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MEITY says it has no judicial competence to regulate betting and gambling

In an affidavit, the IT Ministry says it doesn’t have legal oversight over online betting and gambling websites. A few months after this was filed, the government said it was exploring a “uniform approach” to regulating these platforms.

The Ministry of Electronics and Information Technology told the Delhi High Court in an affidavit that it doesn’t have the judicial competence to regulate betting and gambling apps online. “‘Betting and Gambling and its Taxation’ are covered under the State List to the Seventh Scheduld of the Constitution of India. States have enacted laws to regulate games/gambling activities,” MEITY Scientist (E) Dr. Dhawal Gupta said in the affidavit.

“Games in which preponderance of skill dominates cannot be considered ‘gambling’ and are protected under the Constitution of India. The legislative competence to determine [whether a game requires skill or luck] is conferred on the States only or to the Court of Laws,” Gupta said. “MEITY does not possess the judicial wisdom to determine whether an online game is involved in gambling or not.”

The case is Avinash Mehrotra v. Union of India, filed in 2020. The affidavit is dated January 20, 2021, but was only filed in August, according to Live Law.

This affidavit may be a snapshot of the current situation with regard to online gambling and betting — in which the central government has little power to regulate such activities — but it is far from the final position. The government is considering a “uniform approach” to regulating such services, IT Minister Ashwini Vaishnaw told the chief minister of Andhra Pradesh in a letter obtained by MediaNama last month.

What the MEITY affidavit says

  • Didn’t make states party: MEITY said that the petition should be dismissed as even though states were in charge of prohibiting gambling and betting, the petitioner didn’t make them parties to the case. “It is pertinent to state that the Petitioner, despite being fully aware that only the State Laws govern the aspect of games or gambling but has not provided any cogent reason for not including all State Governments as parties to the case,” the affidavit read.
  • IT Act sections not related to gambling: The petitioner was mistaken in stating that the Information Technology Act allowed the government to ban gambling websites, MEITY said. “Section 67 relates to [obscenity] and is not related to online games or gambling-related issues,” MEITY said. “Section 69 pertains to the Power to issue directions for interception or monitoring or decryption of any information through any computer resource [for security reasons, and] can be invoked only in national security related issues and not otherwise,” MeitY said.

Who is regulating gambling

“It is submitted that the following States/Union Territories have passed their own State Laws adopting the [pre-independence] Public Gambling Act, 1867, which ceased to be the Central legislation: (i) Andaman [and] Nicobar [Islands], (ii) Arunachal Pradesh, (iii) Chandigarh, (iv) Dadra and Nagar Haveli, (v) Haryana, (vi) Himachal Pradesh, (vii) Lakshadweep, (viii) Punjab, (ix) Madhya Pradesh, (x) Chhattisgarh, (xi) Manipur, (xii) Mizoram, (xiii) Tripura, (xiv) Uttarakhand, (xv) Andhra Pradesh, (xvi) Delhi, (xvii) Gujarat and Maharashtra, (xviii) Jammu & Kashmir, (xix) Meghalaya, (xx) Goa. However, most of these State laws do not cover online games,” MEITY said.

Some states did bring in changes to regulate online games, MEITY said, such as:

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  • Sikkim, whose Sikkim Online Gaming (Regulation) Act, 2008 is “the first Indian legislation to expressly permit and regulate online gaming.” However, “the State Government restricted the offering of ‘online games and sports games’ to the physical premises of ‘gaming parlours’ through intranet gaming terminals within the geographical boundaries of the State by enacting the Sikkim Online Gaming (Regulation) Amendment Act, 2015,” MEITY said.
  • Nagaland enacted the Nagaland Prohibition of Gambling and Promotion and Regulation of Online Games of Skill Act, 2015. This law “seeks to have pan-India application by extending the applicability of the said Act to all those States where the games so being offered are legally permissible ‘games of skill,’” MEITY said.
  • Andhra Pradesh amended its gaming act to prohibit online betting and “online games for money or other stakes”.
  • Tamil Nadu also amended its gaming and police laws to prohibit real money gaming. This ban was overturned by the Madras High Court.

“The issues relating to [the Foreign Exchange Management Act] or money laundering or tax evasions do not fall under the domain of [MEITY],” the ministry said.

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I cover the digital content ecosystem and telecom for MediaNama.

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.

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