The Gambling Law Review: India


iBritish India and gaming 1

Prior to the promulgation of the Constitution of India, gambling in India was governed by the Public Gambling Act 1857. The Public Gambling Act 1857 was likely derived from the Gaming Act 1845 and the Betting Act 1853, enacted by the Parliament of the United Kingdom. The British Acts of 1845 and 1853 sought to make wagering contracts unenforceable but repealed the Unlawful Games Act 1541, where games of skill such as bowling and tennis were deemed unlawful. This approach seems to be reflected in the Indian Public Gambling Act 1857, which prohibited public gambling and the keeping of common gaming houses, but made an exception for games of skill.

iiIndependent India and gaming

After the promulgation of the Constitution of India and its coming into effect on 26 January 1950, the issues pertaining to gaming were divided. Betting and gambling were listed under Entry 34 of the State List (i.e., List II of the Seventh Schedule). This means that only the state legislature has the power to make laws pertaining to betting and gambling. Lotteries are mentioned in Entry 40, List 1 of the Union List, meaning that the Parliament of India is the appropriate body to make laws pertaining to lotteries. In addition, the state legislature has the power under Entry 62 of the State List to make laws pertaining to taxation of betting and gambling.

After the Constitution of India came into effect, most states adopted the principles of the Public Gambling Act 1857 with certain amendments, and each state has its own act on gambling.

iiiThe Indian gaming market

A perception exists worldwide that gaming in India is illegal or unregulated. However, this is not true. The gaming industry in India is estimated to be worth more than US$90 billion2 – this includes regulated and unregulated gaming. The gaming industry of India can broadly be classified into the following:

  1. lotteries;
  2. horse racing;
  3. prize competitions;
  4. sports betting;
  5. games of skill; and
  6. games of chance.


The Lotteries (Regulation) Act 1998 regulates lotteries within India. On 1 April 2010, the Government of India issued the Lotteries (Regulation) Rules 2010, further regulating, among other things, the number of draws and the minimum prize payout.

Lottery has been defined in the Lotteries (Regulation) Act 1998 under Section 2(b), as follows:

'Lottery' means a scheme, in whatever form and by whatever name called for distribution of prizes by lot or chance to those persons participating in the chances of a prize by purchasing tickets.

Horse racing

Most states have adopted the Public Gambling Act 1867 with an amendment pertaining to horse racing, whereby it has been specifically excluded. Under the amended gambling acts of the states, the following definition of gambling is given:

'Gaming' includes wagering or betting on any figures or numbers or dates to be subsequently ascertained or disclosed, or on the occurrence or non-occurrence of any natural event, or in any other manner whatsoever except wagering or betting upon a horse-race when such wagering or betting upon a horse-race takes place:
(a) on the day on which such race is to be run; and
(b) in any enclosure where such race is to be run, and sanction of the Provincial Government set apart from the purpose, but does not include a lottery.

In the case of Dr KR Lakshmanan v. State of Tamil Nadu,3 the Supreme Court of India recognised that horse racing, football, chess, rummy, golf and baseball are games of skill. It further held that betting on horse racing was a game of skill as it involved judging the form of the horse and jockey, and the nature of the race, among other variables.

The states and union territories that allow horse-race betting are Telangana, Assam, Delhi, Haryana, Karnataka, Maharashtra, Meghalaya, Punjab, Tamil Nadu, Uttar Pradesh and West Bengal. However, active horse racing currently takes place at the turf clubs in Bangalore, Chennai, Delhi, Hyderabad, Kolkata, Mumbai, Mysore, Pune and Ooty.

Prize competitions

Prize competitions in India are regulated under the Prize Competitions Act 1955. 'Prize competition' has been defined under Section 2(d) of the said Act:

'Prize competition' means any competition (whether called a cross-word prize competition, a missing-word prize competition, a picture prize competition or by any other name) in which prizes are offered for the solution of any puzzle based upon the building up, arrangement, combination or permutation, of letters, words, or figures.

The Prize Competition Act's applicability extends to the following states: Andhra, Bombay, Madras, Orissa, Uttar Pradesh, Hyderabad, Madhya Bharat, Patiala and East Punjab States Union, and Saurashtra, all erstwhile Part C States, and Pondicherry, Dadar and Nagar Haveli, Goa, Daman and Diu.

