Friends, has anybody asked you, “Let me do your work, you go and make your team on Dream 11.”
On the one hand, big celebrities are doing the Ad of Dream 11, on the other hand the news is published in the newspaper “Police arrested four people betting on cricket.”
Brother, what is this all going on?
Is it that, this is part of the Digital India campaign of the Government of India.
If you bet offline then its illegal,
And if you do so online it will be legal.
It’s amazingly good.
Dream 11 has received the clean chit from the High Court. You know that Dream 11 was also the official sponsor partner of IPL 2020 this year.
I also had to do a lot of research to solve this puzzle.
Are you also interested in knowing which game is legal and which is illegal?
After all, what should be considered a game and what should be gambling?
Are there any different laws for online and offline?
Are there similar laws across India related to it?
A few days ago Google removed the PayTm App from the Play Store. The reason was violation of Gambling rules.
Looking at the increasing popularity of Online Gaming Platforms like Dream 11 and Paytm First, it seems as if it is being used as a Proxy of Online Gambling. These online Gaming platform invites financial transactions, but due to no clear and specific law or regulation, it has been kept in the category of ‘Games of Skills’.
Gambling and Betting have been kept as State subjects in Schedule VII of the Indian Constitution. The law to govern it is the Public Gambling Act 1867. Each state has enacted its own law. Lottery has been regulated in some states, some have ban, while some have only allowed online lottery. Similar is the case of casinos.
But everyone has excluded ‘Games of Skills’ from the definition of gambling. While this is a 150 years old law, nothing is clear about which one are skill based games and which ones are chance based.
Nagaland Prohibition of Gambling and Promotion and Regulation of Online Games of Skill Act, 2016
Nagaland has taken the initiative to specify these games. The Act mentions which games will be considered as ‘Games of Skills’. There is no such clarity in other states. All conflict is left to the judiciary. In each case, the courts will have to decide individually whether the game is of skill or chance.
Now, if we talk about playing the game, then it can be a game of skill or a game of chance. But brother, what if someone else will play the game, and I want to bet on it, is it illegal?
No, it is not so in every case.
The Honorable Supreme court has considered putting Bet on Horse Racing also a game of skill. In a similar way Rummy is also in the category of Game of Skill.
The legality of Dream 11 was challenged in many cases in state high courts. In 2017, the Punjab & Haryana High court considered it a ‘Game of Skill’ and excluded from the definition of gambling. The Bombay High Court in 2019 and the Rajasthan High Court in 2020 have given a similar decision. The Honorable High Court has said that the format of Dream 11 requires knowledge, attention and judgment, so it should also be considered as Game of Skill.
Although the decision of Bombay High Court has also been challenged in Supreme Court, the decision of Supreme Court is awaited. Now it is to be seen that what opinion Apex Court makes on Dream 11 and all other the online games of fantasy. If the Supreme Court considers them as ‘Game of skill’ then they will remain legal and can be played anywhere in India.
If the Supreme Court says that it is ‘Game of Chance’ and considers it gambling, then the scene will change altogether.
If it is gambling, then it will be the power of States to make regulation on it, if they want to license it they will be able to do so according to their own decision.
Popularity
According to a report, 57 crore people are using internet in India, out of which 37 crore are streaming online games. About 400 startups are active in the online gaming industry and many companies also have foreign funding.
On the basis of revenue, the industry is now worth about Rs. 6500 crores and is grooving at 24% annually.
If an unaccounted revenue a large part of which is being played in illegal form or free gaming, casual gaming, is also added to it then it is worth of o $150 billion industry.
The game operator has to pay GST and the winners have to pay income tax. It is not that online gaming is white money and the Govt. get tax, so let it run.
In August 2020, Hyderabad Police arrested some Chinese nationals who were illegally running online betting sites. Under China based company, about 15-20 companies have been registered in India under different names. They created many websites and registered members. They collected money in different accounts and then they would rotate it into 2-3 company accounts and then transfer it overseas. ED has tracked the transactions of Rs.1100 crores which is only for this year. Out of these, only Rs.30 crores are attached which were in Indian bank accounts.
If online fantasy games are considered gambling and States are allowed to make regulation on it, then there can be two benefits.
1. Unauthorized websites can be stopped. This will prevent fraud with public.
2. License fees can be collected from game operators and income tax can also be taken in higher slab on the amount of reward.
Self-Regulation as a Option
In many industries, instead of Government making regulations, the responsibility is given to the Self Regulating Authorities to frame operating rules and ethics for themselves and monitor the registered members.
As we recently saw in the TRP case, Broadcasters and Advertisers have collectively formed BARC (Broadcast Audience Research Council), which calculates TRP and decides the rates of advertisement on the basis of the same. There is the NBA (News Broadcasters Association) which regulates news channels.
Similar is the FIFS [Federation of Indian Fantasy Sports] which regulates online gaming sites in India.
Limitations
Friends, the Govt. or the court has some limitations
Making a law or amending it is a long process, then some political and public pressure also remains. We have seen what happened at the time of CAA and what is happening on Farmer Bill right now.
Courts follows the written laws, their interpretation in things that are not specifically defined.
So the public also has a big responsibility to avoid things which are not morally correct and also keep others aware.
The Govt. also gets strength from public pressure to make regulation.
