling through casino and table games. This is list of some popular gambling platforms and not limited to it. Online Rummy: Gambling or Skill: There are lot of online rummy games available in India through websites and applications. There players and platforms often claim that rummy is not a gambling but it is game of skill. Ther fore there is confusion about nature of rummy game. There are many countries which consider rummy as skilled game rather than a gambling. The rummy game in India is considered as skilled game. The Supreme Court of India has declared rummy as skilled game as it requires logic, skill and memory and judgment skill for
5 https://www.a23.com/rummy/rummy-cash-games.html Accessed on 29 August 2023
6 https://www.10cric10.com/ Accessed on 29 August 2023
7 https://www.mpl.live/ Accessed on 29 August 2023
8 https://www.unibet.com/ Accessed on 29 August 2023
playing. The Supreme Court opined that the rummy winning is not purely based on game of chance9. This provided boost for development of rummy platforms in India. If this decision is made applicable to online rummy, it also can be termed as game of skill. Even though the rummy game is considered as skilled game but still there are chances to use it for gambling purpose. The cards are distributed randomly, but some player may get in hand rummy so that other players have to lose huge amount charges for participation in game. Therefore, there is need to reconsider the stance by Supreme Court of India. Social and Legal Implications of online gambling: The online gambling is popular among the players and there are thousands of peoples involved in it without knowing the social and legal implications of online gambling.
The following are some major social and legal implications of online gambling. Huge Economic Loss: The online gambling may result in huge economic loss. It is game of chance, therefore winning ratio in such game may uncertain. The person losing money in gambling makes more efforts to get such money by playing more and more. Consequently, he faces more loss than earnings by such players. According to news published on website of The Economics Times10 a techie working in software company lost 70 lakh rupees in online rummy. Addiction of online gambling: The playing of online gambling leads to addictions of gambling. According to Ahmed Zayed , M. D, Online gambling can stimulate the brain the same way alcohol and drugs do, but it can
also go undetected. This makes online gambling addiction a serious disorder11 .The player gets continuous access to game due to advancement of 24-hour playing facility available through apps. The player due to addiction of betting more and more amount to win more to compensate the lost amount in such game.
9 https://indiankanoon.org/doc/84963/ Accessed on 01 September 2023
10 https://economictimes.indiatimes.com/news/india/bengaluru-techie-who-lost-rs-70-lakh-in-online-gamblingreunites-with-wife-after-therapy/articleshow/101474957.cms?from=mdr Accessed on 01 September 2023
11 https://diamondrehabthailand.com/what-is-online-gambling-addiction/ Accessed on 01 September 2023
The addictions of online gambling may have severe consequences for the player and his family.. It may result in financial problems. It increases the debt of person. In certain circumstance, the player may lose his job due to negligence on duty due to more concern on online gambling. Psychological Disorder: The person involved in gambling activities may get associated with psychological disorder. The consistent losing of money and unsuccessful attempts to prevent the loss results in restlessness. The person may face the problems of mood disorder, anxiety. The person neglects toward the work or job, family etc. The player loosing huge amount in gambling may face the problem of depression. Stress and health Problem: The economic loss in gambling is inevitable. The economic loss result in stress, anxiety and depression.
The player neglects the health, the exercise and appetite due to continuous engagement in online gambling. The health expert recognizes stress as basic root of health problems. The problem relation to digestion, high blood pressure, headache, disease relating to eyes are few common health issues resulting from online gambling activity. According to Mental Health Organization, United Kingdom12 Gambling can cause low selfesteem, stress, anxiety and depression if gambling becomes a problem. An international Legal Framework for Prevention of online Gambling: The online gambling is widely spread activity and it is not limited to ant particular territory. It is an international phenomenon. The prevention of online gambling requires cooperation at international level. There is no stringent legal framework available at international level to handle the online gambling.
