'State Can't Ban Game Of Skill' : Singhvi Argues Before Karnataka High Court Against Online Gaming Ban

The petitions were partly heard before diwali vacation by a single judge bench of Justice Krishna S Dixit. However, post diwali vacation as the roster changed all matters wherein the vires of an Act is under challenge, has to be placed for hearing before a division bench. Accordingly, the matter was taken up by a bench headed by Chief Justice Ritu Raj Awasthi.

The court began hearing the petition on the aspect of interim relief. Senior Advocate Dr Abhishek Manu Singhvi, opened the arguments pleading before the court for staying the operation of the Amendment Act, till the final disposal of petitions. It was submitted by him that, "There is a distinction between Game of chance and game of skill. Game of chance alone can be regulated to the point of banning by state authorities. Conversely to this, state governments have no jurisdiction to ban games of skill. This distinction has been in existence for years."

He added, "Game of skill is predominantly a game of skill not entirely or exclusively. When you say game of chance, it means predominantly, dominantly, game of chance, not that it has to be only chance. This has been established by 70 years of jurisprudence."

To support his proposition he cited, "For example, in any card game there is an element of chance, to the extent of handing over the chance. That chance does not mean that Bridge or Rummy is not a game of skill. Merely because there is a chance does not make it a less skillful game of skill."

Further, it was contended, "State has competence on game of chance and not game of skill. There is no difference if the games are played in virtual mode." He also submitted that, "Bringing a ban on game of skill held to be per se, game of skill protected by decades of common law, equally makes it arbitrary under Article 14."

Referring to the judgements passed by the Madras and Kerala High Court which have struck down similar amendments, it was submitted that, "In all states there have been pre-existing Acts, which have been for several years. All of them had exclusions for games of skill. Along came this populism/paternalism thought process, and these new forms of amendments were put in."

He added, "Today in this world there are many things we will dislike. The problem is unless the activity in the narrowest zone of vice is like noxious activity. If we start applying our individual standards we will be worse than a chancellor's foot situation."

Urging the court to make a clear distinction between games of skill and chance it was said, "Element of chance is in the game and also skill is in the game. Who pays whom, that is not chance or skill. Chance or skill arises from the intrinsic nature of the game and not from who wins or who loses." He also relied on Supreme Court and High Court judgements to support his contentions.

Advocate General Prabhuling K Navadgi on Thursday orally assured the court that no precipitative action would be taken against online gaming companies for the time being.

The matter will next be heard on November 18.

Background:

The Amendment Act came into force on October 5, it includes all forms of wagering or betting, including in the form of tokens valued in terms of money paid before or after the issue of it. It has banned electronic means and virtual currency, electronic transfer of funds in connection with any game of 'chance'. However, there is no ban on lottery, or betting on horse races on any racecourse within or outside Karnataka.

The statement of objects and reasons states: "It is considered necessary further to amend the Karnataka Police Act, 1961 Karnataka Act 4 of 1964, to provide for effective enforcement of the provisions of this Act by making offences under Chapter VII and under section 90, 98, 108, 113,114 and 123, as cognizable offence and non-bailable except section 87, which is made cognizable and bailable."

Further, "Include the use of cyberspace including computer resources or any communication device as defined in the Information Technology Act, 2000 in the process of gaming, to curb the menace of gaming through internet, mobile app, to enhance the punishment for gaming for the orderly conduct of citizens and to wean them away from the vice of gambling."

Case Title: All India Gaming Federation v. State Of Karnataka

Case No: WP 18703/2021