Wives Say Men Are Wasting Money, State Says Act Is To Protect People; So How Can We Interfere? Madras High Court On Prohibition Of Online Gambling

Senior Advocate Abhishek Manu Singhvi, representing Gamesrakft Technologies Private Limited, was replying to a query from the division bench of Acting Chief Justice T Raja and Justice Bharatha Chakravarthy which asked why the State should not bring in a law banning online gaming when there are people dying in the country.

“Everywhere people are crying. Wives say the men are wasting money, and getting addicted. The State says the Act is to protect its people. So how can we interfere?” Justice Raja asked.

To this, Singhvi responded that there is no data about the social evils of online rummy. Singhvi said that even though there are greater social and health evils like drinking and lottery, the State had not banned these as these bring in the most revenue for it. Singhvi also argued that the courts in the country have repeatedly held that rummy is a game of skill and not that of chance. He argued that just because a game may include chance, it would not make it a game of chance as what had to be looked into was the predominance.

“Nothing can be 100% skill. Even in a game of Bridge, there is a matter of chance on which card you get. Courts have held that when you have chance and skill, you have to look at predominance… This Act is mainly for betting and gambling that involve chance issues and not skill. If in the 70 years of Jurisprudence, your lordships have year after year held that rummy is a game of skill and skill means predominantly skill, then how can the impugned Act prohibit the same,” Singhvi said.

The online gaming companies have challenged the Act, which came into effect on April 21. Earlier, an attempt was made to challenge the ordinance, but the court allowed the parties to withdraw the same as the Act was yet to be notified then

In the present batch of litigation, the companies have sought to quash the Act as being unconstitutional and being violative of their fundamental rights. The companies have also sought for an interim stay on the operation of the Act and requested that no coercive steps be taken till the disposal of the petitions.

Senior Counsel Aryama Sundaram, appearing for All India Gaming Federation, submitted that under Entry 31 of List I, only the Central Government is competent to legislate on wireless communication. He submitted that the central government has already come up with rules under the Information Technology Act which answer all the worries and concerns associated with online gaming. He further submitted that the State is not competent to have parallel legislation on the same.

Senior Counsel Kapil Sibal, appearing for the State of Tamil Nadu, on the other hand, submitted that it was the Centre that transgressed into the State’s authority as only the State is empowered to pass laws on betting and gambling. He also argued that even as per precedence, the courts have held that though Rummy is a game of skill and if it involves gambling or brought in revenue, it can be regulated. Sibal also submitted that it is a matter of private interest versus public interest and that the court has to decide how to interpret a law that is for protecting the families.

“These online gaming platforms are there to make money and destroy the lives of families. Your Lordships will have to decide how to interpret an Act which provides for the protection of families in this State. Your Lordships will have to look at the intent behind the Stature and not the sophistry of words which says that there is a threat of prosecution and give me protection. If protection is needed, the people of Tamil Nadu are the ones who need protection,” Sibal said.

The court refused to grant any interim stay on the operation of the Act. It said that no decision can be made on the matter without issuing notice to the State. The court directed the State to respond to the petition and submit their counters by July 3.

Senior Counsel Satish Parasaran and Advocates Deepika Murali, Suhrith Parthasarathy, and Suhaan Mukherjee also appeared for the petitioners. Additional Advocate General Amit Anand Tiwari also appeared for the State.

Case Title: All India Gaming Federation v State and others

Case No: WP 13203 of 2023