Allahabad HC asks UP govt to form panel over online gaming, betting regulation
Prayagraj, The Allahabad High Court has directed the Uttar Pradesh government to constitute a high-powered committee to examine whether there was a need to regulate online gaming and betting.
Justice Vinod Diwaker's direction came after he observed that the existing Public Gambling Act, 1867 was a colonial-era law that addresses only conventional forms of gambling like card games.
The court said the panel would be headed by Professor K V Raju, the economic advisor to the Uttar Pradesh government and may include the principal secretary as member secretary besides other experts as members.
The direction came after two persons, including one Imran Khan, sought quashing of gambling charges and criminal proceedings.
The duo was accused of running an online betting racket from home and earning crores of rupees leading the locals in Agra to gamble away their earnings.
The court observed a law must be enacted to meet the transformative changes in online betting and gaming and took a suo-motu cognisance of the issue.
"The Public Gambling Act is a pre-digital law. It makes no mention of digital platforms, servers, or cross-border transactions. Its enforcement is limited to physical gambling houses and has no jurisdiction over virtual gambling environments accessed via mobile phones, computers, or offshore servers," it added.
The court observed in the era of online gambling, the existing law has lost its impact and relevance, as there exists no definition or regulation of online gambling.
It also highlighted that the law presently only provides for negligible penalties, which do not deter large-scale operations.
"There is a lack of clarity on the legal status of fantasy sports, poker, and e-sports. Jurisdictional issues also arise, as online platforms operate across state, national, and international boundaries," the court added.
Fantasy sports in India are stated to be in a legal grey area, straddling the line between games of skill and games of chance .
The court also flagged the use of psychologically manipulative algorithms, reward systems, and notifications by online gaming platforms to encourage prolonged use.
This has led to a rise in gaming addiction, anxiety, depression, and social isolation, especially among adolescents and young adults, it said.
"Students are increasingly distracted by online gaming, often at the cost of their academic performance and family relationships. The disruption of sleep cycles, lack of discipline, and social withdrawal are common consequences," the court added.
The judge noted several online betting operations function outside India's jurisdiction, with servers located abroad and transactions routed through unregulated channels.
This poses challenges for law enforcement and increases the risk of money laundering, financial fraud, and terror funding, it observed.
A modern, technology-sensitive legislation was therefore urgently needed to address the psychological, social, and national security implications of online gaming, it added.
On the merits of the case against the accused, the court observed since it involved a non-cognisable offence, the police could not have probed it without an order of the magistrate.
The court in its decision passed last month quashed the proceedings against the accused but the police was granted the liberty to initiate a fresh investigation after complying with the law.
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