Online Gaming: NGO Moves Delhi High Court Challenging Validity Of Information Technology Rules 2023

A Noida-based NGO has moved the Delhi High Court challenging the constitutional and legislative validity of the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Amendment Rules, 2023 that seek to regulate online gaming.

A division bench of Chief Justice Satish Chandra Sharma and Justice Sanjeev Narula today listed the matter for hearing on July 13 and sought assistance of Additional Solicitor General Chetan Sharma in the matter.

The plea has been moved by Social Organization for Creating Humanity through Advocate Sakshi Tikmany. The NGO is represented by Advocate Akshat Gupta.

It is the case of the NGO that the Impugned Rules are “beyond the legislative competence” of the Union Government inasmuch as Entry 34 of List II of the Seventh Schedule of the Constitution of India gives exclusive powers to State Governments to legislate on the issue of “gambling and betting.”

The plea submits that the Union Government’s enactment of Rules has led to “regulatory confusion and dual set of laws relating to online gaming”, adding that presently there is no clarity on whether Central or State laws should be followed with respect to online gaming.

“The Impugned Rules traverse beyond the rule-making powers granted to it by the parent legislation, i.e., the IT Act and wrongly classifies online gaming platforms as ‘intermediaries’, going beyond the definition and scope of the parent legislation. Section 79(2)(c)r/w Section 89(2)(z) of the IT Act allows the central government to prescribe guidelines for due diligence requirements of intermediaries which do not initiate the transmission, select the receiver of the transmission or select or modify the information contained in the transmission,” the plea reads.

Stating that the Information Technology Act nowhere defines the term ‘online gaming’, the plea adds that neither have online gaming platforms being classified as intermediaries nor has regulation of online gaming contemplated in any manner in the statute.

“Online gaming websites which the impugned rules seek to regulate as ‘intermediaries’, actively decide the content, i.e., games which are to be hosted or made accessible through their platforms. The online gaming platforms are actively engaged in deciding the content, stakes, kind of games and the kind of users that will compete against one another. Therefore, online gaming companies are publishers of content and cannot be treated as intermediaries under the IT Act,” the plea states.

Title: Social Organization for Creating Humanity (SOCH) v. Union of India