Sports betting

The status of sports betting, whether it is a game of skill or a game of chance, has not been clarified by the Supreme Court of India or a high court of a state. Sikkim has taken the initiative of legalising online sports betting within the state, with the promulgation of the Sikkim Online Gaming (Regulation) Act 2008. Under this Act, a licence for placing bets on sports games such as football, cricket, lawn tennis, chess, golf and horse racing can be issued.

In Meghalaya, the sport of teer (a form of archery) has been excluded from within the ambit of the state's Gambling Act, and betting on it is licensed. In Nagaland, betting on virtual sports and team selection sports can be offered under a licence.

Games of skill

Games of skill are identified as a separate category because various states in India (excluding Assam,4 Odisha (Orissa)5, Andhra Pradesh6, Tamil Nadu7 and Telangana8) have gambling acts that exclude games of skill from the ambit of gambling. In the absence of a legislative definition of a game of skill, the Supreme Court in Dr KR Lakshmanan v. State of Tamil Nadu;9 State of Andhra Pradesh v. K Satyanarayana;10 and State of Bombay v. RMD Chamarbaugwala11 has laid down that a game of chance is where the element of chance predominates over the element of skill, whereas a game of skill is where the element of skill predominates over the element of chance. The card games of rummy and bridge, along with other sports like golf and chess, have been classified as games of skill. In R Shankar Creation Association v. State of Karnataka,12 the Karnataka High Court classified poker, darts, carom and chess, among others, as games of skill. The Punjab and Haryana High Court, the Bombay High Court and the Rajasthan High Court have classified daily fantasy sports, in the format offered by India's leading operator, Dream11, as a game of skill. However, the applicability of the Bombay High Court judgment has been stayed by the Supreme Court of India on 6 March 2020.

The government of Nagaland under the Nagaland Prohibition of Gambling and Regulation and Promotion of Online Games of Skill Act 2015 (the Nagaland Act) has defined games of skill as:

Games of skill shall include all such games where there is preponderance of skill over chance, including where the skill relates to strategizing the manner of placing wagers or placing bets or where the skill lies in team selection or selection of virtual stocks based on analyses or where the skill relates to the manner in which the moves are made, whether through deployment of physical or mental skill and acumen.

All games enumerated in Schedule A of the Nagaland Act will be classified as games of skill. Schedule A includes games such as chess, sudoku, quiz, bridge, poker, rummy, nap, virtual sports, virtual games such as monopoly or racing, and virtual fantasy games.

Games of chance

Games of chance for stakes fall within the ambit of the gambling acts of the states and are largely prohibited. Some states, such as Goa, have created exceptions within their gambling acts, allowing for authorised gaming. Thus, licences are issued in the State of Goa for games of chance in casinos, which are operated on land as well as offshore. The State of Sikkim has also promulgated the Sikkim Casino Games Act 2004, which allows for casino operations within the state.

ivState control and private enterprise


Under the Lotteries (Regulation) Act 1998, it is the state governments that have the power to organise, conduct and promote lotteries, subject to the conditions prescribed. The lotteries department of each state, generally established under their revenue departments, are in charge of running lotteries. States have appointed agents that are private companies, to operate and promote lotteries on their behalf within the state and to other states. Lotteries in India13 are permitted in the following states: Maharashtra, Mizoram, Bodoland Territorial Council,14 Goa, Sikkim, Nagaland, Kerala (only paper lottery), Punjab (only paper lottery), West Bengal and Meghalaya.

In addition to the above, the national lottery of Bhutan is also sold in India. This has been allowed through the Trade, Commerce and Transit Agreement between the Republic of India and the Royal Government of Bhutan.15

Horse racing

Horse racing in India is primarily controlled by the six turf clubs, namely:

  1. the Royal Calcutta Turf Club (RCTC);
  2. the Royal Western India Turf Club Ltd (RWITC);
  3. the Madras Race Club (MRC);
  4. the Bangalore Turf Club Ltd (BTC);
  5. the Delhi Race Club (DRC); and
  6. the Hyderabad Race Club (HRC).

These turf and race clubs lay down the rules of racing, as well as control their enforcement. The licences to conduct horse races were issued to them by their respective state governments. The totalisator and the bookmakers at these race clubs, including for off-course betting, were licensed under the respective state's act on entertainment and betting tax. Recently licences for online betting on horse races has been issued to the RCTC, RWITC, MRC, BTC and HRC.

Prize competitions

Prize competitions in India are offered under a licence issued by states under the Prize Competition Act 1955. A prize competition can be offered by a person who has procured the licence from the state, provided that the maximum prize that can be offered in such a competition does not exceed 1,000 rupees and there are not more than 2,000 entries.

