TaxTMI 
TaxTMI 
2026 (5) TMI 1821
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....Agarwal, Adv., Mr. Rishi Agrawala,, Adv., Mr. Anshuman Srivastava, Adv., Mr. Abhinabh Garg, Adv., Mr. Shivam Shukla, Adv., Ms. Manavi Agarwal, Adv., Mr. E. C. Agrawala, AOR, Mr. Neeraj Kishan Kaul, Sr. Adv., Ms. Mansi Sood, Adv., Mr. Rajat Jariwal, Adv., Ms. Prerna Singh, Adv., Ms. Ayushi Khurana, Adv., Mr. Dev Vijay Chand, Adv., Mr. Raghav Agrawal, Adv., Ms. Dhanya Krishna, Adv., Mr. Sujoy Chatterjee, AOR, Mr. D. L. Chidananda, AOR, Mr. Gopal Sankaranarayanan, Sr. Adv., Dr. Abhishek Manu Singhvi, Sr. Adv., Mr. Suhaan Mukerji, Adv., Mr. Adarsh Kumar, Adv., Mr. Abhishek Manchanda, Adv., Mr. L Nidhiram Sharma, Adv., Mr. Sayandeep Pahari, Adv., Ms. Trisha Chandran, Adv., Mr. Tanmay Sinha, Adv., Ms. Vanshika Jain, Adv., Mr. Shourya Dasgupta, Adv., M/s Plr Chambers And Co., AOR, Mr. S. Mukherjee, Adv., Mr. Harsh H. Gurusahani, Adv., Mr. Adarsh Kumar, Adv., Mr. Sayandeep Pahari, Adv., Mr. Tanmay Sinha, Adv Mr. Chandan Pandey, Adv., 3 C.A.Nos.6124-6131/2023 Dr. Vinod Kumar Tewari, AOR, Mr. Dilip Singh, Adv., Mr. R Karthik, Adv., Mr. Pramod Tiwari, Adv., Mr. Vivek Tiwari, Adv., Ms. Priyanka Dubey, Adv., Mr. Sk Warish Ali, Adv., Mr. Abhishek Malhotra, Sr. Adv., Ms. Aanchal Tikmani, AOR, Mr.....
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....mmunity, Potentiality Test 209 e. "Concentric Circles" Doctrine 220 f. Social and Economic Disorder 226 g. Proximate Nexus Requirement 234 h. Public Order in the Age of Internet, Computer, and Cyber Laws 242 i. Ingredients of Public Order Culled Out 251 H. CONCLUSION 262 1. Leave granted. 2. Since the issues involved in all the captioned appeals are the same those were taken up for hearing analogously and are being disposed of by this common judgment and order. A. FACTUAL MATRIX C.A. NOS. 6124-6131 OF 2023 @ SLP(C) NOS. 19981-19987 OF 2021 (STATE OF TAMIL NADU & ORS. vs. JUNGLEE GAMES INDIA PVT. LTD. & ORS.) AND CIVIL APPEAL NOS. 8275 - 8279 OF 2026 OF 2026 @ SLP(C) NOS. 1588-1592 OF 2024 (STATE OF TAMIL NADU & ORS. vs ALL INDIA GAMING FEDERATION & ORS.) 3. The aforesaid appeals, i.e., C.A. Nos. 6124-6131 of 2023, arise from the judgment and order passed by the High Court of Madras dated 03.08.2021 in WP No. 18022 of 2020, WP NO. 18029 OF 2020, WP NO. 18044 OF 2020, WP NO. 19374 OF 2020, WP NO. 19380 OF 2020, WP NO.7354 OF 2021, WP NO. 7356 OF 2021, WP NO. 13870 OF 2021 by which the High Court struck down Part ....
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....he Tamil Nadu Gaming Act, 1930 (Tamil Nadu Act III of 1930) and to extend its application throughout the State and to make consequential amendments to the Chennai City Police Act, 1888 (Tamil Nadu Act III of 1888) and the Tamil Nadu District Police Act, 1859 (Central Act XXIV of 1859)." (Emphasis Supplied) 7. The 2021 TN Amendment Act introduced a few modifications to the 1930 Gaming Act in order to prohibit online betting and gambling activities. The modifications are as follows: a) Section 3(b), which defined gaming, was amended to include all forms of betting or wagering on any game played, even in cyberspace, using electronic transfer of funds. The provision is reproduced hereunder: "(b) "gaming" does not include a lottery, but includes any game involving wagering or betting in person or in cyber space. Explanation.- For the purposes of clause (b) and section 3-A, wagering or betting shall be deemed to comprise the collection or soliciting of bets, the receipt or distribution of winnings or prizes, in money or otherwise, including through electronic transfer of funds, in respect of any wager or bet, or any act which is intended to aid, ind....
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.... of the 1930 Gaming Act. 9. Prior to the amendment, Section 11 of the 1930 Gaming Act had protected games of skill by an express carve-out clause that exempted the application of the Act to games of mere skill. Prior to the amendment, the Section read as follows: "Nothing in sections 5 to 10 of this Act shall be held to apply to games of mere skill wherever played." 10. In lieu of the amendment, this protection clause was removed. By removing the protection clause and amending the definition of gaming to extend to cyberspace as well, the State made it an offence to wager or bet on any game, which includes a game of skill. iii. Findings of the High Court of Madras in Junglee Games 11. The online gaming companies had challenged the constitutional validity of the 2021 TN Amendment Act on the ground that it was infringing their fundamental rights and also because the legislation was manifestly arbitrary as it clubbed together games of skill and games of chance under one bucket. 12. The High Court first held that the term gambling connotes taking a chance and also acknowledged that, in the usual sense, there is no distinction between skill or chance in order for ....
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....arnataka dated 14.02.2022 by which the writ petitions preferred by the respondents herein (original petitioners/gaming companies) seeking to challenge the validity of the Karnataka Act No. 28 of 2021 came to be allowed in the following terms: "a. The provisions of Sections 2, 3, 6, 8 & 9 of the Karnataka Police (Amendment) Act 2021 respectively, i.e., the Karnataka Act No.28 of 2021 are declared to be ultra vires the Constitution of India in their entirety and accordingly struck down. b. The consequences of striking down of the subject provisions of the Karnataka Police (Amendment) Act 2021 i.e., Karnataka Act No.28 of 2021 shall follow. However, nothing in this judgment shall be construed to prevent an appropriate legislation being brought about concerning the subject i.e., 'Betting & gambling' in accordance with provisions of the Constitution. c. A Writ of Mandamus is issued restraining the respondents from interfering with the online gaming business and allied activities of the petitioners." iv. Legislative framework of the 1963 Police Act 20. The Karnataka Police Act, 1963 (hereinafter, "the 1963 Police Act"), was amended by the Karnataka Police....
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....act or risking money, or otherwise on the unknown result of an event including on a game of skill and any action specified above carried out directly or indirectly by the playing any game or by any third parties." (Emphasis Supplied) b) The definition of "instruments of gaming" under Section 2(11) was amended to include computers, computer systems, mobile apps, internet, cyberspace and other virtual communication devices. Section 2(11), as amended by the 2021 Karnataka Amendment Act is reproduced hereunder: "Instruments of Gaming" includes any article used or intended to be used as a subject or means of gaming, including computers, computer system, mobile app or internet or cyberspace, virtual communication device, electronic applications, software and accessory or means of online gaming, any document, register or record or evidence of any gaming in electronic or digital form, the proceeds of any online gaming as or any winning or prizes in money or otherwise distributed or intended to be distributed in respect of any gaming. Explanation-The words 'computer', 'communication device', 'computer network', 'computer resource', 'computer system', 'cyb....
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....n devices. The provision, as it stands amended by the 2021 Karnataka Amendment Act, reads as follows: ""Place" includes a building, a tent, a booth or other erection, whether permanent or temporary, or any area, whether enclosed or open including a recreation club or on virtual platform, mobile app or internet or any communication device, electronic application, software, online gaming and computer resource as defined in Information Technology Act, 2000 (Central Act 21 of 2000) or under this Act." (Emphasis Supplied) f) Section 78(1)(a) of the 1963 Police Act was amended to punish the owner of online gaming platforms that involve wagering or betting when such a platform is used for the purpose of gaming. Sub-clause (vi) of Section 78(1)(a) penalized any transaction or scheme of wagering/betting in which the receipt or distribution of winnings or prizes in money or otherwise is dependent on chance or skill of other. Sub-clause (vii) of Section 78(1)(a) penalized any act of risking money or otherwise on the unknown result of an event, including on a game of skill. The punishment for the aforementioned offence was imprisonment for up to one year or a fine th....
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.... Police Act. The consequences of the amendments are as follows: a) The platforms of the online gaming companies, which are virtual software applications, were brought under the ambit of common gaming houses by amending the definition of the phrase "place". b) Computers, mobile phones, internet and cyberspace have now been brought under the ambit of the definition "instruments of gaming". c) The phrase "gaming" under Section 2(7), means all forms of wagering or betting using money, tokens valued in terms of money and every other form of virtual currency and electronic transfer of funds. The explanation to the provision makes it very clear that collection, soliciting, receipt or distribution, any act or risking money, or otherwise on the unknown result of an event including on a game of skill would constitute wagering or betting and would therefore squarely fall within the definition of gaming. d) Section 2(12A) introduces the definition for online gaming. The provision makes it very clear that all forms of gaming, as defined under Section 2(7), when played with instruments of gaming like computers, applications and mobile phones or other virtual p....
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....hat gambling is something, by its very nature, that does not depend upon the exercise of skill. Therefore, as a natural corollary, anything that depends on skill cannot be termed as gambling. 27. Games of skill do not metamorphize into games of chance merely because they are played online. Therefore, the judgment of this Court in MJ Sivani & Ors. v. State of Karnataka & Ors. reported in AIR 1995 SC 1770, cannot be the best guide to distinguish online games and physical games. 28. Games of skill and games of chance are two distinct legal concepts of constitutional significance. 29. The High Court opined that when the State is planning such a drastic measure to curb online games of skill when played with stakes, it had to conduct a scientific and empirical study to analyze the ill-effects of online gaming and its socio-economic impact. 30. The Court held that online gaming activities, whether played with or without stakes, do not fall under Entry 34 List II if they predominantly involve skill, knowledge or judgment. These activities partake the character of business activities which have constitutional protection under Article 19(1)(g). Games of skill are entitled to prot....
