Gambling or gaming in India was originally regulated by the Public Gambling Act, 1867 which is the central law on gambling presently, the power to legislate lies exclusively within the State Legislature. Pursuant to this power, most states in India have passed enactments laws.
It is to be noted that, while the Central Gambling Act and all the State Gaming Acts provide for an exemption in the nature of Saving of Games of Skill and substantially state that "nothing in this Act shall apply to games of mere skill wherever played".
Games of skill or mere skill are excluded from the applicability of Indian Gaming Laws which prohibits only betting and gambling in all Indian states to the exception of a few ('Betting and Gambling' being a state subject under the Constitution of India).
Rummy has been declared to be a game of skill or mere skill by the Hon'ble Supreme court of India vide various Judgments. Further, recent high courts judgements also clarify that fantasy game is a game of skill.
Definition of Skill:
The Supreme Court has explained skill in terms of superior knowledge, training, attention, experience and adroitness.
The Supreme Court, while carving out a distinction between a game of chance and a game of skill, stated that - 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.
What is gambling and how is it different from Skill Games under Indian laws?
Gambling or gaming has been defined by the Supreme Court in 1996 as betting and wagering on games of chance only. The Supreme Court in this judgement specifically excludes games of skill, irrespective of whether they are played for money or not, from the definition of gambling.
It is pertinent to refer judgement passed by S.R. Das, Chief Justice in the case of "State of Bombay v. RMD Chamarbaugwala, AIR 1957 SC 699".
The competitions which involve substantial skill are not gambling activities. 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. 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.
A prize competition for which a solution was prepared beforehand was clearly a gambling prize competition, for the competitors were only invited to guess what the solution prepared beforehand that is to say, the prize competitions for which the solution was determined by lot, was necessarily a gambling adventure or any other competition success which does not depend upon the exercise of skill", constituted a gambling competition. At one time the notion was that in order to be branded as gambling the competition must be one success in which depended entirely on chance. If even a scintillas of skill was required for success the competition could not be regarded as of a gambling nature.'
The Hon'ble Supreme Court in the matter of Dr. K.R. Lakshmanan v. State of Tamil Nadu, (1996) 2 SCC 226 opined that gambling amounted to the payment of a price for a chance to win a prize, and referred to a game of chance being one that is determined entirely or in part by lot or by mere luck. A game of skill, on the other hand, may necessarily involve an element of chance, but the success therein would depend principally upon the superior knowledge, training, attention, experience and adroitness of the player.
The Hon'ble Madras High Court recently held in Junglee Games India Private Limited & Anr. v. The State of Tamil Nadu, 2021 SCC OnLine Mad. 2767 that irrespective of what meanings are ascribed to these words in dictionaries, gambling is equated with gaming and the activity involves chance to such a predominant extent that the element of skill that may also be involved cannot control the outcome. A game of skill on the other hand, may not necessarily be such an activity where skill must always prevail; however, it would suffice for an activity to be regarded as a game of skill if, ordinarily, the exercise of skill can control the chance element involved in the activity such that the better skilled would prevail more often than not. The vagaries of the unknown and unpredictable, and yet possible, must be kept out of consideration to determine whether an activity is a game of skill.
Can games of skill be undertaken as Business Activity?
A game of skill, not being gambling, is a business activity, which is accorded due protection under the Constitution of India.
The Supreme Court in R.M.D. Chamarbaugwala v. Union of India, AIR 1957 SC 628, held that the competitions which involve substantial skill are business activities, the protection of which is guaranteed by Art. 19(1)(g) of the Constitution of India.
The Hon'ble High Court in "D. Krishna Kumar & Anr. V. State of Andhra Pradesh, 2002 (5) ALT 806" have upheld that 'Rummy' is a 'Game of Skill' and therefore, prize competitions which involve substantial skill are business activities that are protected under Article 19(1)(g) of the Constitution of India
There cannot be any reasonable doubt that the law enacted by the State Legislature was one to control and regulate prize competitions of a gambling character and not competitions in which success depended substantially on Skill.