Sports betting

The only state where sports betting can be offered is Sikkim. Licences have been issued to private operators to offer sports bets.

In Meghalaya, bets can be placed on teer (a traditional game of the state) under a licence. In the State of Nagaland, bets on virtual sports and team selection sports can be offered under a licence.

Games of skill

Games of skill are outside the ambit of states' gambling acts. Whereas games of skill for stakes, like horse racing and teer, require a licence from state governments, other games of skill like rummy and bridge can be offered without a licence in most states.

Nagaland has sought to regulate and license games of skill throughout India, through the Nagaland Act. The Nagaland Act contemplates the regulation and promotion of games of skill through the issuance of licences. A licence can be procured by a person, firm, company or limited liability company incorporated in India that is substantially held and controlled in India. A licensee is allowed to offer games of skill across India, in states where such games are not classified as games of chance and in states where an exception for games of skill exists in the state's gambling act.

Games of chance

Games of chance like casino games can be offered in Goa and Sikkim under a licence. Licences have been issued to private entities within these states.

vOffshore gambling

Foreign direct investment (FDI) in India is governed by the Foreign Exchange Management Act 1999 (FEMA) and the regulations made thereunder. FDI is subject to the Foreign Direct Investment Policy (the FDI Policy).

Under the FDI Policy, FDI remains prohibited in certain sectors, including lottery business, gambling and betting. Besides FDI, any form of foreign technology collaboration, such as licensing for franchise, trademark, brand name, management contract, etc., for lottery business, gambling and betting activities has also been prohibited under the prevailing FDI Policy.

Under FEMA, the Foreign Exchange Management (Current Account Transactions) Rules 2000 (the Current Account Rules) were framed to impose reasonable restrictions for current account transactions. The Current Account Rules provide that transactions included in Schedule I are prohibited. Remittance from lottery winnings, racing or riding, purchase of lottery tickets, football pools, sweepstakes, etc., are included within Schedule I, which essentially means that all foreign exchange gaming transactions are prohibited. Thus, an offshore gaming operator is unlikely to be able to offer his or her services from outside India within India.

Legal and regulatory framework

iLegislation and jurisprudence


The Supreme Court of India in BR Enterprises v. State of UP16 has held that a lottery is a game of chance and is not a business or trade; rather, it is in the nature of res extra commercium. The Supreme Court also held, while interpreting Section 5 of the Lotteries Act 1998,17 that a state could not exclude other states from its own lottery. Either the state had to declare itself as a lottery-free zone or permit lotteries from other states. In a subsequent judgment, in All Kerala Online Lottery Dealers Associations v. State of Kerala,18 the court distinguished from the principle of the earlier judgment (the BR Enterprises case) and held that paper lotteries and online lotteries fell in different classes. Therefore, a state would be permitted to ban online lotteries and allow paper lotteries or vice versa, without violating the provisions of Section 5 of the Lotteries Act 1998.

Horse racing

Horse racing and betting on horse racing is permitted in licensed premises. Licenses have been issued to Indian turf clubs. In 2021, the turf clubs in Mumbai, Pune, Bangalore, Hyderabad and Kolkata were provided with approvals to conduct and operate 'online betting or wagering' on horse races within their states.

Prize competitions

In News Television India Ltd v. Ashok Waghmare,19 the Bombay High court held that prize competitions do not include skill games, and even popular TV quiz shows like Kaun Banega Crorepati (a version of Who Wants to be a Millionaire?) are excluded from its ambit.

Sports betting

The Supreme Court had directed the Law Commission of India to consider whether betting on sports can be regulated in India.

The Law Commission of India published a report titled 'Gambling and Sports Betting including Cricket in India'.20 The Commission made recommendations regarding the power of the legislature at the Centre, to regulate sports betting and gambling along with recommendations on the structure of the said proposed regulations while observing the advantages of the same and noting that said regulations would serve to regularise an existing, thriving and rampant unofficial industry.

Games of skill

The issue of games of skill for stakes, and whether they fall within the ambit of a state's gambling act, has not been adjudicated upon by the Supreme Court. In absence of an express judgment of the Supreme Court, contrary opinions exist among the high courts and legislatures of the states.

The Punjab and Haryana High Court, in Varun Gumber v. Union Territory of Chandigarh and Ors,21 held the fantasy game format offered by one of the fantasy game operators to be a 'game of skill'.