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....e populations from predatory online practices, and preserving economic stability through regulation of virtual gambling activities. The physical sense of "public order" in Entry 1 List II must, therefore, be interpreted broadly to address the cross border and exponential impact of online gaming platforms. 38. Mr. Sibal placed strong reliance on the decision of this Court in Rev. Stainislaus v. State of Madhya Pradesh, reported in (1977) 1 SCC 677 to contend that "public order" in Entry 1 List II has a wide connotation. He highlighted that in this judgment, a law against forcible conversions was upheld under Entry 1 without requiring any further proof of widespread incidents, demonstrating that preventive legislation can be justified under "public order" without epidemic evidence of harm. 39. He submitted that the factual basis for invoking public order includes: (1) suicides linked to online gaming and gambling addiction; (2) financial distress of families; (3) exploitation arising from the addictive design of online games and inducement to squander money; and (4) psychological and physiological harms such as aggressive behaviour, poor eyes....
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....o subjects of "sports, entertainments and amusements". Online games and online gambling are characterised as modern forms of entertainment, thereby squarely falling within this entry and therefore within the State's legislative competence. 45. He submitted that the impugned orders are per incuriam to the extent it holds that, under Entry 34 List II, the State lacks competence unless both "betting" and "gambling" are involved. The High Court has misapplied the dictum laid in K.R. Lakshmanan (supra) because the said decision nowhere lays down that a State Legislature cannot legislate on "betting" independent of "gambling". 46. He submitted that the impugned orders are incorrect in two tangents: (a) its reading of RMDC-I (supra), RMDC-II (supra), and K.R. Lakshmanan (supra) as foreclosing the State's power over betting on games of skill; and (b) its conclusion that "betting" on a game of skill is itself an activity where success depends on skill, so that Entry 34 does not cover betting on games of skill. Both these strands are asserted to be contrary to this Court's jurisprudence and thus per incuriam. 47. He argued that the Entries in the Seventh Schedule m....
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....ued that the statute imposes reasonable restrictions in the interest of the general public and the State seeks to rely on the doctrine of proportionality, as applied in M.R.F. Ltd. v. State of Kerala reported in 1998 (8) SCC 227, and subsequent cases wherein it was held that the restrictions balance the right to carry on business with the State's obligation to protect public interest from the harms of online gambling. 52. He argued that in K.S. Puttaswamy v. Union of India reported in (2017) 10 SCC 1 and (2019) 1 SCC 1, it has been held that no fundamental right, including the right to privacy, is absolute and that the proportionality test governs restrictions. The TN Online Gambling Act 2022/23 could be said to satisfying the legitimate aim, rational connection, necessity, and balancing, given the documented harms of online gambling and availability of empirical material placed by the State, including the various instances of suicides and addiction-related debt. 53. In the last, the learned Senior counsel submitted that the respondents' argument that the TN Online Gambling Act 2022/23 fails the "least intrusive" limb of proportionality deserves to be rejected as the State ha....
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....ine environment, a player is always placing a bet on an inherently unknowable outcome, including uncertainty on whether opponents are individuals, prodigies, or bots, or are even aided by AI. This heightens the gambling-like character of such activity and justifies regulatory intervention. 60. The State can trace its legislative competence to enact the impugned legislation primarily under Entry 34 of List II ("Betting and gambling"), and, alternatively or cumulatively, under Entries 1 (Public order), 2 (Police), 6 (Public health), 26 (Trade and commerce), and 33 (Sports, entertainments, amusements) of List II, together with Article 246(3). 61. Even if the respondent's plea is accepted that the impugned subject matter does not fall under Entry 34, that does not negate competence because the subject may still fall within other State entries. If the legislation can be traced to even one valid State entry, competence is established. Reliance is placed on Mineral Area Development Authority v. SAIL reported in 2024 INSC 554, wherein this Court had held that: a) entries in the Seventh Schedule are to be interpreted broadly and liberally, covering all reasonable facets and a....
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....ulate games and entertainment activities offered online to the public. 67. The 2021 Karnataka Amendment Act amends the following definitions to bring the online architecture of gaming within the enforcement ambit of the Act: a) "Common gaming house" in Section 2(3) covers any place where instruments of gaming are kept or used for profit or "otherwise" of the person owning or using such place, including subscription or other payment-based models; b) "Gaming" in Section 2(7) explicitly covers "online games involving all forms of wagering or betting" and defines "wagering or betting" to include any act of risking money on unknown results of any event, "including on a game of skill"; c) "Instruments of gaming" in Section 2(11) includes computers, computer systems, mobile apps, internet, cyberspace, virtual communication devices, electronic applications, and associated software and digital records of gaming proceeds; d) "Online gaming" in Section 2(12A) and "place" in section 2(13) are extended to virtual platforms and computer resources as defined in the IT Act, 2000. 68. Sections 78, 79, 80, and 87 of the 1963 Police Act respectively, are stre....
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....-6143 of 2023: 73. The impugned Tamil Nadu and Karnataka amendments, and the TN Online Gambling Act 2022/23, define "gaming" as the playing of online games for winning money or other stakes thereby obliterating the distinction between games of skill and games of chance. 74. The impugned enactments impose a blanket ban on online rummy, are not regulatory in character, and fall outside the State legislative competence. 75. The States' claim to legislate on all online games under Entries 1, 2, 6, 26, 33 and 34 of List II is incorrect because they may legislate only on "betting and gambling" (Entry 34, List II), which is confined to games of chance. Games involving a substantial or preponderant degree of skill, on the other hand, fall outside this Entry and are protected as legitimate business under Article 19(1)(g) of the Constitution, not as res extra commercium gambling activities. 76. The expressions "betting and gambling", "gaming", "games of skill" and "games of chance" stand conclusively interpreted in the following cases: * RMDC-I (supra), which interpreted "betting and gambling" in Entry 34, List II and upheld taxation of gambling but excluded competitions....
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.... betting in relation to gambling (games of chance), and not to betting in relation to games of skill, which remain constitutionally distinct. 85. The States' main counter-contention is that "betting and gambling" in Entry 34 should be read disjunctively as "betting or gambling", so that "betting" covers all betting, including on games of skill, while "gambling" covers games of chance. On this reading, the State claims competence over both classes of games. 86. This disjunctive reading is flawed because it implies that any game played for stakes, including skill-based games like rummy or even chess, would fall within "betting and gambling", directly contradicting RMDC-I (supra), RMDC-II (supra) and K.R. Lakshmanan (supra) and nullifying long-recognised statutory and judicial exceptions for games of skill. 87. The States' disjunctive construction is also inconsistent with the Parliament's own usage in Section 65B(15) of the Finance Act 1994, where "betting" and "gambling" are used together to denote staking money or otherwise on outcomes determined by chance or accident. The Parliament does not treat "betting" on games of skill as falling within "betting and gambling" for ta....
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....mbling Act 2022/23 regulating online gaming, other than those that which deem games of skill to be games of chance, are not under challenge and are upheld. In substance, the TN Online Gambling Act 2022/23 is tailored to overcome and nullify the earlier decision in Junglee Games (supra), rather than to genuinely address online gambling. 94. With respect to stakes, betting and gambling, the jurisprudence over the last 150 years demonstrates that there has never been any legal objection or controversy to the presence of stakes or consideration in games of skill. The only consistent controversy has been whether an activity is a game of skill or a game of chance, and legislative prohibitions have historically targeted only games of chance. 95. If the Parliament or a State Legislature cannot, for regulatory purposes, reclassify games of skill as games of chance, they equally cannot do so for taxation purposes. Treating games of skill as gambling would require an appropriate constitutional amendment. The mere fact that there is betting, staking or consideration involved in playing a game of skill cannot by itself convert such activity into "gambling". D.3. Submissions of Ld. Seni....
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....N Amendment Act, by which Section 3A was inserted to the 1930 Gaming Act and Section 11 of the said Act was amended as well as the 2021 Karnataka Amendment Act by which Section(s) 2(7), 78(1)(a)(vi)-(vii) and 176 of the 1963 Police Act respectively were amended, in effect penalise staking on games of skill and thus, directly restrict protected expression and profession, requiring strict justification under Articles 19(2) and 19(6) respectively. 103. The State has failed to relate the restrictions to any Article and to justify their proportionality. Criminal penalties and complete bans on online games of skill played for stakes are wholly disproportionate, particularly when detailed regulatory mechanisms under the IT Act demonstrate less restrictive alternatives. 104. The IT Rules already provide calibrated measures to address concerns such as sovereignty, public order, user harm, child protection, gaming addiction, financial loss and fraud (through warnings, self-exclusion, parental controls, and age-rating), illustrating that a complete ban under State laws is unnecessary and excessive. 105. The impugned Acts are discriminatory and manifestly arbitrary under Article 14 be....
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....o skill is involved and which depends on the outcome of an uncertain event, whereas a game of skill (such as bridge or rummy) involves memorising cards, testing the strength of the other side and using strategy. Rummy has been judicially recognised as a game mainly and preponderantly of skill, despite an element of chance in the deal of the cards. 113. For the last 75 years, games like rummy, earlier played physically, have been held to be games "predominantly of skill", and therefore games like poker, rummy and Fantasy Sports ("FS") are completely games of skill. 114. FS is an internet-based team-selection contest, played over a predetermined number of rounds (from a single match/event to an entire league/series), in which the user acts as a coach/selector of a virtual team of real players from real teams, and competes against other users' virtual teams, not against the FS platform (no house). 115. Outcomes in FS contests are tabulated solely on the basis of statistics, scores, achievements and performance of real players in designated professional sporting events, with users selecting and curating teams using parameters such as player form, pitch conditions, historical d....
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....als in White v. Cuomo reported in 2022 NY Slip Op 01954 held that "gambling" encompasses staking value on a game where chance predominates over skill or risking value through bets/wagers on contests of skill where the wagered pool is awarded based on future events outside the wagerer's control, and clarified that games in which skill predominates and skill-based competitions for predetermined prizes where participants influence outcomes do not constitute gambling. FS falls within this non-gambling category. 123. The Illinois Supreme Court in Colin Dew-Becker v. Wu reported in 2020 IL 124472 examined three tests (predominant factor test, material element test, any-chance test) to distinguish skill from chance, rejected the any-chance and material-element tests as overbroad/subjective, adopted the predominant factor test as the most appropriate, and concluded that head-to-head DFS contests are predominantly determined by skill, and thus do not amount to "gambling" under the relevant statute. 124. Since 1822, Indian gambling legislation has consistently excluded games of skill from the ambit of "gambling" and "betting", this long-standing legislative policy confirms that skill-b....
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....e user participation irrespective of location. They inherently constitute inter-State trade and commerce, which States cannot regulate under their intra-State trade entry. 131. The Parliament is also competent under Union List Entry 97 (residuary power) because no specific entry in any of the three Lists directly addresses online gaming or FS. Given the technological complexity and novelty of online gaming and the absence of an express State List entry, regulation of such platforms necessarily falls within the Parliament's residuary domain. 132. Independent regulation of online gaming by individual States, by invoking State List entries, would result in regulatory chaos and duplicative compliance obligations for pan-India online platforms, which is inconsistent with the constitutional allocation of such cross-border, technology-based activities to the Union under Entries 31, 42 and 97 of the Union List. 133. The entries in the Lists of the Seventh Schedule are fields of legislation, not self-standing powers, and one entry cannot be interpreted so expansively as to cancel, obliterate, or render meaningless another entry in the same or another List. The States' construction ....
