‘Declare bill banning online gambling unconstitutional’

CHENNAI: The All India Gaming Federation moved the Madras High Court seeking an order to declare the Tamil Nadu Prohibition of Online Gambling and Regulation of Online Games Act, 2022, enacted by the Assembly as unconstitutional as it lacks the legislative competence and is violates the fundamental rights enshrined under article 14,19 and 21 of the constitution.

One of the largest associations of skill gaming companies in India with 69 companies as members, who offer various skill-based games to their consumers, the federation stated in their petition that the impugned Act, by its scheme and operation, has far-reaching implications on all members of the All India Gaming Federation, both within Tamil Nadu and across the country.

“The distinction between Games of Chance and Games of Skill is well settled. Complete prohibition of online skill games is impractical. Only the Union Government is competent to enact legislation regulating online gaming. The State of Tamil Nadu does not have the Legislative competence to enact the Impugned Act under Entry 34 of List II of Schedule VII of the Constitution of India. The Impugned Act cannot be termed to be legislation under Entry 1,2 or 6 of List II of Schedule VII. The categorisation of any online game involving stakes, irrespective of the level of skill, as a game of chance is impermissible legislation and contrary to the predominance test. The State of TN classifying Rummy and Poker as Games of Chance is manifestly arbitrary. The state has no legislative competence to regulate online gaming. The Act arbitrarily overlooks that Games of Skill played online cannot be considered a Game of Chance and it has been enacted without any basis or relevant material to justify its enactment. It does not take away the basis of the judgement of the court in Junglee Games and it is an ‘unreasonable’ restriction of fundamental rights and is contrary to the doctrine of proportion,” the petition stated.

A similar law passed by the AIADMK regime was struck down by the Madras High Court in August, 2021, on the grounds that there could not be a blanket ban on games of skill. But the court made it clear that the state legislature would be at liberty to enact a new legislation for regulating online games. Following this, the Legislative Assembly passed a bill in October, 2022, for a new law but it did not receive the assent of the Governor. The Assembly readopted the same bill and it received his assent in April 2023 leading to the present litigation.