The High Court of Judicature at Bombay (Division Bench), in Gurdeep Singh Sachar v. Union of India and Ors,22 observed and held that the Online Fantasy game of the fantasy game operator does not involves 'betting', 'wagering' and 'gambling' activities respectively and that online fantasy is a 'game of skill'. The decision of the Bombay High Court was appealed, and the Supreme Court of India – see its order dated 6 March 2020 – stayed the applicability of the Bombay High Court judgment and issued notice to all the parties.

The Jaipur Bench of the High Court of Rajasthan in Ravindra Singh Chaudhary v. Union of India23 held that fantasy sports games offered online is not a part of wagering contract, since they depend on skill of participant and not merely on chance and thus, the business offered by the platforms operating online fantasy sports has protection under Article 19(1)(g) of the Constitution of India. It also observed that the fantasy sports offered online are not operating in total regulatory vacuum and are subject to self-regulation by the industry body known as the Federation of Indian Fantasy Sports (FIFS), and rules and regulations of the charter of FIFS ensure that the games run by its members are 'games of skill' and are not in the form of any gambling or betting.

Tamil Nadu has promulgated the Tamil Nadu Gaming (Amendment) Act, 2021, which bans gaming by means of, inter alia, cards and dice (such as rummy and poker) in the form of betting or wagering in cyberspace using communication devices such as computers or mobile phones or any other device and also prohibits 'electronic transfer of funds' for placing bets, distributing the winnings of games and any other prize money related to online games (including rummy and poker) in the State of Tamil Nadu.

The Telangana Gaming Act 1974 amended vide the Telangana Gaming (Amendment) Act 2017 dated 7 November 2017 prohibits the residents of Telangana to organise, provide, participate in and play games of skill (including online games of skill) in and from the state for stakes.

The Andhra Pradesh Gaming Act, 1974 amended by the Andhra Pradesh Gaming (Amendment) Ordinance, 2020 prohibits playing, opening, keeping, operating, using or permitting online gaming (including games of skill) for money or stakes in its territory. The Gujarat High Court, in its decision dated 4 December 2017 in the case of Dominance Games Pvt Ltd v. State of Gujarat and Ors,24 held that poker is a game of chance, and hence prohibited in the State of Gujarat. However, an appeal captioned as Dominance Games Pvt Ltd v. State of Gujarat and Ors25 is pending before the division bench of the same High Court.

The Division Bench of the Kerala High Court in Ramachandran K v. Circle Inspector of Police Mallapuram District26 held that playing rummy for stakes is not excluded under the Kerala Gaming Act 1960 and that the same amounts to a 'gambling activity'. After the judgment of the Hon'ble High Court of Kerala dated 10 February 2021 in the Pauly Vadakkan case, the Home (F) Department of the Government of Kerala – see its notification GO(P) No. 26/2021/HOME dated 23 February 2021 in the Kerala Gazette Extraordinary – has banned 'online rummy played with stakes'.

In the case of Indian Poker Association & Anr v. State of West Bengal & Ors27, the Calcutta High Court (Circuit Bench at Jalpaiguri) vide its order dated 29 August 2019 observed and held that since the game of poker is not included within the gambling activities under the West Bengal Gambling and Prize Competitions Act 1957, the police cannot interfere with such games.

iiThe regulator

Lotteries are regulated by the Directorate of Lotteries under the Finance Department of each state. Horse racing and betting on horse racing is regulated by the relevant turf authority or club.

For prize competitions, states have formulated rules where the manner of procuring the licence has been laid down. Applications are to be made to the authorities designated by the states.

The licensing and regulator under the Sikkim Online Gaming Act 2008 is the officer designated by the Lotteries Department (government of Sikkim).

The regulator for casinos in Sikkim is the authorised officer, appointed by the Department of Tourism (government of Sikkim). However, in Goa, a gaming commissioner is to be appointed under Section 13C of the Goa Public Gambling (Amendment) Act 2012.

The regulator for the online games of skill under the Nagaland Act is the Finance Commissioner or any other authority designated and empowered on his or her behalf.

iiiRemote and land-based gambling

Lotteries are offered in a paper format as well as online, across states where lotteries are permitted. Paper lotteries are generally offered through lottery shops and stalls. Online lottery in India means digital lottery and does not mean that lottery entries can be sold over the internet.

Horse racing and betting on horse racing was earlier permitted only at licensed premises and off-course betting shops. With the issuance of licences to take online bets, online betting on horse racing can now be offered in Maharashtra, Karnataka (in abeyance), Tamil Nadu, Telangana and West Bengal.

