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India’s Karnataka High Court overturns online gambling ban

India’s Karnataka High Court overturns online gambling ban

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In what has widely been seen as a positive boost for the online gaming industry in India, a division bench of the Karnataka High Court has struck down key amendments to the Karnataka Police Act 1963, brought in last year to ban all forms of gambling in the state, including online gambling.

In pronouncing this new order, Justice Krishna S Dixit described the proposed amendments as ‘Ultra Vires’, meaning beyond the power or authority of those proposing them. However, Justice Dixit went on to say: “Nothing in the judgment shall be construed to prevent an appropriate legislation from being brought about concerning the subject that is betting and gambling in accordance with the provisions of the Constitution.”

A stay on the new provisions of the Act had been sought, as it would place games of skill when played online in the category of games of chance. The state government has told the High Court that it will not take any ‘precipitating action’ under the new laws till the cases are decided. The state legislature passed a legislation to amend the Karnataka Police Act to impose a complete ban on gambling in the state in September, and the Amendment Act came into force on October 5th.

This new gaming law was challenged in Karnataka on the grounds that if played for prizes or bets, games of skill have been clubbed with games of chance. The counter argument was that as per the law laid down by the Supreme Court in 1957, competitive games of skill are business activities and protected under Article 19 (1) (g) of the Indian Constitution. It was also argued that individual states do not have ‘legislative competence’ to prohibit games of skill and that only games of chance can be regulated for gambling and betting.