Also, The Punjab & Haryana High Court in the Varun Gumber v. Union Territory of Chandigarh and others (Decided on April 18, 2017) court held that conducting online fantasy leagues, being 'games of skill' was a business activity, with due registration and payment of service tax and income tax, thus, is accorded protection by Article 19 (1)(g) of the Constitution of India.
Is rummy a game of skill under Indian Laws?
Game of Skill or Mere Skill have been exempted under various state laws and the Supreme Court on this subject decisively settled that the game of rummy is not a game of entire chance, it is mainly and preponderantly a game 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". The same has been decided in above "State of Bombay v. RMD Chamarbaugwala, AIR 1957 SC 699" case.
Rummy requires certain amount of skill because the fall of the cards has to be memorized and the building up of Rummy requires considerable skill in holding and discarding cards. We cannot, therefore, say that the game of Rummy is a game of entire chance. It is mainly and preponderantly a game of skill. Refer "State of Andhra Pradesh v. K. Satyanarayana and Ors., AIR 1968 SC 825" held by Hon'ble Supreme Court of India, while dealing with the provisions of the Hyderabad Gambling Act, 1305.
Is fantasy game a game of skill under Indian Laws?
Fantasy game has been held to be a 'game of skill' which would require adequate expertise, attention, judgment and prior knowledge of the sport.
The Punjab & Haryana High Court in the Varun Gumber v. Union Territory of Chandigarh and others (Decided on April 18, 2017) held that the fantasy game under consideration therein would amount to a 'game of skill' which would require adequate expertise, attention, judgment and prior knowledge of the sport. The case was appealed before the Supreme Court, which dismissed the appeal, without hearing on the merits of the case.
Further, the Bombay High Court, in March 2019 delivered its judgement in the case of Gurdeep Singh Sachar v. Union of India & Ors. (Cr. PIL St.22.19) in a matter that pertained to a fantasy league game which involved a user selecting a team of 11 players from two teams of the real-world players. The drafting of each virtual team involved spending a set of fixed credit points. The Court observed that the fantasy game does not amount to gambling, as the same involves skill set of the users on a host of parameters and practical knowledge as to the players of the real world.
Is it legal to play a game of skill (including rummy and fantasy sports) for cash on www.a23.com?
- Games of skill are exempt from the penal provisions of most gaming/gambling acts. Rummy doesn't come under betting or gambling and it's legal.
- A game of skill is a business activity and hence can be played for cash.
- Rummy unveils that Skill is a predominant factor than Chance
- Rummy is a skill based game where players show their real-time skills at the table by arranging the 13 cards in the proper sequences or sets and discarding the cards.
- Fantasy game would amount to a 'game of skill' which would require adequate expertise, attention, judgment and prior knowledge of the sport.
The Supreme Court has held that 'gaming' in the context of the Act would mean wagering or betting on games of chance, and it would not include games of skill, and in view of the specific provision and legislative intent reflects that the games of mere skill are exempted from all of the penal provisions of the Act. With all such inferences, it can be concluded that it is legal to play skill based games on A23.
However, we further wish to inform you that A23 does not allow players from Assam, Nagaland, Sikkim, Telangana and Andhra Pradesh to play on its website. "The Assam Game and Betting Act, 1970" & "Prevention of Gambling Act, The Nagaland Online Gaming Act, 2016, and Sikkim On-line Gaming (Regulation) Act, 2008 envisage a licensing regime for specified skill games. If you would like to seek any further clarification on legality, please feel free to write to us on: legal@hdworks.in
References:
- Dr. K. R. Lakshmanan v. State of Tamilnadu and others.
- State of Andhra Pradesh v K. Satyanarayana & Ors
- M. J Sivani v State of Karnataka
- R. M. D. Chamarbaugwalla vs The Union Of India
- D. Krishna Kumar & Anr. V. State of Andhra Pradesh, 2002 (5) ALT 806
- Varun Gumber v. Union Territory of Chandigarh and others (Decided on April 18, 2017)
- Gurdeep Singh Sachar v. Union of India & Ors. (Cr. PIL St.22.19)
- Junglee Games India Private Limited & Anr. v. The State of Tamil Nadu, 2021 SCC OnLine Mad. 2767