The Prize Competition Act 1955 does not make a distinction between paper-based and online prize competitions. These competitions are generally conducted through dailies and posts.

Online sports betting offered through parlours on an intranet network is permitted in Sikkim.

The principal law that governs gaming is the Public Gambling Act 1867. This Act does not make a distinction between premises-based and online gaming. The states that have permitted casinos allow the offering of casino games only at the premises, whether they are on land or on ships or cruises.

Online games of skill can be offered across India under the Nagaland Act.

ivFinancial payment mechanisms

The payment mechanisms available depend on how a game is classified, Games of skill, usually have the entire gamut of payment mechanisms available to them, from banks to mobile wallets.

In casinos in Goa and Sikkim, again the entire gamut of payment mechanisms is available, subject to proper KYC verifications. However, for lotteries, banking and the online payment systems are not available. Tickets, whether paper or digital, are bought through payment of cash and a vendor's shop.

While cryptocurrencies are not banned in India, the Reserve Bank of India does not recognise them as legal tender. Therefore, cryptocurrency cannot be used as a form of currency for settling legal wagers.

The licensing process

Application and renewal


Lotteries are operated and promoted by state governments. States invite private enterprises to partner with them to promote and market the state's lottery through a tendering process. The request for proposal document is generally released on a payment basis by each state for such tendering. Some of the tender conditions are:

  1. operations must continue in India for five years;
  2. the applicant must have been a profitable vendor for three years;
  3. the applicant must a minimum experience of one year in the past three years;
  4. the applicant must have a state government certificate supporting the experience of the vendor;
  5. there must be a deposit of earnest money; and
  6. there must be an advance payment of sale proceeds.

Horse racing

No new licences for horse racing have been issued in the past two decades. Even the licences for online betting on horse racing were allotted to the turf clubs. However, a number of private operators have tied with the turf clubs for providing technological or operational assistance to them, or both, for operating online horse betting.

Sports betting

Licences for sports betting are issued in Sikkim. An application for a licence needs to be made to the Government of Sikkim. The designated authority, is the Secretary to the government of Sikkim (Finance, Revenue and Expenditure Department). The application needs to be made using Form 1 accompanied by a bank draft of 500 rupees in favour of the director, Sikkim State Lotteries. After examining the application and making due enquiries (no time period is provided), the government can grant a provisional licence on the payment of a fee of 100,000 rupees in Form 2. The provisional licence is granted to enable the licensee to set up the infrastructure and comply with other licensing requirements. Subject to compliance with the licensing terms, a regular licence in Form 2A is issued for a period of five years on the payment of a fee of 50 million rupees.

Licences for teer bookmakers can be issued under Section 14(3)A of the Meghalaya Amusement and Betting Tax Act. Further, under Section 14A(1)m of the Meghalaya Amusement and Betting Tax Act, terms and conditions for a licence are to be prescribed. Details pertaining to the licensing conditions and the process to be followed for licensing are not readily available.

Prize competitions

Under the prize competition rules of states,28 the application for running a prize competition needs to be made in Form A and should be submitted personally or sent by registered post to the licensing authority. The licence is effective throughout the state. The fee for granting a licence is 25 rupees where an entry fee is charged, and 10 rupees where no such fee is charged. The fee for renewal is half of the initial fee.

Games of skill

No licence is required to operate a game of skill outside the State of Nagaland. Licences have been issued under Section 7 of the Nagaland Act. Licences for a period of five years can be issued to individuals, firms or companies provided:

  1. they are not engaged in gambling;
  2. they do not have a criminal history;
  3. the controlling stake and exercise of executive decisions is within India; and
  4. the technology and support platforms are within India.

Under the Nagaland Act, rules have been formulated to govern the licensing process. Under Rule 4(3) an application needs to be made accompanied by documents supporting the credentials of the promoters, audited financials, note on software technology platform, business plan and financial projections. A non-refundable application fee of 50,000 rupees through a demand draft also needs to be deposited. The details are then forwarded to the empanelled firm, which then makes an enquiry and issues a certification or recommendations for compliance. If a certification is issued by the empanelled firm, the licensing authority is bound to issue a licence within 14 days. In the event that recommendations are received from the empanelled firm, the recommendations shall be referred to an ad hoc committee or expert committee formed under the Nagaland Act for its recommendations, which are not binding on the licensing authority.