The United Nations Organization a capable body to regulate and prevent online gambling activities with cooperation of members States. Following are international instruments which can be used for regulation and prevention of online gambling. 12 https://www. mentalhealth. org. uk/explore-mental-health/a-z-topics/gambling-and-mental-health Accessed on
07 September 2023
United Nations Convention against Transnational Organized Crime and the Protocols Thereto13: This convention is entered to prevent the transnational organized crime. The online gambling can be declared as crime in all territories of member state. It will help to prevent money laundering activities through online gambling. United Nations Convention against Corruption14: The corruption is another common problem faced by most of countries. This convention also aims to tackle the problem of correction effected through various methods including online gambling. The online gambling and money transactions through such gambling can be declared as corruption. This will provide firm platform to take rigid actions against service providers of online gambling activities.
Financial Action Task Force15: This is international body responsible to develop the policies and regulations to prevent financing to terrorism and money laundering at international level. The role of Financial Action Task Force can be instrumental in making policy to combat the problems of online gambling. Apart from the above mentioned frame work the European union also prohibits the gambling by protections of consumers right against fraud online gaming and money laundering through online gaming activities. The law passed by United States of America as Unlawful Internet Gambling and laws passed by Australia and United Kingdom are some good examples for prevention of gambling through online platforms. Legal Framework in India for Prevention of Gambling in India and its Adequacy: The online gambling and its legality is a new and complex phenomenon in India.
The role of one state is different from state in prevention and combating gambling in India. There are some
13 https://www.unodc.org/documents/treaties/UNTOC/Publications/TOC%20Convention/TOCebook-e.pdf
Accessed on 07 September 2023
14 https://www.unodc.org/documents/treaties/UNCAC/Publications/Convention/08-50026_E.pdf Accessed on
07 September 2023
15 https://www.fatf-gafi.org/en/publications/Methodsandtrends/Vulnerabilitiesofcasinosandgamingsector.html Accessed on 17 September 2023
states like Sikkim which allow online lotteries etc. in India. The following are some legislations enacted for prevention of gambling in India The Public Gambling Act 186716: This is only fully devoted Act enacted to prohibit gambling activities in India. This Act prohibit the use of place for gambling purpose. The person found guilty of this offence is punished with fine and imprisonment. The Public Gambling Act is enacted in initial stages British rule. It was aimed to prohibit old forms of gambling in common places. The online gambling remains out of clutches of the present Act. The Information and Technology Act 200017: The enactment of the Information and Technology Act was enacted to meet with changes brought by emergence of information and communication technology with the aid of internet and computer.
The Act specifically deal with the cyber-crimes effected with the help of electronic transactions. The Act lacks specific provisions for prohibitions of online gambling but it is useful in prosecution of offender’s online fraud etc. The information Technology Act along with suitable amendments can be used to tackle the problems that are created by online gambling. There is no common understanding among States in India to prohibit online gambling. There are states like Sikkim and Goa which allow online gambling through online games etc. while States like Maharashtra and Gujrat imposed the ban of online gambling. Still there is no implementation. Income Tax Act 1961: The Income tax Act 1961 provides for Taxation on income. It includes all types of income including income received from online games and online gambling. The proposed section 16 https://www. indiacode. nic.
in/bitstream/123456789/2269/1/AAA1867____03. pdf Accessed on 07 September
17 https://www.indiacode.nic.in/bitstream/123456789/13116/1/it_act_2000_updated.pdf Accessed on 07
September 2023
115BBJ18 of the Income Tax Act provides that assesses income by way of winnings from any online game, lottery shall be taxed at the rate of 30% Judicial Approach on Prevention of Online Gambling: Judiciary plays vital role in interpretation of laws and it also play important role in settlement of disputes. The disputes relating to gambling and online gambling dealt by judiciary in various judicial pronouncement. The role of judiciary can be examined through following decisions. In State of Andhra Pradesh v. K. Satyanarayan19, The Supreme Court held that Game of rummy is not a game of chance but it is game of skill. But the Supreme Court of India held that three card game is game of chance. Therefore, it can come under gambling. The court in Dr. K. R. Lakshmanan v. State of Tamil Nadu20 , recognized that horses racing, As the game of skill.
