Precinct of Indian Law on Online Games

The game of Chaturanga popularised by the ancient mythological treatise of Mahabharata in 400 BC, finds a mention in the religious texts of Rig Veda and Atharvana Veda both written in 1500 BC. Hindu mythology is replete with references to gambling as an intrinsic part of life and has left an indelible mark on the Indian civilization. It is perhaps befitting to know along with the Greek and Roman Civilizations, Indian civilization was amongst the first to embrace gambling as an integral part of our life.

Estimates suggest that India's mobile games market will be worth $1.1 billion by 2020, and number of users projected to become 628 million by then. 

 Gambling is a state subject, and only states in India are entitled to formulate laws for gambling activities within their respective states. The Public Gambling Act of 1867 is a central law that prohibits running or being in charge of a public gaming house. Interestingly the expression ‘gaming’ has been interpreted by the Supreme Court of India, wherein it has been authoritatively held that a competition which substantially depends on ‘skill’ is not gambling.

 The Supreme Court of India clearly laid down that (i) the competitions where success depends on substantial degree of skill are not ‘gambling’ and (ii) 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”. It was held, that the expression “mere skill” would mean substantial degree or preponderance of skill.

 The Supreme Court of India has, for instance, held that the game of Rummy is not a game entirely of chance like the ‘three-card’ game. The ‘three card’ game which goes under different names such as ‘flush’, ‘brag’ etc. is a game of pure chance. Rummy, on the other hand, requires a certain amount of skill because the fall of the cards has to be memorised and the building up of Rummy requires considerable skill in holding and discarding cards. It was said that the game of Rummy is not a game of entire chance. It is mainly and preponderantly a game of skill.

 Recently an Indian High Court held that fantasy sports platform Dream11 is a game of skill in a judgement. The court also noted that since fantasy sports is not gambling, it is a business activity that is afforded the protection of right to free trade and commerce guaranteed under Article 19(1)(g) of the Constitution of India. The Supreme Court of India dismissed the Special Leave Petition against the High Court judgment.

 India is a very promising market vis-à-vis online gaming subject to you play within the rules of the game. We can name it ‘Skill Gaming’ which will witness immense growth in the gaming industry. Digital Ad spending in India in 2018 is 134.3 (in billions) and Mobile Internet Ad spending is 55.4 (in billion).