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Economic Times
2 days ago
- Business
- Economic Times
Madras HC upholds Tamil Nadu's restrictions on real money games
The Madras High Court on Tuesday upheld the Tamil Nadu online gaming authority's restrictions on real money games, including a ban on gameplay between midnight and 5 am, and mandatory Aadhaar verification, rejecting legal challenges by gaming companies. The development follows a February petition where companies challenged regulations that required mandatory KYC verification, Aadhaar authentication and restricted hours of gameplay. These restrictions were imposed under Sections 5(2) and 14(1)(c) of the Tamil Nadu Prohibition of Online Gambling and Regulation of Online Games Act, 2022.A division bench comprising Justices SM Subramaniam and K Rajasekar ruled that the State has the authority to make laws on online gaming under Entry 6 (public health and sanitation) and Entry 26 (trade and commerce within the State) of the State List in the Constitution, which covers matters exclusively under states' jurisdiction. In their arguments, Head Digital Works Pvt. Ltd., which develops online games of skill in India, and two other gaming companies, Junglee Games India Pvt Ltd, and WinZO, insisted that the current restrictions based on time, age and monetary factors are unconstitutional. Code of ethics and regulatory framework In March, ET reported that real money gaming industry bodies All India Gaming Federation (AIGF), E-Gaming Federation (EGF) and Federation of Indian fantasy Sports (FIFS), jointly came up with a 'code of ethics' encouraging responsible gaming practices. The gaming industry bodies include companies such as Dream11, My11Circle, Khelo Fantasy Live, SG11 Fantasy, WinZO, Games24X7, Junglee Games etc. The code of ethics had provisions similar to the curbs placed by the Tamil Nadu the new GST regime, the real-money gaming (RMG) industry faces a 28% GST levy on the deposits made by players on these platforms. Last September, India's top GST investigation agency, the Directorate General of GST Intelligence (DGGI), stated that the real money gaming sector topped the list of tax evasion, with dues to the tune of Rs 1.1 lakh crore. The agency issued show cause notices to 34 entities and took action against 118 Indian and 658 foreign companies. Trends shaping the RMG sector In FY22-23, India's largest RMG platform, Dream11, recorded gross gaming revenue of Rs 7,167 crore. Of this, Rs 976 crore was spent as promotional credits to players. There are close to 568 million users of online games in India, and nearly 25% of them are pay-and-play customers. In fiscal year 2023, the RMG segment in online gaming was estimated to be a $2 billion business. According to the latest EY-FICCI report, Esports and casual gaming grew to Rs 5,300 crore in 2024, and is projected to reach Rs 6,300 crore in 2025 and Rs 8,300 crore in 2026.
Time of India
2 days ago
- Business
- Time of India
Madras HC upholds Tamil Nadu's restrictions on real money games
The Madras High Court on Tuesday upheld the Tamil Nadu online gaming authority 's restrictions on real money games , including a ban on gameplay between midnight and 5 am, and mandatory Aadhaar verification, rejecting legal challenges by gaming companies. The development follows a February petition where companies challenged regulations that required mandatory KYC verification, Aadhaar authentication and restricted hours of gameplay. These restrictions were imposed under Sections 5(2) and 14(1)(c) of the Tamil Nadu Prohibition of Online Gambling and Regulation of Online Games Act, 2022. A division bench comprising Justices SM Subramaniam and K Rajasekar ruled that the State has the authority to make laws on online gaming under Entry 6 (public health and sanitation) and Entry 26 (trade and commerce within the State) of the State List in the Constitution, which covers matters exclusively under states' jurisdiction. In their arguments, Head Digital Works Pvt. Ltd., which develops online games of skill in India, and two other gaming companies, Junglee Games India Pvt Ltd, and WinZO, insisted that the current restrictions based on time, age and monetary factors are unconstitutional. Code of ethics and regulatory framework Discover the stories of your interest Blockchain 5 Stories Cyber-safety 7 Stories Fintech 9 Stories E-comm 9 Stories ML 8 Stories Edtech 6 Stories In March, ET reported that real money gaming industry bodies All India Gaming Federation (AIGF), E-Gaming Federation (EGF) and Federation of Indian fantasy Sports (FIFS), jointly came up with a 'code of ethics' encouraging responsible gaming practices. The gaming industry bodies include companies such as Dream11, My11Circle, Khelo Fantasy Live, SG11 Fantasy, WinZO, Games24X7, Junglee Games etc. The code of ethics had provisions similar to the curbs placed by the Tamil Nadu government. Under the new GST regime, the real-money gaming (RMG) industry faces a 28% GST levy on the deposits made by players on these platforms. Last September , India's top GST investigation agency, the Directorate General of GST Intelligence (DGGI), stated that the real money gaming sector topped the list of tax evasion, with dues to the tune of Rs 1.1 lakh crore. The agency issued show cause notices to 34 entities and took action against 118 Indian and 658 foreign companies. Trends shaping the RMG sector In FY22-23, India's largest RMG platform, Dream11, recorded gross gaming revenue of Rs 7,167 crore. Of this, Rs 976 crore was spent as promotional credits to players. There are close to 568 million users of online games in India, and nearly 25% of them are pay-and-play customers. In fiscal year 2023, the RMG segment in online gaming was estimated to be a $2 billion business. According to the latest EY-FICCI report, Esports and casual gaming grew to Rs 5,300 crore in 2024, and is projected to reach Rs 6,300 crore in 2025 and Rs 8,300 crore in 2026.