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....tside this entry. 138. It is contended that Entry 34 is a single composite expression. Therefore, "betting" is not a distinct, free-standing subject but is conjunctively linked with "gambling", and the use of "and" (instead of "or") shows legislative intent to regulate betting only when it is integrally connected with gambling activities. Since the impugned amendments extend their operation to games of skill (including online skill-based formats with monetary stakes), they travel beyond "betting and gambling" in Entry 34 and therefore lie outside State legislative competence under Article 246(3). 139. The 2021 Karnataka Amendment Act, by imposing a blanket embargo on all online games with stakes (including those that are games of skill), directly impacts the fundamental right to carry on trade or business under Article 19(1)(g) of operators like respondent No. 2 who exclusively conduct skill-based online gaming and e-sports activities. This amounts to a total ban, and, therefore, fails the test of reasonable restrictions under Article 19(6). 140. Insofar as the 2021 Karnataka Amendment Act imposes a total embargo on offering or participating in such online games of skill f....
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....atute; b) Introduces Section 3A, imposing a blanket prohibition on wagering or betting in cyberspace for rummy, poker or any other game, without distinguishing games of skill from games of chance; c) Amends Section 11 to remove the exemption for games of mere skill and subjects them to a total ban when played for wager, bet, money or stakes, notwithstanding their skill-based nature. 146. The Madras High Court's judgment dated 03.08.2021 correctly held that: a) The business of organising or offering games of skill is a protected occupation under Article 19(1)(g), while the game of skill itself may attract protection under Article 19(1)(a); b) Competitions involving substantial skill are not "gambling" and thus fall outside Entry 34 List II, being protected as trade or business under Article 19(1)(g), in line with K.R. Lakshmanan (supra); c) The 1930 Gaming Act's original scheme, which confined "gaming" to games of chance, was impermissibly inverted by outlawing all games played for stakes, ignoring the constitutionally relevant distinction between skill and chance. 147. The Madras High Court correctly held that under Entry 34 List I....
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....ed that: a) Games of skill are business activities protected under Article 19(1)(g), as recognised in RMDC-II (supra); b) Regulation of games of skill lies under Entry 26 List II (trade and commerce), not under Entry 34 ("betting and gambling"); c) Recourse to Entry 1 (public order) and Entry 2 (police) is unjustified because an activity that is not res extra commercium cannot intrinsically generate a public order issue merely by being online. 152. The TN Online Gambling Act 2022/23 is also unconstitutional in part because: a) Sections 2(i), 2(j), 2(l) read with Sections 7-10 and 23 and the Schedule presumptively classify rummy and poker as "online games of chance" when played for money, despite consistent judicial recognition of these games as games of skill; b) The law perversely permits physical rummy for money while targeting the same game online, without cogent justification. 153. The Madras High Court's judgment dated 09.11.2023 correctly held that: a) There is a consistent line of decisions of this Court and the High Courts holding rummy and poker to be games of skill. Consequently, a heavy burden lies on the State ....
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....cannot amount to total prohibition. The TN Online Gambling Act 2022/23 by imposing a blanket ban on online games for stakes, fails this test of reasonableness and proportionality. 159. The Karnataka High Court in AIGF (supra) has already held that games involve psychology, behaviour, emotions, and motivations, that they have artistic and recreational value, and that games of skill fall within the protection of Articles 19(1)(a) and 21 (subject to reasonable regulation). The TN Online Gambling Act 2022/23 ignores and contradicts this binding reasoning. 160. For over two centuries, Indian legislative policy has consistently distinguished games of skill from "gambling" and has purposefully excluded games of skill from gambling legislation, as evidenced by nineteenth-century enactments and subsequent statutes that repeatedly preserve this distinction. 161. "Betting and gambling" was incorporated into Entry 36 of List II of the Government of India Act, 1935 and retained as Entry 34 of List II of the Seventh Schedule to the Constitution. The concept under this Entry is premised on the staking of money or property, i.e. wagering or stake, as the central element. 162. Even in g....
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....esence of three elements: (a) prize, (b) chance, and (c) consideration. If any one element is missing, the activity is not gambling or lottery. 169. This three-element definition is the precise legal (nomen juris) conception of "lottery, gift enterprise, or similar scheme" and has been expressly adopted by courts such as the US Supreme Court in FCC v. American Broadcasting Co. reported in 347 U.S. 284 (1954) and the Supreme Court of Alaska in State of Alaska v. Pinball Machines reported in 404 P.2d 923. 170. The phrase "betting and gambling" in Entry 34, List II of the Seventh Schedule to the Constitution (and its predecessors) is not defined in the constitutional text or the Government of India Act, 1935, and therefore must be construed according to its precise legal meaning (nomen juris), and not in a loose, popular sense. 171. By analogy to India's federal structure, in the United States, the primary power to regulate betting, gambling and lotteries lies with the States, as recognized in Murphy v. NCAA reported in 584 U.S. 453 [138 S. Ct. 1461], where a federal restriction on State authorization of sports betting was held to violate the Tenth Amendment. 172. Within t....
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....hanged merely because stakes are involved. Therefore, betting on a game of skill does not convert that game into "gambling". 181. The decision in Rohan v. Detroit Racing Assn. reported in 314 Mich. 326 (1946), similarly holds that wagering on the outcome of inherently skill-based activities does not transform them into games of chance, reinforcing the above contention. It is therefore incorrect to assert that playing a game of skill "for stakes" renders it a game of chance or "gambling"; the legal character of a game of skill is preserved irrespective of the presence of stakes. E. SUMMARY OF THE SUBMISSIONS CANVASSED ON BEHALF OF THE RESPONDENTS 182. The learned counsel appearing for the in this batch of petitions have consistently submitted that treating games of skill as res extra commercium when played for stakes is contrary to the established jurisprudence in RMDC-I (supra), RMDC-II (supra), and K. R. Lakshmanan (supra). They all have also collectively emphasized on the protection under Article 19(1)(g). 183. Another common submission canvassed by Mr. Aryama Sundaram and Mr. Mukul Rohatgi is on the regulation of online gaming and FS to primarily lie within the exclu....
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....y struck down. 191. Submissions with regards to the TN Online Gambling Act 2022/23 dealt with in SLP (C) Nos.1588-1592 of 2024 are that though they were enacted to ostensible prohibit online gambling and regulate online gaming, it in substance proscribes games of skill such as rummy and poker by deeming them games of chance through provisions including Section 2(1), Section 7 and the Schedule. 192. Therefore, both the Madras High Court and the Karnataka High Court have rightly applied long-standing Supreme Court precedents on the distinction between games of skill and games of chance, warranting no interference by this Court in the present matter. E.3. Ld. Senior Counsel Mr. Aryama Sundaram appearing for the All India Gaming Federation in C.A. No. 6124 of 2023, contended the following: 193. A statute's character as regulatory or prohibitory depends on the nature of the act being targeted and whether it is res extra commercium. Games of skill are not res extra commercium. Treating games of skill as res extra commercium when played for stakes is contrary to RMDC II (supra) and K.R. Lakshmanan (supra) and impermissibly removes them from Article 19(1)(g) protection. 194.....
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....such platforms. State-wise prohibitions would only yield regulatory chaos. E.5. Ld. Senior Counsel Mr. Neeraj Kishan Kaul contended the following while appearing for respondent No. 2 (Galactus) in C.A. Nos. 6132-6143 of 2023: 200. The challenge is directed to the 2021 Karnataka Amendment Act, which, read with its Statement of Objects and Reasons, is said to impose a complete embargo on organising and playing online games with stakes, covering skill as well as chance. 201. It is contended that Entry 34 is a single composite expression. Therefore, "betting" is not a distinct, free-standing subject but is conjunctively linked with "gambling", and the use of "and" (instead of "or") shows legislative intent to regulate betting only when it is integrally connected with gambling activities. Since the impugned amendments extend their operation to games of skill (including online skill-based formats with monetary stakes), they travel beyond "betting and gambling" in Entry 34 and therefore lie outside State legislative competence under Article 246(3). 202. The amendment is violative of Article 14 for drawing no constitutionally valid distinction between games of chance (gambling ....
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.....R. Lakshmanan (supra). Further, competitions involving substantial skill are business activities protected under Article 19(1)(g). E.7. Ld. Senior Counsel Mr. Abhishek Malhotra appearing on behalf of respondent No. 17 (Paavan Nanda) in C.A. Nos. 6132-6143 of 2023 207. It is submitted that Karnataka's blanket ban on games played for stakes, including skill games, violates Articles 19(1)(g) and 19(1)(a), as online games constitute expressive content. Jurisprudence under Article 19(1)(a) protects not only speech and expression but also the medium through which expression is conveyed. Reliance placed on decisions such as in Indian Express (supra) and Tata Press Ltd. (supra), which recognise that freedom of the press and commercial speech are integral aspects of Article 19(1)(a), and that the right covers both dissemination and receipt of content, which applies equally to online games as a medium of content. 208. Restrictions on speech are constitutionally permissible only if they fall within the specific grounds in Article 19(2) and qualify as "reasonable" in a qualitative, quantitative, and contextual sense. They must be proportionate and cannot amount to total prohibition. ....
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....mean that the competence of the State Legislature extends only to betting on gambling activities? In other words, whether betting on games of pure skill falls outside the purview of the legislative competence of the State Legislature under the said entry? (ii) Whether the two impugned state legislations failed to correctly infer and apply the decisions of this Court in RMDC-I (supra), RMDC-II (supra) and K.R. Lakshmanan (supra), respectively? (iii) Whether the two impugned state legislations are manifestly arbitrary insofar as they treat both the games of skill and games of chance in the same manner? (iv) Whether the two impugned state legislations, by imposing a blanket prohibition on online games with stakes, failed to adopt the least intrusive measure for regulation of the online gaming activities and entities, and as such could be said to be constitutionally invalid for being disproportionate? (v) Whether the decision of the State Legislatures to regulate and prohibit online gaming with stakes by way of the impugned legislations is supported by any empirical finding or research? (vi) Whether the expression "gaming" could be said to h....
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....ce that pervasively animates it. This interpretation of the said Entry gains support from the six decade old CHAMARBAUGWALA jurisprudence." II. Findings in Junglee Games "118. It is in such light that "Betting and gambling" in Entry 34 of the State List has to be seen, where betting cannot be divorced from gambling and treated as an additional field for the State to legislate on, apart from the betting involved in gambling. Since gambling is judicially defined, the betting that the State can legislate on has to be the betting pertaining to gambling; ergo, betting only on games of chance. At any rate, even otherwise, the judgments in the two Chamarbaugwala cases and in K.R. Lakshmanan also instruct that the concept of betting in the Entry cannot cover games of skill. Although the State could contend with some degree of justification that its legislative competence extends beyond Entry 34 by drawing on, for instance, Entries 1, 26 or 33, in such event, the State should have discharged the burden of establishing proportionality. For reasons detailed in preceding paragraphs, by imposing a wide-ranging blanket ban, the State has completely failed to meet the "least int....