Therefore, it was kept away from application of The Public gambling Act. The Director General of Police State of Tamil Nadu v. Mahalakshmi Cultural21 , the High Court t considered the question whether the Card Rummy is gambling or not and held that rummy played with stake is exempted from gambling act.. In this case also the High Court allowed members of association to play rummy with stake. The decisions of Supreme Court and High Courts specifically exempts rummy from gambling activity but there is still doubt that the online platforms providing online rummy along with other online games like three cards, poker, ludo games etc. can enjoy the protection from gambling in the name of rummy.
The recent Supreme Court directions to Andhra Pradesh High Court to consider the questions what constitutes skill of game and game of chance Conclusion: The online gambling activities are dangerous to the development of nation at large. The India Government tried its best from initial days to provide the legal framework to prevent gambling
18 https://incometaxindia.gov.in/pages/acts/income-tax-act.aspx Accessed on 19 September 2023
19 https://indiankanoon.org/doc/84963/ 19 September 2023
20 https://indiankanoon.org/doc/1248365/ 19 September 2023
21 https://indiankanoon.org/doc/61898553/ 19 September 2023
in India. The laws applicable to offline gambling are sufficient to prevent gambling but as far as there online gambling is concerned the present legal system is not adequate to solve the issues. The provisions of The Public Gambing Act prove outdated to prevent online gambling. The other laws enacted by state governments lack uniformity and failed to provide suitable action for prevention of online gambling The judicial approach towards online gaming and gambling is also not clear. In some cases, the judiciary approved the games like rummy as skill-oriented law. The Supreme Court and High Courts in some state upheld the claim that rummy is not gambling. It created confusion on nature of gambling activities The online gambling games may be raising revenue for government but are destroying the future of nation.
The misleading advertisements on online rummy game attracting the peoples to get easy income resulting in to wastage of time, money and health of players. Therefore, there is need of reconsideration skill game view by judiciary. Suggestions: The online gaming and gambling are the kind of disease which cannot be easily cured. In the era of information and technology, it is spread over the whole of India. The following are some suggestions to curb the menace of online gambling.
1. There is need of devoted and comprehensive and specialized legislation to regulate
online games and to prohibit gambling in India.
2. There is need to establish National Authority to regulate online games and to separate
it from gambling in India.
3. There is need of effective implementation of laws relating to online gambling.
4. There need of 50% income tax apart from GST on earnings received from online
gambling by platform operators and winners
References:
1. https://articles.manupatra.com/article-details/ONLINE-GAMING-CASINOS-AND-
FANTASY-SPORTS-AN-OVERVIEW-OF-GAMBLING-LAWS
2. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8313460/
3. https://www.merriam-webster.com/dictionary/gambling
4. https://www.rummycircle.com/
5. https://www.a23.com/rummy/rummy-cash-games.html
6. https://www.10cric10.com/
7. https://www.mpl.live/
8. https://www.unibet.com/
9. https://indiankanoon.org/doc/84963/
10. https://economictimes.indiatimes.com/news/india/bengaluru-techie-who-lost-rs-70lakh-in-online-gambling-reunites-with-wife-aftertherapy/articleshow/101474957.cms?from=mdr
11. https://diamondrehabthailand.com/what-is-online-gambling-addiction/
12. https://www.indiacode.nic.in/bitstream/123456789/2269/1/AAA1867____03.pdf
13. https://www.indiacode.nic.in/bitstream/123456789/13116/1/it_act_2000_updated.pdf
14. https://incometaxindia.gov.in/pages/acts/income-tax-act.aspx
15. https://indiankanoon.org/doc/84963/
16. https://indiankanoon.org/doc/1248365/
17. https://indiankanoon.org/doc/61898553/