Thursday, November 16, 2023

Online Rummy and Poker: Games of Skill, Not Games of Chance - Madras HC Verdict

  1. Background and Legislative Authority:

    • The impugned Act, in its entirety, is not considered ultra vires.
    • The State has the authority to legislate, prohibiting online gambling (games of chance), while also regulating online games of skill.
    • Definition of "online gambling" in Section 2(i) is limited to "games of chance," excluding games involving skill.
  2. Rummy and Poker as Games of Skill:

    • Games of rummy and poker, though involving cards, are deemed games of skill.
    • Section 2(1)(iv) of the Act is read down to exclude skill-based games like rummy and poker.
  3. Validity of Specific Act Sections:

    • Sections 7, 8, and 9 of the impugned Act are not declared ultra vires, as the State can legislate on games of chance.
    • The State failed to demonstrate the distinction between online and offline rummy and poker.
  4. Concerns Addressed:

    • State concerns about bots or dealer software manipulation lack substantive material.
    • The Schedule under Section 23, designating rummy and poker as games of chance, is set aside.
  5. Regulatory Authority:

    • State empowered to make regulations under Section 5 of the Act, providing restrictions on time, age, etc., for playing online games.
  6. Section 10 Upheld:

    • Section 10, requiring the State to identify online game providers and prevent games of chance, is not declared ultra vires.
    • State can take action against bots or dubious methods in rummy and poker play under Section 10.
  7. Verdict and Set Asides:

    • Writ petitions stand partly allowed; the prayer to declare the entire Act ultra vires is negated.
    • The Schedule designating rummy and poker as games of chance is set aside.
    • Sections 2(i) and 2(1)(iv) are restricted to games of chance, excluding skill-based games.