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.... Entry 44 to include "entertainments and amusements" as part of the entry. b) Shri H.V. Kamath raised an objection to such inclusion on the ground that the Government was trying to arrogate to itself far more powers to interfere with the lives of citizens and referred to a Report in the Bombay papers that the Government was trying to ban a harmless game like rummy. The relevant extract is as follows: "I feel, Sir, that by including 'entertainments and amusements' in this entry-they were not there in the original draft-the Government are trying to arrogate to themselves far more powers to interfere with the lives of citizens than are necessary. The other day there was a report in the Bombay papers that that Government was trying to ban even a harmless game like rummy. I think that entertainments of this kind at least must be kept beyond the purview of Government." c) In response to the objection, Shri T.T. Krishnamachari stated that this aspect of the matter comes in as Entry 45 in the List, for which Shri H.V. Kamath elaborated on the nature of the objection. d) While addressing the action of the Bombay Government mentioned by Shri H.V. K....
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....ition is only strengthened. 221. The following comes to light after an examination of the Constituent Assembly Debates on Entry 45 List II, as it then stood, on 02.09.1949: a) Shri Shiban Lal Saksena moved a motion to delete the entry "betting and gambling" on the ground that it would be legalized by the entry and substantiated by stating that it goes against the principles to which the Constituent Assembly is committed. b) Shri Lakshminarayan Sahu supported the deletion and even stated that the entry encourages betting and gambling and taxation on such items does not appear to be proper. c) To the above objections, the following was stated by Dr. B.R. Ambedkar immediately after which the idea of deleting the entry was dropped and the Entry was adopted as part of our Constitution: "Sir, I am very much afraid that both my friends, Mr. Shibban Lal and Mr. Sahu, have entirely misunderstood the purport of this entry 45 and they are further under a great misapprehension that if this entry was omitted, there would be no betting or gambling in the country at all. I should like to submit to them that if this entry was omitted, there would be absolutel....
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....appening, which prompted him to push for the Entry to be included as part of the 7th Schedule. Despite the existence of such an entry, the State of Karnataka and Tamil Nadu continue to be powerless to regulate betting and gambling on games of skill in cyberspace in lieu of the judgments in AIGF (supra) and Junglee Games (supra). 224. The speech of Dr. Ambedkar in the Assembly clearly indicates that the intent behind the inclusion of the entry was to leave it to the wisdom of the State Legislatures the question and manner of regulation of betting and gambling activities. Thus, even if a State had followed a different approach towards regulation of betting and gambling for years, it would be open for it to change the approach to increase the regulation, or even prohibit certain betting and gambling enterprises, if a need to do so is felt. III. Entries in the Seventh Schedule must receive broad and liberal interpretation 225. The Entries under Schedule 7 of the Constitution of India have been drafted to be as broad, expansive and wide as possible. A few of these entries are reproduced below for the purpose of illustration. List I Entry 15-War and peace ....
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....in the legislative lists is to provide a wide meaning to them. A narrow interpretation must only be adopted when either (a) the scope of the Entry is limited by the use of language devices; or (b) a wide interpretation creates an overlap between entries within the same list or different lists. For example, Entry 25 of List II provides States the competence over "gas and gas-works". This Court in Calcutta Gas Company (supra) did not interpret the Entry to only include the product of 'gas and gas works' but rather interpreted it to include the industry. This is the construction which is in consonance with settled principles of interpretation. xxx xxx xxx 85. The judgment of this Court in Gannon Dunkerley (supra) must be read in the context of the settled principle of interpreting legislative entries, that the entries must be conferred the widest meaning possible. Interpreting a phrase or words in the Legislative Lists based on the legal import of the phrase is, thus, in many ways an exception to the settled principle of interpreting entries. This is for the simple reason that the legislative entries delimit the scope of competence of the legislativ....
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....atute and they made express provision for it under Entry 48." For these reasons, the principle of interpretation elucidated in Gannon Dunkerley (supra) must be used cautiously by Courts." (Emphasis Supplied) 228. In Welfare Association v. Ranjit P. Gohil, reported in (2003) 9 SCC 358 this Court held as follows: "28. The fountain source of legislative power exercised by Parliament or the State Legislatures is not Schedule 7; the fountain source is Article 246 and other provisions of the Constitution. The function of the three lists in the Seventh Schedule is merely to demarcate legislative fields between Parliament and States and not to confer any legislative power. The several entries mentioned in the three lists are fields of legislation. The Constitution-makers purposely used general and comprehensive words having a wide import without trying to particularize. Such construction should be placed on the entries in the lists as makes them effective; any construction which will result in any of the entries being rendered futile or otiose must be avoided. That interpretation has invariably been countenanced by the constitutional jurists, which gives the w....
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.... the writ petitioners' rights under Article 19(1)(g) of the Constitution did not arise. In the discussion on the validity of the Amending Act of 1952 that was before the Supreme Court, such court noticed that "Betting and gambling" as appearing in List-II in the Seventh Schedule to the Constitution was there in the Government of India Act, 1935. In the context of the definition of "prize competition" that included any competition in which the success did not depend to a substantial degree upon the exercise of skill, the Supreme Court referred to an English judgment that opined that even if a scintilla of skill was required for success the competition could not be regarded as of a gambling nature, but toned down the dictum and acknowledged that a game of substantial skill would not amount to gambling. The Supreme Court agreed with the proposition that "a competition in order to avoid the stigma of gambling must depend to a substantial degree upon the exercise of skill." At paragraph 17 of the report, the court went on to say that a competition in which success does not depend to a substantial degree upon the exercise of skill "is now recognised to be of a gambling nature." ....
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....s to the present Act, it will not be questioned that competitions in which success depends to a substantial extent on skill and competitions in which it does not so depend, form two distinct and separate categories. The difference between the two classes of competitions is as clear-cut as that between commercial and wagering contracts. On the facts, there might be difficulty in deciding whether a given competition falls within one category or not; but when its true character is determined, it must fall either under the one or the other. The distinction between the two classes of competitions has long been recognised in the legislative practice of both the United Kingdom and this country and the courts have, time and again, pointed out the characteristic features which differentiate them. And if we are now to ask ourselves the question, would Parliament have enacted the law in question if it had known that it would fail as regards competitions involving skill, there can be no doubt, having regard to the history of the legislation, as to what our answer would be. Nor does the restriction of the impugned provisions to competitions of a gambling character affect either the texture or t....
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....ative judicial pronouncements brought to bear on the subject by the parties need to be understood and applied. For a start, K.R. Lakshmanan instructs that when a game of skill is distinct from a game of chance, on the preponderance of the skill element involved, the activity would be protected by Article 19(1)(g) of the Constitution and competitions involving games of skill have to be regarded as business activities. xxx xxx xxx 127. At the same time, the Amending Act and the law laid down on the subject in a plethora of judgments are so inconsistent and irreconcilable that both cannot stand together. Even the Law Commission's recommendations stressed on regulation and not prohibition. In the chit fund case of Narayana Aiyangar that the State has relied on, the emphasis is on the need for regulation in the interests of the public. There is no doubt that M.J. Sivani read the word "gaming" in a wider sense when it observed that "a game of pure chance or mixed chance and skill, it is gaming"; but such dictum of a two-Judge Bench rendered in 1995 must be seen to have been tempered by the clear enunciation of the law in such regard in the later judgment of K.R. Lak....
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....oportionality. For reasons detailed in preceding paragraphs, by imposing a wide-ranging blanket ban, the State has completely failed to meet the "least intrusive" measure test and, therefore, the impugned amendment falls foul of Article 19(1)(g) of the Constitution." (Emphasis Supplied) 234. A Division Bench of the High Court of Karnataka in AIGF (supra), after having extensively discussed the two RMDC cases, invalidated the impugned Acts on the basis that the wording of Entry 34 must be read conjunctively such that "betting" derives its colour from "gambling", thereby confining the competence of the States to legislate only on activities characterised by chance rather than skill. It also went on to deduce from these decisions that a game that involves a substantial amount of skill cannot be construed as gambling. The relevant observations pertaining to the RMDC decisions are made in the following paragraphs as extracted below: "IX. SCOPE OF ENTRY 34 IN STATE LIST; CHAMARBAUGWALA JURISPRUDENCE; GAMES OF SKILL v. GAMES OF CHANCE: Learned advocates appearing for the petitioners submitted that the term 'Betting and gambling' employed in Entry 34, List II ....
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....petition success in which does not depend to a substantial degree 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 scintilla of skill was required for success the competition could not be regarded as of a gambling nature. The Court of Appeal in the judgment under appeal has shown how opinions have changed since the earlier decisions were given and it is not necessary for us to discuss the matter again. It will suffice to say that we agree with the Court of Appeal that a competition in order to avoid the stigma of gambling must depend to a substantial degree upon the exercise of skill. Therefore, a competition success wherein does not depend to a substantial degree upon the exercise of skill is now recognized to be of a gambling nature." What emerges from the above observations is that : gambling is something that does not depend to a substantial degree upon the exercise of skill, and therefore something which does depend, ought not to be considered as gambling; as a logical conclusion, a game that in....
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.... gain by lot or chance, which lead to the loss of the hard earned money of the undiscerning and improvident common man and thereby lower his standard of living and drive him into a chronic state of indebtedness and eventually disrupt the peace and happiness of his humble home could possibly have been intended by our Constitution makers to be raised to the status of trade, commerce or intercourse and to be made the subject matter of a fundamental right guaranteed by the Article 19(1)(g)." It also reproduced the observation of the US Supreme Court in UNITED STATES v. KAHRIGER and LEWIS v. UNITED STATES: "...there is no constitutional right to gambling..." In view of the settled position of law, it hardly needs to be stated that gambling, i.e., the 'games of chance' do not enjoy any Constitutional protection since they are mala in se. It is open to the legislature to absolutely prohibit them as is done to the trades in noxious or dangerous goods or trafficking in women. However, games of skill by their very nature stand on a different footing. xxx xxx xxx (j) The Apex Court in INDIAN EXPRESS supra extended protection to the Press with the following reasoning....
