Indian Laws on Gaming

Indian Gaming Commission aims to work in coherence with the existing Central and State laws to regulate gaming in India. As millions engage in competitive gaming throughout the country, we believe in the need for rigorous regulation.

Laws on Gambling

The laws pertaining to gaming and gambling can be summarised as:
The Public Gambling Act of 1867 clearly states that anyone involved in operating a gambling house or abetting in operations of gambling house, visiting gambling places, financing gambling operations or possessing gambling devices can be charged a fine of not exceeding Rs. 200 or up to three months in jail. The government has affirmed its commitment to keep this 145 year old law on the books for referring it to other occasions.  However, there are many laws that permit and regulate activities related to gaming and gambling. ‘The Lotteries (Regulation) Act, 1998’ sets guidelines and restrictions in conducting lotteries. In addition, Section 294-A of the ‘Indian Penal Code, 1860’ lays down punishment for running unauthorised lottery office. Section 30 of the ‘Indian Contract Act, 1872’ prohibits any person from bringing a suit for recovery of any winnings won by way of a wager. Similarly, there are lots of state legislations like ‘The Delhi Public Gambling Act, 1955’, ‘The Bombay Prevention of Gambling Act, 1887’ and ‘The Bengal Public Gambling Act, 1867’that regulate gambling activities.

Laws on Games of Skill

The Public Gambling Act has explicitly stated, “nothing in this Act shall apply to games of mere skill wherever played”. Hence in the absence of any other laws, wagering on skill-based games is legal. More clarifications were added by the Supreme Court of India in 1996 while defining games of skill:

“The competitions where success depends on substantial degree of skill are not ‘gambling’ and despite there being an element of chance if a game is preponderantly a game of skill it would nevertheless be a game of ‘mere skill’”

Games Declared as ‘Games of Skill’

Rummy: The Supreme Court of India has ruled that rummy is a game of skill in the year 1968. In 1996, the Supreme Court of India had also stated that (i) competition where chances of success depends on significant degree of skill is not considered as ‘gambling’ and (ii) despite the fact that there is an element of chance, rummy is preponderantly a game of skill and, thus, may be considered as a game of ‘mere skill’.

In another court hearing, the Supreme Court in 1996 had reiterated rummy as a game of skill:

“A game of skill, on the other hand – although the element of chance necessarily cannot be entirely eliminated –is one in which success depends principally upon the superior knowledge, training, attention, experience and adroitness of the player. Golf, chess and even Rummy are considered to be games of skill. The Courts have reasoned that there are few games, if any, which consist purely of chance or skill, and as such a game of chance is one in which the element of chance predominates over the element of skill, and a game of skill is one in which the element of skill predominates over the element of chance. It is the dominant element –”skill” or “chance” — which determines the character of the game.”

Horse Race Betting: This form of betting was considered as a game of skill by an early ruling in 1957. “The expression “gaming” in the two Acts has to be interpreted in the light of the law laid-down by this Court in the two1957 cases, wherein it has been authoritatively held that a competition which substantially depends on skill is not gambling. Gaming is the act or practice of gambling on a game of chance. It is staking on chance where chance is the controlling factor. “Gaming” in the two Acts would, therefore, mean wagering or betting on games of chance. It would not include games of skill like horse racing”.

Lottery: ‘The Central Lotteries (Regulation) Act of 1998’ has granted state governments the authority to hold lotteries with restrictions: a maximum of one draw per week. However, most of the states exceed the number as majority of the states believe in creating their own laws on gambling. The Constitution of India grants Indian states the right to make policies related to gambling and betting.

Poker: Many academicians, theorists, mathematicians and historians have recognized Poker as a game of substantial skills. It can be construed as a mind sport, where strategies are quite similar to chess.

Noga Alon, a mathematician and professor at Tel Aviv University, analysed the probabilities and odds involved in the Poker hands. He said that a good poker player could calculate the probabilities of the cards and analyse the betting patterns of the opponents to decide the winning hand. It is a very complicated game that requires in-depth study of quantum mechanics, statistical analysis, game theory and human psychology.

Renowned economists Steven Levitt and Thomas Miles have expressed similarly views on Poker as a game of skill. They have analysed the statistics of the average winnings of skilled and un-skilled players in World Series of Poker. The results reveal that highly skilled players have achieved a return of investment of 30% while the un-skilled players have only 1.5% return of investment.

David Sklansky, the author of the canonical book “The Theory of Poker”, has argued that playing requires a certain degree of intellect and analytical skills. In his book, he demonstrates how the element of chance can be minimised by a statistical analysis and game theory.

Sports Betting

In the wake of recent match fixing scandals, there is a big initiative by many Indian administrative and judicial bodies to legalize sports betting. Many officials at FCCI and ICC are in the favour of legalizing and regulating sports betting, which could help the government fetch thousands of crores in revenue every year. We, at Indian Gaming Commission, are setting up the pioneering guidelines to regulate sports betting in India.