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Business Standard
3 days ago
- Business
- Business Standard
Madras High Court upholds Tamil Nadu's real-money gaming regulations
The Madras High Court on Tuesday upheld Tamil Nadu's regulations that impose time limits on real-money games (RMGs) such as rummy and poker. The state's regulations prohibit real-money gaming platforms from operating between midnight and 5 am. A Bench of Justice S M Subramaniam and Justice K Rajasekar dismissed the writ petitions filed by Esport Players Welfare Association and gaming companies such as WinZO, Head Digital Works, Junglee Games, and Games24x7. The High Court noted regulations framed by the Tamil Nadu Online Gaming Authority were not paternalistic but were intended to ensure the physical, mental, and financial well-being of the state's people. It said the petitioners' contention that no blanket hours were imposed on consuming content on OTT (over the top) platforms, unlike real-money games, was not sustainable because there were no monetary stakes involved. 'It is only in online RMGs where there are stakes involved (that) the players get attracted by the prospect of rewards, which could lead to addictive behaviour and, more often than ever, (the players) tend to get lost in the pleasure of the game,' the court observed. The court said there was no strong reason to dilute the need for Aadhaar-based authentication. This is required to verify the age of the participants, given that the law prohibits minors from playing real-money games. 'The scope for manipulation or deceit is less in Aadhaar verification (than in) other ID proofs,' it noted. It added the state was authorised to pass legislation to govern matters affecting the public health of its citizens, citing that games such as rummy and poker had created public-health risks in Tamil Nadu. An industry participant said: 'From the industry's perspective, the state's powers are restricted to betting and gambling. RMGs in India are a game of skill and not chance. By consequence, the powers to regulate online games of skill rest only with the Centre.' The person added that the ban hours prohibited professionals from playing in international tournaments. 'Players cannot play international tournaments held during the hours when the blanket ban is imposed (midnight to 5 am). They are missing out. The right to livelihood is in question,' the person added.
United News of India
3 days ago
- Business
- United News of India
Madras HC upholds TN govt online gaming rules
Chennai, June 3 (UNI) In a landmark judgment, the Madras High Court on Tuesday upheld the Tamil Nadu government's regulations on online real money gaming, rejecting multiple petitions filed by gaming companies and individuals challenging the state's right to impose such restrictions. A Division Bench comprising Mr Justices S.M. Subramaniam and K. Rajasekar ruled that the state has the constitutional authority to regulate online games in the interest of public health and safety. The court emphasized that the right to privacy is not absolute and that reasonable restrictions can be imposed to prevent social harm. The key provisions validated by the court include mandatory Aadhaar-based Know Your Customer (KYC) verification, a ban on playing online real money games between midnight and 5 a.m., and the enforcement of age and monetary limits for players. These measures, the government argued, are intended to curb gaming addiction, especially among youth. The petitioners—major gaming platforms like WinZO, Games24x7, Junglee Games, and Head Digital Works—contended that the rules were excessive and paternalistic. They also contended that the night-time ban and compulsory Aadhaar verification infringed on users' rights. The court, however, rejected these arguments, stating that the state must act when public welfare is at stake. This ruling could influence similar regulatory efforts in other Indian states and marks a significant moment in the ongoing debate over the legality and impact of online gaming platforms. It may be recalled several people in the State have ended their lives after losing large sums of money in only rummy and other games. UNI GV 1520