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....ce & technology. New implications and difficulties are cropping up in the society justifying innovative ventures on the part of the State to effectively manage them. A greater leverage needs to be conceded to the State in devising appropriate measures for curbing the menace of online gaming. He passionately submitted that what was true of things that happened in the bygone decades i.e., when CHAMARBAUGWALAS were decided, need to be examined afresh. In support of this, he cites the decision in SIVANI supra contending that the absolute embargo on videogames has been upheld by the Apex Court, despite CHAMARBAUGWALAS. He also refers to a Public Interest Litigation in W.P. No. 13714/2020 between SHARADA D.R. v. STATE OF KARNATAKA in which a direction was sought for banning of all forms of online gambling and betting disposed off on 26.10.2021 by this Court, and that the Amendment Act has been enacted keeping in view the same. (b) We do appreciate the above submissions of the learned Advocate General. However, that does not much come to the rescue of respondents. True it is: Constitution is intended to enure for ages to come and consequently, to be adapted to the various crises ....
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.... to the Madras City Police Act, 1888 and the Madras Gaming Act, 1940 whereby the exception carved out for wagering on horse-racing from the definition of "gaming" was deleted, much like the effect of the Amendment Act herein which inter alia widens the definition of "gaming" to include "wagering on games of skill", that hitherto enjoyed constitutional protection. Having considered CHAMARBAUGWALAS-I & II, K. SATYANARAYANA and some notable decisions of foreign jurisdictions, the Court succinctly stated the difference between a game of chance and a game of skill, as under: "3. The new Encyclopedia Britannica defines gambling as "The betting or staking of something of value, with consciousness of risk and hope of gain on the outcome of a game, a contest, or an uncertain event the result of which may be determined by chance or accident or have an unexpected result by reason of the better's miscalculations". According to Black's Law Dictionary (Sixth Edition) "gambling involves, not only chance, but a hope of gaining something beyond the amount played. Gambling consists of consideration, an element of chance and a reward... Gambling in a nut-shell is payment of a price f....
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....on the basis of a wider interpretation of the definition of 'gaming' in the context of a legislation which was enacted to regulate the running of video parlours and not banning of video games; true it is that the Apex Court treated certain video games as falling within the class of 'games of chance' and not of 'games of skill'. However, such a conclusion was arrived at because of manipulation potential of machines that was demonstrated by the reports of a committee of senior police officers; this report specifically stated about the tampering of video game machines for eliminating the chance of winning. This decision cannot be construed repugnant to Chamarbaugwala jurisprudence as explained in K.R. LAKSHMANAN. We are of a considered view that the games of skill do not metamorphise into games of chance merely because they are played online, ceteris paribus. Thus, SIVANI is not the best vehicle for drawing a distinction between actual games and virtual games. What heavily weighed with the Court in the said decision was the adverse police report. It is pertinent to recall Lord Halsbury's observation in QUINN v. LEATHAM: that a case is only authority for what it actually decides in....
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....s of chance. By contrast, games where success depends to a substantial degree on skill constitute lawful business protected by Article 19(1)(g). In light of the same, the statutes or blanket prohibitions that oversee this skill-chance divide are overbroad, disproportionate, and ultra vires to the extent they purport to regulate or proscribe skill-based activities. 240. The question that, therefore, arises for our consideration is whether the interpretation of "betting and gambling" in Entry 34 of List II, as adopted by the respective High Courts by placing reliance on the judgments in RMDC-I (supra), RMDC-II (supra) and K. R. Lakshmanan (supra), can be construed as 'betting on gambling'. In other words, can the State's legislative competence under Entry 34 List II be confined exclusively to betting on games of chance alone, thereby rendering any prohibition or regulation of skill-based games played with stakes unconstitutional. 241. To address the contentions as canvassed, we must first try to decipher what has been held in the aforesaid three decisions, and more importantly, the context in which the same has been held. What appears from a reading of the decision of this Cour....
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....which is not yet ascertained or not yet generally known. It is said that forecasts of such events as are specified in the section need not necessarily depend on chance, for it may be accurately done by the exercise of knowledge and skill derived from a close study of the statistics of similar events of the past. It may be that expert statisticians may form some idea of the result of an uncertain future event but it is difficult to treat the invitation to the general public to participate in these competitions as an invitation to a game of skill. The ordinary common people who usually join in these competitions can hardly be credited with such abundance of statistical skill as will enable them, by the application of their skill, to attain success. For most, if not all, of them the forecast is nothing better than a shot at a hidden target. Apart from the unlikelihood that the Legislature in enacting a statute tarring both lotteries and prize competitions with the same brush as indicated by Section 3 would squeeze in innocent prize competitions in between two categories of purely gambling varieties of them, all the considerations and difficulties we have adverted to in connection with....
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....has innumerable variables that decide the outcome of a given match, can be foreseen by a common person, would be nothing but closing our eyes to the practical reality that in the garb of making fantasy or dream teams, the players are merely taking a shot at a hidden target, merely in a more sophisticated manner, than a slot machine or roulette. 247. We are not unmindful of the fact that when even the best AI powered prediction models cannot predict with precision the outcome of a cricket match, it would be too much to believe that a common person may calculate, based on statistical knowledge, the best combination of players who would be the best 11 players to perform on a given day in a given match. 248. It is further important to mention that there is no discussion in the said decision as to what are the attributes of the expression "betting" and also whether the legislative competence of the State Legislature under Entry 34 is limited to betting on gambling activities. 249. Further, as regards the decision in RMDC-II (supra), the key expression in contention was "competitions which involve substantial skill" and whether they would fall within the regulatory purview of En....
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....a and Madras respectively faced at the time of enacting the impugned legislation is starkly different from the situation that formed the backdrop in the two RMDC cases. The statement of objects of the impugned Acts indicates the widespread problems being caused by the prevalence of online gaming platforms allowing betting and gambling with real money at stake. In such circumstances, the decision in RMDC-II (supra) cannot be an impediment, as the decision dealt with a factual scenario entirely different from the current one, and also because the decision does not explain or curtail the scope of the word "betting" appearing in Entry 34 List II. 254. It needs to be pointed out that the nature of legislation under challenge before us is of a different nature. The legislations impugned in the two RMDC cases never intended to regulate betting on games of substantial skill. All that was sought to be regulated there were situations wherein a participant himself indulged in a game, success in which was not substantially dependent on skill, and it was such regulation which was challenged on the ground that the phrasing of the legislation left scope for regulation of games of skill too, wh....
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.... the State Legislature had itself carved out for games of "mere skill". 259. What follows from a reading of the decision as aforesaid is that where the State Legislature, in its wisdom, has deemed it appropriate to regulate games where monetary stakes are involved, without affording any special protection to games of mere skill, the decision in K.R. Lakshmanan (supra) will not be of much avail. In the absence of Sections 11 and 49 of the 1930 Gaming Act and 1963 Police Act, respectively, would the decision in K.R. Lakshmanan (supra) still be the same? We find the answer to be a 'No'. 260. We also take note of the observation made by the Australian High Court in King v. Connara reported in 61 CLR 596, to the effect that whether an activity belongs to the category of commerce or to the category of gaming/gambling, is a matter of social opinion and not jurisprudence. The Constitution makers, by enacting a broad entry 34 have left ample scope for the State Legislatures to keep an eye on the efflux in social opinion as regards these activities and codify the regulations necessary to deal with a changing social order. As we have already discussed, with the disruption caused by the ....
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....imed at regulating/taxing "prize competitions" wherein the success of the participant did not substantially depend on the skill of the participant. Similarly, in K.R. Lakshmanan (supra), this Court was called upon to adjudicate whether betting on horse-racing could be prohibited by the legislation impugned therein, which had a specific provision conferring immunity to games of mere skill. 264. However, the situation in the present case is of a different nature. The question is not that whether games of substantial skill simpliciter can be prohibited by virtue of Entry 34 List II. This much is settled that such games would not amount to gambling and hence enjoy the protection of Article 19(1)(g) of the Constitution. The question is that when a player or third person places a bet on the uncertain outcome of a game of skill, with the hope of earning an amount more than he has staked, would such an act, which indubitably amounts to betting, not be covered by the expression "betting and gambling" used in Entry 34 and thus be amenable to regulation by the State Legislature. In view of the discussion as aforesaid, which indicates that even the much relied upon decisions in the two RMDC....
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....or all from the purview of Entry 34 List II. 269. Once it goes out of the Constitutional scheme and therefore would remain unregulated is something which not only goes against the teeth of various judgments but the underlying Constitutional principle that betting on uncertain events irrespective of the underlying game being a game of skill or chance, would fall within the rigors of Entry 34 List II. 270. When the uncertainty remains the same and the constant factor in both these groups of games also remains the same, an interpretation taking one out of the regulation and retaining the other especially when the State Governments of Karnataka and Tamil Nadu tracing their power to Entry 34 List II had removed the protection to stakes played on games of skill, is an erroneous reading of Entry 34 of List II. 271. According to the High Courts, the act of staking would constitute "betting" and only when such betting takes place in relation to a gamble, i.e., taking a chance or in a chance-based game, would the States be entitled to exercise their legislative powers under Entry 34 List II. For the reasoning of the High Court to be logically correct, it must be correct to say that ....
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....pon paying an entry fee would not constitute gambling. Nothing more can be read into RMDC-I (supra). 276. Therefore, to even remotely suggest that RMDC-I (supra) re-casted Entry 34 List II from "betting and gambling" to "betting on gambling" is incorrect, and such a finding emanates from a misreading of RMDC-I (supra). 277. The sheet anchor of the online gaming companies' submission is a far-fetched interpretation by interlocking a couple of sentences in the judgments of this Court in RMDC-I (supra), RMDC-II (supra), K.R. Lakshmanan (supra) and Satyanarayana (supra), respectively, without examining the underlying context. 278. The Online gaming companies have placed strong reliance on the following findings rendered by the Constitution Bench judgement in RMDC-I (supra): "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 scintilla of skill was required for success the competition could not be regarded as of a gambling nature. The Court of Appeal in the judgment under appeal has shown how opinions have changed since the earlier decisions were given and it is not nece....
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....on that therefore arises is what were the "stakes" in the facts of RMDC-I (supra). The answer lies in the underlying High Court judgment in RMDC-I (supra), placed on record by learned Senior counsel Mr. Gopal Sankaranarayanan. f) In the first paragraph, the following was recorded as facts of the case: "The registered office of the petitioners is situated in Bangalore. They own and run a weekly newspaper called the Sporting Star. This paper is printed and published in Bangalore and it contains a crossword prize competition called the R.M.D.C. Crosswords for which entries are received from various parts of India including the State of Bombay. The petitioners have agents and depots in various places in the territory of India including the State of Bombay to collect entry forms and fees for being forwarded to the petitioners at Bangalore. The petitioners advertise their crossword prize competition in various publications in various places in India including the State of Bombay." (Emphasis Supplied) g) Therefore, every participant of the prize competition, which was subject matter in RMDC-I (supra), had paid an "entry fee" to participate in the Compet....