Under the Nagaland Act, licences can be issued for a game or bouquet of games (three or more games). An annual licence fee of 1 million rupees per game per annum or 2.5 million rupees for a bouquet of games per annum for the first three years is payable. For the subsequent two years, 2 million rupees per game per annum or 5 million rupees for a bouquet of games per annum is payable. In addition, the licensee is required to pay an amount of 0.5 per cent of the gross revenue generated as royalty to the state government.

Games of chance

Under Section 13A of the Goa, Daman and Diu Public Gambling Act 1976, the government may authorise any electronic amusement games or slot machines in five-star hotels (and such table games and gaming on offshore vessels as may be notified) subject to certain conditions, including payment of recurring and non-recurring fees. The validity of licences granted by the government of Goa is generally five years. The annual licence fees for onshore Goan casinos are as follows:

  1. up to 100m² – 100 million rupees (hiked by 60 million rupees);29
  2. 100m² to 330m² – 200 million rupees (hiked by 150 million rupees);30
  3. 330m² to 550m² – 250 million rupees (hiked by 195 million rupees);31
  4. 500m² to 825m² – 320 million rupees;32
  5. 825m² to 1,100m² – 360 million rupees;33 and
  6. over 1,100m² – 400 million rupees.

For offshore casinos (passenger capacity-based), the fees are:

  1. up to 220 passengers – 250 million rupees (hiked by 170 million rupees);
  2. 220 to 440 passengers – 300 million rupees (hiked by 200 million rupees); and
  3. over 440 passengers – 400 million rupees (hiked by 288 million rupees).34

The annual recurring fees for the financial year 2020–2021 shall be calculated on monthly pro rata basis, and the payment thereof in respect of the month of November 2020 up to March 2021 shall be made on or before the fifth day of the respective month. The schedule of payment of the unpaid annual recurring fees in respect of the month of April, 2020 up to October 2020 shall be as specified by the Goa government by an order published in the official gazette.

Under the Sikkim Casino Games (Control and Tax) Rules 2007, an application for a licence needs to be made through Form A. Provisional licences under these Rules are granted for a period of five years and can be renewed. A licence fee of 50 million rupees is payable for a casino licence.


iLotteries (Regulation) Act 1998.

Under the Lotteries (Regulation) Act 1998, the organisation, conduction or promotion of an illegal lottery is punishable with a rigorous imprisonment of up to two years or fine or both.

iiNagaland Prohibition of Gambling and Promotion and Regulation of Online Games of Skill Act, 2015

Under the Nagaland Prohibition of Gambling and Promotion and Regulation of Online Games of Skill Act, 2015, if any licence holder is found to be engaging in game of chance or gambling activities, the entity shall be liable to a fine of 2 million rupees in the first instance and, if not remedied thereafter, to a simple imprisonment of six months.

iiiThe Goa, Daman and Diu Public Gambling Act of 1976

Under the Goa, Daman and Diu Public Gambling Act of 1976, the punishment for maintaining a gaming house is punishable with an imprisonment for a term of up to three years and also a fine of up to 5,000 rupees. The punishment for gaming in a gaming house is punishable with an imprisonment for a term of up to three years and also a fine of up to 5,000 rupees.

ivSikkim Online Gaming (Regulation) Rules, 2009

The punishment for non-compliance with procedure for advertisement of online games rules and the certification of OGS will be punishable with a fine of up to 5,000 rupees.

If any licensee or operator admits or allows a minor to play online games shall be punished with a fine up to 1,000 rupees.

If any licensee is found contravening the conditions of the licence, he or she is liable to be punished with a fine of up to 10,000 rupees.

Any individual other than the licence holder, found violating the conditions of a licence while playing online games, may be punished with a fine of up to 5,000 rupees.



Lotteries authorised by a state government attract a tax of 28 per cent on the face value of the ticket.35 In addition, as per Section 115BB of the Income Tax Act, winnings on lotteries in the hands of an individual are taxed at 30 per cent.

iiHorse racing

The GST council placed gambling and totalisator services provided by a racecourse as well as betting with licensed bookmakers in racecourses in the 28 per cent tax band. Further, the GST Council on 18 January 2018 provided clarification pertaining to GST on horse racing,36 which stated that GST would now be leviable on the entire bet value (i.e., total of face value of any or all bets paid into the totalisator or placed with licensed book makers, as the case may be).