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....e" is a misnomer in a game of chance. m) Here again, the online gaming companies contend that since rummy is a game of skill, the stakes placed by each participant must be treated akin to an entry fee for a skill-based competition. It was also argued that since the Revenue concedes that an entry fee for a skill-based competition is not gambling, the show-cause notices in the present batch of maters requires to be quashed. n) This argument requires to be rejected outright because the online gaming companies in the facts and circumstances of the case have not called for participants to participate in any tournament conducted by them where there are winners announced and declared by the companies at the end of the competition. To the contrary, the terms and conditions is a clear invitation to place stakes on the uncertain and unknown outcome of each game and where each game has a winner, unlike a tournament. The companies cannot be permitted to state that there can be hundreds of tables (or virtual rooms) with varying amounts of pool money and each table is a tournament by itself. Such a contention would be too far-fetched and defies logic and what is commonly unders....
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....the stake element would amount to betting and gambling, providing the basis for the States to interfere. RMDC-I's ratio merely seeks to achieve this purpose. 281. If for any reason, in a given set of facts and circumstances, it is found that the entry fee partakes the character of a stake or nothing but the stake based on the outcome of such a game or competition involving skill, then it would become betting and gambling. On the other hand, if it retains its character only as an entry fee and the organizers reward the winner with the trophy or a cash prize or prize money which is announced in advance, then it is in the nature of a reward for one who has succeeded in the competition and would not take the colour and character of a bet amount. This distinction is not academic or superficial and happens in reality. 282. Lastly, on a perusal of the judgment in RMDC-I (supra), the stand of the State is in fact, supported. This Court took recourse and examined the aspects of gambling from the ancient history perspective, the mythological perspective and the perspectives offered by various religions. After quoting extensively from the Rig Veda, the Mahabharata, Yajnavalkya, and Vrih....
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....victory in a game of rummy, which event is unknown, uncertain and not known at the time of placing the stake. When this Court has held such forecasting to be gambling, the State contends that the players are equally gambling because the act of staking on the unknown and uncertain victory in the game is no less forecasting. 286. The online gaming companies contend that the interpretation of the State would overturn 70 years of jurisprudence, as all courts in India have understood RMDC-I (supra) in such a way that it protects games of skill to be played with stakes, and the same would not amount to gambling. With the greatest of respect, the above alleged ratio does not flow on an explicit reading of RMDC-I (supra). When what does not flow from RMDC-I (supra) has been canvassed for 70 years as if emanating from RMDC-I (supra), the same is erroneous and requires a course correction. There are multiple judgments rendered by various High Courts which hold that games of skill played with stakes amounts to gambling, and all these judgments have also considered RMDC-I (supra). It is therefore incorrect to say that the views of the gaming companies have alone been upheld or adopted throu....
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....e race being run definitely constitute a small group of persons who may be attributed with above-average expertise in the factors affecting the outcome of a horse race. The situation in K.R. Lakshmanan (supra) was entirely different from the situation before us, where there is no enclosure in the virtual world, and where the average participant cannot be credited with the expertise of a punter inside a racing club. Furthermore, the express declaration of betting from outside the club premises as illegal by the decision in the said case further reinforces that the decision was passed in the specific context of horse-racing, which is very different in scale, accessibility and outreach than online gaming activities. 290. Therefore, it is abundantly clear that there is no legal shelter for the online gaming companies to claim that placing stakes on games of skill would not amount to betting and gambling. The Authorities relied on by the Union and the States uniformly hold the contrary. VI. The impugned legislations do not suffer from manifest arbitrariness 291. The concept of equality, as envisaged under Article 14, contains an interdiction against arbitrariness and discrim....
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....fic meaning in common parlance. The following are the ingredients of betting and gambling: a) There must be a stake/bet. b) The bet that is placed must be on the result of an uncertain outcome. c) The stakes must be placed with a hope of gaining substantially more than what is being staked, depending upon the result of the uncertain event. 294. There is no question of manifest arbitrariness as betting and gambling are independent activities in themselves and it is not concerned with the nature of the game being played. The artificial construction that is sought to be created by the online gaming companies will denude the State of all the powers to regulate and prohibit betting and gambling for times to come. If such a contention is allowed to be sustained, it will cause grave injustice to the saintly ideals of the Fathers of our Constitution. 295. If one examines the judgments rendered across several jurisdictions, an inescapable conclusion that one would arrive at is that the underlying classification of a game as either skill or chance is immaterial and once any game is played with stakes, it would amount to betting and gambling. 296. The Queen....
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....ng played at the time when the Petitioners were arrested was gaming under the Act. 300. The High Court laid down a three-pronged test to determine whether the offence of gaming was made out or not. They are as follows: a) First, it should be determined whether the game is covered by the definition of gaming meaning thereby, to determine whether a game was being played with stakes. b) Secondly, if the game is a game of chance, it is hit by the Act. c) Thirdly, if the game is a game of skill, it will not be hit by the Act since Section 10 protects gaming on games of skill. 301. As to when something would constitute gaming, the High Court, after referring to the Imperial Dictionary, Murray's Dictionary, Hari Singh v. Jadu Nandan reported in (1914) 23 I.C., 484, Ram Pratap Nemani v. Emperor reported in 1912 SCC OnLine Cal 161 and King Emperor v. Musa reported in AIR 1917 Mad 124 respectively, held that it is the existence of a stake and not the character of the game as one of skill or chance, that is regarded as constituting the distinction between playing a game and gaming. Entirely adopting the view of Justice Sadashiva Iyer in King Emperor v. Musa (s....
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....d gambling. b) Wherever the expression gaming is defined in the statute, one has to go by the definition attributed to that expression. Almost in all instances it would still indicate it being akin to betting and gambling. c) The character of the underlying game is immaterial in determining whether there exists betting and gambling. What is essential is the element of stake. Introducing stakes in any game amounts to betting and gambling. d) The underlying character of the game gains relevance only when the statutes protect games of skill played with stakes from constituting an offence. Such a protection is immaterial to determine whether there exist gaming or betting and gambling. This is because protection is required only when it is betting and gambling in the first place. e) Wherever players enjoy the protection, it merely indicates that it would not constitute an offence. The protection cannot be read to mean that staking on a game of skill would not amount to gambling at all. 305. A perusal of the judgments rendered pre-Constitution as well as post-Constitution clearly indicates that as far as betting and gambling are concerned, a differe....
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....nce as it lays down the correct position of law. The High Court of Madras held as follows: "21. Playing of cards perhaps may be for relaxing oneself or for an entertainment provided such play has limitations. Playing of cards with stakes has two evils i.e., it corrupts the mind of the players to become addict and it makes most of the players bankrupt. Discussions above undoubtedly point against the practice of indulging in gambling, be it rummy or other similar games, where wagering or betting is involved. We may also refer to the ordinary use of the expression "winning". The word "winning" has been given the following meaning in the Universal Dictionary of English Language, namely, "Amount won, esp. money won in betting." In the Oxford English Dictionary, the word "winning" is given the following meaning, namely, "Things or sums gained, gains, profits, earnings in mod. use chiefly applied to money won by gaming or betting." In Webster's Third International Dictionary, the word "winning" is given the following meaning, namely, "Something one wins esp. the money won by success in competition." Therefore, in the event a place is used for gambling, it will be termed to be....
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....be "gaming" as per common parlance in MJ Sivani (supra). 310. In MJ Sivani (supra) this Court referred to two definitions of Gaming as given in the Strouds Judicial Dictionary and Black's Law Dictionary reported in 6th edn. at 679, as given below: "(i) The Strouds Judicial Dictionary: To play any game, whether of skill or chance for money or money's worth; and the act is not less gaming because the game played is not in itself unlawful and whether it involved or did not involve skill. (ii) The Black's Law Dictionary Bryan A. Garner & Henry C. Black, Black's Law Dictionary, (6th ed.) 679, 1990 The practice or act of gambling. An agreement between two or more persons to play together at a game of chance for a stake or wager which is to become the property of the winner, and to which all contribute. The elements of gaming are the presence of price or consideration, chance and prize or reward." 311. The Court also noted that Section 2(7) of Mysore Police Act, 1963, defines "gaming" to mean that "it does not include a lottery but all forms of wagering or betting in connection with any game of chance, except wagering or betting on a horse-race, w....
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....nated any chance for display of skill even for little stakes. The High Court could be said to have failed to appreciate that the moment the stakes are involved, irrespective of the quantum and scale of such stakes, the activity would fall under the ambit of betting and gambling. When such is the case, the States are empowered to legislate, regulate or prohibit under Entry 34 List II. 318. Vide Para 110 of the judgment in Junglee Games (supra), the Madras High Court had agreed that gambling and betting has a negative impact on individuals and can also be ruinous to their well-being. After having observed the same, the Court is incorrect in holding that the element of skill is being neglected by the impugned legislation because ultimately, staking on games of skill would also constitute betting and gambling and can cause the same ruin and financial and psychological hardship to individuals indulged in it. 319. Therefore, there is no question of proportionality since gambling ventures are ultimately res extra commercium as held in RMDC-I (supra). 320. The High Court has held that a blanket ban on games of skill played with little stake fails the proportionality test. This is ....
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....izen to conduct business or trade in adulterated intoxicated liquor by retail or wholesale. It is, therefore, obvious that dealing in liquor inherently pernicious or dangerous goods which endangers the community or subversive of morale, is within the, legislative competence under the Act. The State has thereby the power to prohibit trade or business which is injurious to the health and welfare of the public and the elimination and exclusion from the business is inherent in the nature of liquor business. The power of the legislature to evolve the policy and its competence to raise presumptive evidence should be considered from this scenario." 321. The competence of the state to regulate certain activity also enables it to prohibit the same activity. The 2021 TN Amendment Act has not provided a sweeping definition or a "Midas touch". It has merely brought every form of betting and gambling under its sweep, and for that the States are empowered under Entry 34 List II. 322. Moreover, vide para 105, the Madras High Court in its impugned judgment has expressed concern over the fact that a simple game of volleyball or football played for a cash prize will now come under the scope of....
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.... account the parameters of physical space of operation, time of playing, players' relationship with other players, addiction level, amount of money involved, level of economic activity, scale of organisers' profit and role of credit, has observed that online version of any game cannot be compared with the offline version of the game, except in cases of word games or board games not involving any random outcome generator; AND WHEREAS the said report further states that in the case of online version of games including online rummy, the algorithm for the random generators are known to the developers and hence are pseudo random generators; such games can be played with bots (an autonomous program or character designed to interact with systems or users); no mechanism is available for auditing the centralised server architecture of the gaming systems; and artificial intelligence can be used to manipulate the games and lure the players into continued indulgence; AND WHEREAS the said report classifies the online games, into two types, namely, one which have minimal or negligible randomness factor and another having random event or count generators which are pseudo random ....
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....hat audit of the algorithm makes it difficult to detect any hidden algorithm designed to favour the game provider and that overlay of artificial intelligence in the online gaming can make the gaming scenario completely unfair to the game player/customer, with the game service provider / facilitator literally being able to hold all the cards; and that no scientifically validated algorithm for testing of even pseudo randomness is available at present; AND WHEREAS due to the inherent addictiveness by design of the online games and the money being put in by the game players, the complete gaming scenario amounts to an exploitative, addictive service, causing not only health hazards but also social and economic harm of epidemic proportions; AND WHEREAS many research studies on the effects of online gambling and online gaming addiction on youth, have highlighted negative effects such as development of aggressive behaviour, poor eye-sight, reduced concentration, diminished analytical thinking, decreased productivity and hence should be viewed as a potent vice that would affect the long term prospects of the State and its population; AND WHEREAS the ruining of fam....
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....ch could not have been foreseen in 1950. The foresight and wisdom of the Constitution makers lay not in predicting the future, but in knowing the inevitability of change and evolution, and codifying that inevitability in the language used in the Constitution. 327. While the term "gaming" may be defined in a manner so as to bring it within the meaning of the expression "betting and gambling", the constitutional expression "betting and gambling" cannot be forced to conform to some archaic definition of "gaming". The words "gaming" and "gambling" cannot always be equated. Gaming has not been judicially defined to include only games of chance, contrary to what has been held in the judgment in Junglee Games (supra). The phrase "gaming" cannot be said to be nomen juris. The phrase "gaming" is a statutory definition that can be altered according to the will of the Legislature. In no way can it be dependent on the element of chance alone. The definition of "gaming" is fluid and fluctuating across states and different legislations. Therefore, by no stretch of imagination can the term acquire the status of nomen juris. Each gaming statute, with its unique and evolving definition of gaming....
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.... legislations have been enacted prior to the advent of virtual/online gambling in India, except the State of Sikkim, Nagaland and Telangana, which have introduced regulations pertaining to online gaming also. xxx xxx xxx 37. It is to be noted at this juncture that except the decisions in Varun Gumber's case [High Court of Punjab and Haryana]; Gurdeep Singh Sachar's case [Bombay High Court]; and Chandresh Sankhla's case [High Court of Rajasthan] which dealt with the fantasy sport-Dream11, none of the precedents referred supra deal with online gaming. The decisions discussed supra are in respect of recreational clubs and not specifically refer about any virtual area, like, Internet. Neither the Public Gaming Act, 1867, nor the Tamil Nadu Gaming Act, 1930, specifically speaks about such virtual area, as the advent of such online games are very recent. In fact, the Hon'ble Supreme Court, while dealing with an appeal, has held that the issue pertaining to online rummy has not arisen at all, till date. 38. India has a rich heritage with a diverse range of sports/games. Sports is not only an important source of entertainment, but also imparts value o....
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....-to the online gaming site, while awarding Rs. 20/- to the Winner and Rs. 17/- to the Runner. Naturally, a player, if he looses [sic] his amount, will try to meet out his loss by playing again and again. 44. To be noted, if these set of unemployed youth, who are also under frustration, if get trapped into these elements, may go to any level to meet their loss. The most dangerous thing for any Society is educated criminals. If a knowledgeable person turns out to be a criminal, it would be a havoc on the society. Nowadays, we are also witnessing Graduates involving in chain snatches and other dacoity cases. 45. Keeping these aspects in mind and to regulate and monitor such virtual games, some of the States have amended their prevailing Gaming Acts. 46. The Sikkim Online Gaming (Regulation) Act, 2008, mandates that license has to be obtained for conducting such online games, within the State's boundaries. 47. The Nagaland Prohibition of Gambling and Promotion and Regulation of Online Games of Skill Act, 2016, has excluded the staking of money on games of skill from the ambit of gambling. The Act also defines what are the games of skill and also ....
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....t is exercising power under Section 482 Cr.P.C., with the above suggestions, this Court refrains from observing any further, leaving it to the Government." (Emphasis Supplied) 331. The states are always at liberty to define a particular word or expression for the purpose of achieving the object of the enactment. The scope of judicial review of a challenge to a definition or classification is limited. As we have already held that when the Parliament or the Legislature has, in its wisdom, either defined or classified a particular expression, it is not for the courts to give a different interpretation to deviate from the object the enactment seeks to achieve by altering the natural meaning attached to the expressions in the enactment. A reference may be had to the judgment of this Court in Polestar Electronic (Pvt.) Ltd. v. Additional Commissioner, Sales Tax reported in (1978) 1 SCC 636, this Court has held as under: "7. Now, if there is one principle of interpretation more well-settled than any other, it is that a statutory enactment must ordinarily be construed according to the plain natural meaning of its language and that no words should be added, altered or modifie....
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....Pannerselvam [(1972) 3 SCC 717 : AIR 1972 SC 2284 : (1973) 1 SCR 172] where the Court pointed out that: "'..... addition to, or modification of words used in statutory provision is generally not permissible ...', but 'courts may depart from this rule to avoid a patent absurdity'." Here, the word used in Section 5(2)(a)(ii) and the second proviso is "re-sale" simpliciter without any geographical limitation and according to its plain natural meaning it would mean re-sale anywhere and not necessarily inside Delhi. Even where the purchasing dealer resells the goods outside Delhi, he would satisfy the requirement of the statutory provision according to its plain grammatical meaning. There are no words such as "inside the Union Territory of Delhi" qualifying "re-sale" so as to limit it to re-sale within the territory of Delhi. The argument urged on behalf of the Revenue requires us to read such limitative words in Section 5(2)(a)(ii) and the second proviso. The question is whether there is any necessity or justification for doing so? If "re-sale" is construed as not confined to the territory of Delhi, but it may take place anywhere, does Section 5(2)(a)(ii) or the second prov....
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....aka Amendment Act, respectively. This, we feel, is in addition to the duties of the State enshrined in the directive principles, about which we have discussed above. 333. Entry 1 in the State List reads as follows: Public order (but not including the use of any naval, military or air force or any other armed force of the Union or of any other force subject to the control of the Union or of any contingent or unit thereof in aid of the civil power) a. Contours of the Expression "Public Order" 334. This Court has interpreted the expression "public order" in Entry 1 of the State List at multiple instances and has consistently held that it is an expression that has a very wide connotation. Notions of what constitutes this wider concept of public order have been expounded in various judgments. The categories below distil the judicially-developed ingredients. b. Detriment to tranquility, health, and comfort 335. One of the earliest cases to interpret the expression 'public order' and give the phrase a wide connotation is the decision of this Court in Romesh Thappar v. State of Madras reported in AIR 1950 SC 124: 1950 SC 436. It laid down the meaning of "public o....
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....ably that the security of the State was the aim in view. Our attention has not been drawn to any definition of the expression "public safety", nor does it appear that the words have acquired any technical signification as words of art." (Emphasis Supplied) 336. An application of this understanding can be found in State of Rajasthan v. Shri. G Chawla & Dr. Pohumal, reported in AIR 1959 SC 544 wherein the State of Ajmer (later State of Rajasthan) enacted the Ajmer (Sound Amplifiers Control) Act, 1952. The Act imposed restrictions on the tuning and placement of amplifiers. For example, it mandated that an amplifier cannot be so tuned to be audible beyond 30 yards and cannot be placed at a height of more than six feet from the ground. The legislative competence of the State was challenged on the ground that amplifiers are instruments of broadcasting and communication, and their control would fall within the exclusive domain of the Parliament under Entry 31 of List I. 337. Rejecting this contention, this Court held that the manufacture or the licensing of amplifiers or the control of their ownership or possession, including the regulating of the trade in such apparatus, i....
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....tance are laws upon the subject-matter. It is not enough that a law should refer to the subject-matter or apply to the subject-matter : for example, income tax laws apply to clergymen and to hotel-keepers as members of the public; but no one would describe an income tax law as being, for that reason, a law with respect to clergymen or hotel-keepers. Building regulations apply to buildings erected for or by banks; but such regulations could not properly be described as laws with respect to banks or banking." 14. On a view of the Act as a whole, we think that the substance of the legislation is within the powers conferred by entry No. 6 and conceivably entry No. 1 of the State List, and it does not purport to encroach upon the field of entry No. 31, though it incidentally touches upon a matter provided there. The end and purpose of the legislation furnishes the key to connect it with the State List. Our attention was not drawn to any enactment under entry No. 31 of the Union list by which the ownership and possession of amplifiers was burdened with any such regulation or control, and there being thus no question of repugnancy or of an occupied field, we have no hesitation in....
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.... of public order or that a law creating an offence relating to religion cannot under any circumstances be said to have been enacted in the interests of public order." It has been Held that these two articles in terms contemplate that restrictions may be imposed on the rights guaranteed by them in the interests of public order. Reference may as well be made to the decision in Arun Ghoshe v. State of West Bengal [(1970) 1 SCC 98 : 1970 SCC (Cri) 67] where it has been Held that if a thing disturbs the current of the life of the community, and does not merely affect an individual, it would amount to disturbance of the public order. Thus if an attempt is made to raise communal passions, e.g. on the ground that some one has been "forcibly" converted to another religion, it would, in all probability, give rise to an apprehension of a breach of the public order, affecting the community at large. The impugned Acts therefore fall within the purview of Entry 1 of List II of the Seventh Schedule as they are meant to avoid disturbances to the public order by prohibiting conversion from one religion to another in a manner reprehensible to the conscience of the community. The two Acts do....
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....topics and, within the ambit of the words, the most sovereign powers must be understood to be given to the Legislature. It has been further held that the entries in the Constitution Act should be given a large and liberal interpretation, the reason being that the allocation of the subjects in the three Lists is not by way of scientific definition but by way of a mere simplex enumeratio of broad categories, [see the observations made by their Lordships of the Federal Court In the matter of the Central Provinces and Berar Sales of Motor Spirit and Lubricants Taxation Act [(1939) A.I.R. (F.C.) 1.] . Dealing with the question of the interpretation of the subjects in the three Legislative Lists, it was observed by his Lordship Gwyer, C.J., in A.L.S.P.P.L., Subrahmanyan Chettiar v. Muttuswami Goundan [(1941) A.I.R. (F.C.) 47.], as follows:- "It must inevitably happen from time to time that legislation, though purporting to deal with a subject in one list, touches also on a subject in another list, and the different provisions of the enactment may be so closely intertwined that blind adherence to a strictly verbal interpretation would result in a large number of statutes being de....
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....n of foodstuffs and other goods, merely because the subject may, in some of its aspects, be connected with, public safety. In the same way the maintenance of public order undoubtedly involves considerations of public safety, but surely that would not be a ground for holding that the Provincial Legislature is not competent to make laws for the maintenance of public order. It is worthy of note that, apart from the general subject, of 'Public Order' mentioned in item 1 of the Provincial Legislative List, one particular aspect of public order namely, preventive detention for reasons connected with the maintenance of public order, is specifically mentioned. I emphasise the words "for reasons connected with the maintenance of public order" One of the reasons connected with the maintenance of public order may well, be public safety. If we consider the scope and purpose of the Act as a whole, then the conclusion at which one is bound to reach is that in its true nature and character it deals with the maintenance of public order involving, no doubt, considerations of public safety as well. In the context in which the expression "public safety" occurs in the preamble and in section 2(1) of t....