In addition, all winnings of a player or individual are taxed under Section 194BB of the Income Tax Act at 30 per cent.

iiiPrize competitions

Under Section 194B of the Income Tax Act, all winnings from prize competitions, such as crossword puzzles, are taxed at 30 per cent.

ivGames of skill and games of chance

Under entry 34 of the Central Goods and Service Tax notification dated 28 June 2017, all services rendered pertaining to an entry into a casino would be chargeable with a GST of 28 per cent on the gross amount collected as admission charge or entry fee. In a subsequent circular dated 4 January 2018, it was clarified that the tax of 28 per cent would apply on entry to casinos as well as on betting and gambling services being provided by casinos on the transaction value of betting (i.e., the total bet value), in addition to GST levy on any other services being Circular No. 27/01/2018-GST provided by the casinos (such as services by way of supply of food and drinks, etc., at the casinos).

The aspect of GST on games of skill is still unclear. The Bombay High Court in its decision dated 30 April 2019 in the case of Gurdeep Singh Sachar v. Union of India and Ors,37 held that the acknowledgement amount (total amount staked) would qualify as an actionable claim, which is neither considered as supply of goods nor services under GST (Schedule III of the GST). This means Dream11 is correct in discharging GST at 18 per cent on the platform fee only.

Under Section 194B of the Income Tax Act, all winnings from card games and other games of any sort, betting and gambling are taxed at 30 per cent.

Advertising and marketing

The regulatory framework with regard to TV shows and advertisements, and possible electronic dissemination of material projecting gaming, is envisaged in the Code for Self-Regulation in Advertising (the Code), the Cable Television Network Rules 1994 and the Consumer Protection Act 2019.

The Advertising Standards Council of India (ASCI) issues the Code for specifically dealing with various issues regulating advertisement content. The Code permits advertisements pertaining to prize competitions and lotteries, wherein it requires that all material conditions should be stated for the consumer to obtain a true and fair view of their prospects in such activities.38 Recently, ASCI, in a press release dated 4 November 2020, issued Guidelines for advertisements and advertising content concerning online gaming for real money as ASCI Guidelines for 'Online Gaming for Real Money Winnings'. These guidelines include the following:

  1. no gaming advertisement may depict any person under the age of 18 years;
  2. the gaming advertisement must carry disclaimer that the game involves an element of financial risk and may be addictive;
  3. the advertisement should not suggest 'Online gaming for real money winnings' as an income opportunity or an alternative employment option; and
  4. the advertisement should not suggest that people engaged in gaming activity is in any way more successful as compared to others.

The guidelines for online gaming for real money winnings were affirmed by the Ministry of Information and Broadcasting – in its Circular39 that advised all the broadcasters to follow and adhere to the ASCI Guidelines – and the Ministry has directed broadcasters to ensure that no advertisement promotes any activity that is prohibited by any statue of law.

Under the Cable Television Network Rules 1994, advertisement of gambling is prohibited, but the advertisement of games of skills, such as horse racing, rummy and bridge, is not prohibited.

Under the Consumer Protection Act 2019, unfair trade practices are prohibited. This would include the conduct of any contest, lottery, game of chance or skill, for the purpose of promoting, directly or indirectly, the sale, use or supply of any product or any business interest.

The year in review

The Delhi High Court vide its decision dated 28 November 2019 in Avinash Mehrotra v. Union of India and Ors40 dismissed the Public Interest Litigation of the petitioner and directed the respondents (Union of India, state government, central government authorities) to decide on whether the betting and gambling websites should be banned or not, decide the legality of the games (poker, rummy, teen patti, bridge, etc.) mentioned in the writ petition and pass a reasoned order for gaming found to be gambling in accordance with law, rules, regulations and government policy. The respondents were also directed to respond to the claims whether the games referred to in the writ petition violated the money-laundering laws, foreign exchange laws and tax laws in India. In response to the said order of the Delhi High Court regarding banning of gaming or gambling websites, the Ministry of Electronics and Information Technology – in its official letter41 – clarified that it does not have any legislative mandate to take any action against any gambling or betting-related issues and that this falls under the exclusive domain and legislative competence of the respective state legislatures in accordance with the Constitution of India.

The states of Andhra Pradesh and Tamil Nadu have enacted legislation to amend their respective gaming and gambling Acts and consequently ban online games of skill (with stakes) such as rummy and poker in their territories, respectively. The government of Kerala has enacted legislation banning online rummy.

Online betting on horse racing has started in Maharashtra, Tamil Nadu, Telangana, Karnataka and West Bengal. This has presented a new opportunity and shall spur on the online gambling industry in India.

In December 2020, NITI Aayog, the premier think tank of the government of India, released a draft paper titled 'Guiding Principles for The Uniform National-Level Regulation of Online Fantasy Sports Platform in India' to discuss the proposed guidelines (stated in the draft paper) with all stakeholders and invited their comments on the same. NITI Aayog also recognised that online fantasy sport platforms are regulated by the respective state legislatures and are governed by varied state-wide regulatory regimes.


The appeal pertaining to daily fantasy sports is being heard by the Supreme Court of India. If successful, it will galvanise the industry; however, if unsuccessful, it will be a massive setback to the games of skill industry in India. The finalised guidelines from NITI Aayog are awaited. There is hope in the industry that the guidelines could be broader based, rather than only addressing fantasy sports. The state of Meghalaya, as per available news, has decided to regulate sports betting and other games of skill within its territory. The draft law should be published soon.


1 Vidushpat Singhania is the managing partner of Krida Legal.

2 KPMG, 'A year off script: Time for resilience', A synopsis, KPMG in India's Media and Entertainment Report, 2020, September 2020, page 7.

3 Dr KR Lakshmanan v. State of Tamil Nadu (1996) 2 SCC 226.

4 The Assam Game and Betting Act 1970.

5 The Orissa Prevention of Gambling Act 1955.

6 The Andhra Pradesh Gaming (Amendment) Ordinance, 2020.

7 The Tamil Nadu Gaming and Police Laws (Amendment) Ordinance, 2020.

8 The Telangana Gaming (Amendment) Act, 2017.

9 See footnote 7.

10 State of Andhra Pradesh v. K Satyanarayana (1968) 2 SCR 387, AIR 1968 SC 825.

11 State of Bombay v. RMD Chamarbaugwala AIR 1957 SC 699.

12 R Shankar Creation Association v. State of Karnataka, WP No. 16622/2012, decision dated 4 June 2012.

13 As at 2 March 2020.

14 The Bodoland Territorial Council is not a state as per the Indian constitution. This is an area in the north-eastern region of India, which was created recently by carving out areas from eight districts of Assam, namely, Kokrajhar, Dhubri, Bongaigaon, Barpeta, Nalbari, Kamrup, Darang and Sonitpur within the State of Assam. It is an autonomous administrative unit constituted under the Sixth Schedule of the Constitution of India covering an area of 8,795km² (provisional).

15 Reference to Article 1 of the Agreement: 'For the purpose of this Agreement, the term “free trade and commerce” in Article I shall be understood to include within its scope the sale of Bhutan lottery tickets in India and the sale of Indian government and state lottery tickets in Bhutan, subject to the relevant laws which may be in force in the territories of the Kingdom of Bhutan and India, as the case may be.'

16 BR Enterprises v. State of UP (1999) 9 SCC 700.

17 Section 5, Lotteries Act 1998: 'A state government may, within the state, prohibit the sale of tickets of a lottery organised, conducted or promoted by every other state.'

18 Civil Appeal Nos. 3518–3520.

19 News Television India Ltd v. Ashok Waghmare (2006) 2 MhLj 431.

20 Law Commission Report No. 276, dated 5 July 2018.

21 CWP No. 7559 of 2017.

22 CRPILST/22/2019 (Stamp), decided on 30 April 2019.

23 D.B. Civil Writ Petition No. 20779/2019

24 See footnote 8.

25 Letters Patent Appeal (LPA) – No. 193 of 2018.

26 WP(C) No. 35535 of 2018, decided on 24 January 2019.

27 WPA No. 394 of 2019.

28 Bombay Prize Competitions Rules 1959 and the West Bengal Prize Competitions Rules 1958.

29 Official Gazette Extraordinary No. 3 Series I No. 31, Government of Goa, 4 November 2020.

30 Official Gazette Extraordinary No. 3 Series I No. 31, Government of Goa, 4 November 2020.

31 ibid.

32 ibid.

33 ibid.

34 ibid.

36 Government of India, Ministry of Finance, Department of Revenue, Tax Research Unit, Circular No. 27/01/2018-GST accessed on 3 March 2018, available at;jsessionid=42E3FB9C54911DECD0C5CEC38DA713F1.

37 CRPILST/22/2019 (Stamp), decided on 30 April 2019.

38 Example (f), Chapter 1 of the Code.

39 Circular No. 4407/13/2019-BC-I dated 4 December 2020.

40 WP(C) 5661/2019 and CM No. 24836, 34219, 35292/2019.

41 No. AA-4 (30)/2019 – CLeS dated 21.10.2020.

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