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....t II. It would have been enough to decide that it came within the subjects mentioned in either of the two lists or the two lists taken together. It cannot, therefore, be said that the Federal Court had decided that public safety as a subject of legislation would not come within item 1 of List II; on the contrary, the observation was to the effect that the expression 'reasons connected with the maintenance of public order' was wide enough to include 'public safety or interest'. As I have already stated, many of the subjects mentioned in the three lists have a 'public safety' aspect and the maintenance of public order undoubtedly includes, public safety. There are certain other observations in another decision of the Federal Court [Kashav Talpade v. King-Emperor [(1943) 24 Pat. L.T. 158, F.C.] ] on which learned Counsel for the petitioners places some reliance. These observations which will be found at pages 173 and 174 of the report are:- "If a detaining authority gives four reasons for detaining a man, without distinguishing between them, and any two or three of the reasons are held to be bad, it can never be certain to what extent the bad reasons operated on the mind of t....
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....ercise of legal rights by others or imperil the public safety and health. If that be so the matter must fall within the restrictions which the Constitution itself visualizes as permissible in the interest of public order, or in the interest of the general public. We may say, however, that annoyance must assume sufficiently grave proportions to bring the matter within interests of public order." (Emphasis Supplied) 343. Further, in S. Bagavathy v. State of Tamil Nadu, reported in 2007 SC OnLine Mad 218 a Full Bench of the Madras High Court held that public order has comprehensive meaning to include public safety in relation to maintenance of public order and explicitly stated that public order, public safety, public tranquility, and public interest are overlapping terms. It also clarified that public order need not always be traced only to violence like riot or insurrection. It concerns an orderly state of society in which citizens peacefully pursue normal activities. Relevant paragraphs are reproduced here below: "120. In our considered opinion, on the question, whether the impugned enactment can be sustained under Entry 1, viz. Public Order, it should be remem....
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....r but rather the potentiality of the act, in question. In the Court's view, one act may affect only individuals, while the other though of a similar kind may have such an impact that it would disturb the even tempo of the life of the community. "3. The submission of the counsel is that these are stray acts directed against individuals and are not subversive of public order and therefore the detention on the ostensible ground of preventing him from acting in a manner prejudicial to public order was not justified. In support of this submission reference is made to three cases of this Court: Dr Ram Manohar Lohia v. State of Bihar [(1966) 1 SCR 709] ; Pushkar Mukherjee v. State of W.B. [ WP No. 179 of 1968, decided on November 7, 1968 : (1969) 1 SCC 10] and Shyamal Chakraborty v. Commissioner of Police, Calcutta [WP No. 102 of 1969, decided on August 4, 1969 : (1969) 2 SCC 426] . In Dr Ram Manohar Lohia case [(1966) 1 SCR 709] this Court pointed out the difference between maintenance of law and order and its disturbance and the maintenance of public order and its disturbance. Public order was said to embrace more of the community than law and order. Public order is the even te....
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....on agencies. It means therefore that the question whether a man has only committed a breach of law and order or has acted in a manner likely to cause a disturbance of the public order is a question of degree and the extent of the reach of the act upon the society. The French distinguish law and order and public order by designating the latter as order publique. The latter expression has been recognised as meaning something more than ordinary maintenance of law and order. Justice Ramaswami in Writ Petition No. 179 of 1968 drew a line of demarcation between the serious and aggravated forms of breaches of public order which affect the community or endanger the public interest at large from minor breaches of peace which do not affect the public at large. He drew an analogy between public and private crimes. The analogy is useful but not to be pushed too far. A large number of acts directed against persons or individuals may total up into a breach of public order. In Dr Ram Manohar Lohia case examples were given by Sarkar and Hidayatullah, JJ. They show how similar acts in different contexts affect differently law and order on the one hand and public order on the other. It is always a q....
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...., in the course of which its registers and other papers were destroyed by acts of arson, falls within the area of public order although it was aimed at an individual entity because of its potentiality to cause reverberations affecting the even tempo of community life. "8. The detention order, no doubt, mentioned that it was issued with a view to prevent the detenu acting prejudicially to the maintenance of public order. The contention raised by counsel, however, involves the question whether the acts alleged against the detenu constituted breach of public order or were such as would be prejudicial to its maintenance. As to what is meant by the expression, "public order", Hidayatullah, J., (as he then was) in Lohia v. State [(1966) 1 SCR 709: AIR 1966 SC 740] said that any contravention of law always affected order, but before it could be said to affect "public order", it must affect the community or the public at large. He considered three concepts viz. "law and order", "public order" and "the security of the state" generally used in preventive detention measures and suggested that to appreciate the scope and extent of each of them, one should imagine three concentric circ....
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....ity, though similar in quality, would differ in potentiality in the sense that it might cause reverberations which might affect the even tempo of the life of the community. As the Court pointed out, "the act by itself is not determinant of its own gravity. In its quality it may not differ but in its potentiality it may be very different." At the same time, the power of detention having been permitted to the State under the Constitution as an exceptional power, its exercise had to be scrutinised with extreme care and could not be used as a convenient substitute for the normal processes of the criminal law of the country. (Cf. S.K. Saha v. Commissioner of Police, Calcutta). [(1970) 1 SCC 149 : (1970) 3 SCR 360]. 10. These are all cases under the Preventive Detention Act, 4 of 1950, which by Section 3 of it confers power of detention on specified grounds which include acts prejudicial to the maintenance of public order. The present Act likewise confers such power with a view to prevent a person from acting in any manner prejudicial to the security of the State or the maintenance of public order under its Section 3(1). Though the Act does not define the expression "public orde....
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....n the school building thereby endangering the life of the teaching staff and the students attending the school. The second, of April 5, 1970, was that the petitioner along with some others again trespassed into the same school and set fire to parts of it and then threatened the members of its staff with death if they offered resistance or disclosed his name to any authority. 13. The target of arson, (assuming the allegations to be true which we have to assume) was an educational institution and particularly the registers and other papers maintained by it. The object obviously was vandalism, to disrupt its working by burning its records and to create a scare so that neither the teaching staff nor the pupils would dare attend it for prosecution of studies. The parents dare not hence-forth send their wards for fear that the school might be set on fire while they are in it. The bomb was manifestly placed in the premises for creating that scare. It could not have been intended for any other purpose after the records and furniture had been set on fire. In these circumstances, the alleged acts did not merely constitute mischief under Section 425 of the Penal Code, but constituted....
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.... but committed in different contexts and circumstances, might cause different reactions. In one case it might affect specific individuals only, and therefore touches the problem of law and order only, while in another it might affect public order. The Act by itself, therefore, is not determinant of its own gravity. In its quality it may not differ from other similar acts, but in its potentiality, that is, in its impact on society, it may be very different. On the basis of such a distinction, an attack on an educational institution, in the course of which its registers and other papers were destroyed by acts of arson, was held to fall within the area of public order although it was aimed at an individual entity. (See Nagendra Nath Mondal v. West Bengal. [(1972) 1 SCC 498 : 1972 SCC (Cri) 227]) The criterion thus being the potentiality of the Act in question or the degree of its impact on members of the community in the locality in which the act in question is committed, examination of Ground 2 from that angle would appear to be more appropriate. 7. The act in Ground 2, no doubt, was an attack resulting in the death of the victim, and though it was said to have been committe....
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.... "53. These observations determine the meaning of the words "public order" in contradistinction to expressions such as "public safety", "security of the State". They were made in different contexts. The first three cases dealt with the meaning in the legislative lists as to which, it is settled, we must give as large a meaning as possible. In the last case the meaning of "public order" was given in relation to the necessity for amending the Constitution as a result of the pronouncements of this Court. The context in which the words were used was different, the occasion was different and the object in sigh was different. 54. We have here a case of detention under Rule 30 of the Defence of India Rules which permits apprehension and detention of a person likely to act in a manner prejudicial to the maintenance of public order. It follows that if such a person is not detained public disorder is the apprehended result. Disorder is no doubt prevented by the maintenance of law and order also but disorder is a broad spectrum which includes at one end small disturbances and at the other the most serious and cataclysmic happenings. Does the expression "public order" take in....
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....la v. State of Telangana, reported in (2021) 9 SCC 415 which re-stated that "public order" disturbance requires "public disorder" and community-level impact vide paragraphs 3 and 14: "3. As is well-known, the expressions "law and order", "public order", and "security of State" are different from one another. In Ram Manohar Lohia v. State of Bihar [Ram Manohar Lohia v. State of Bihar, (1966) 1 SCR 709 : AIR 1966 SC 740 : 1966 Cri LJ 608] the question before this Court arose under a preventive detention order made under Rule 30 of the Defence of India Rules, which permits apprehension and detention of a person likely to act in a manner prejudicial to the maintenance of public order. This Court set out the distinction between a mere law and order disturbance and a public order disturbance as follows : (SCR pp. 738-39 & 745-46 : AIR pp. 755 & 758-59, paras 42 & 51-52) "42. The Defence of India Act and the Rules speak of the conditions under which preventive detention under the Act can be ordered. In its long title and the preamble the Defence of India Act speaks of the necessity to provide for special measures to ensure public safety and interest, the defence of India....
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.... which we quoted earlier and which follows the scheme of Section 3(15). The question is whether by taking power to prevent Dr Lohia from acting to the prejudice of "law and order" as against "public order" the District Magistrate went outside his powers. *** 51. We have here a case of detention under Rule 30 of the Defence of India Rules which permits apprehension and detention of a person likely to act in a manner prejudicial to the maintenance of public order. It follows that if such a person is not detained public disorder is the apprehended result. Disorder is no doubt prevented by the maintenance of law and order also but disorder is a broad spectrum which includes at one end small disturbances and at the other the most serious and cataclysmic happenings. Does the expression "public order" take in every kind of disorders or only some of them? The answer to this serves to distinguish "public order" from "law and order" because the latter undoubtedly takes in all of them. Public order if disturbed, must lead to public disorder. Every breach of the peace does not lead to public disorder. When two drunkards quarrel and fight there is disorder but not public disor....
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.... Bagavathy v. The State of Tamil Nadu reported in (2007) 2 CTC 207, the full Bench of the Madras High Court dealt with the constitutional validity of the Tamil Nadu Protection of Interests of Depositors, 1997 ("TNPID Act"), which was enacted to protect vulnerable depositors from fraudulent financial establishments that defaulted on repayments, causing public resentment. The legislative competence of the Act was challenged on the ground that banking is a Union subject. 352. The High Court, therefore, dealt with the question of whether the TNPID Act providing for companies to deposit money would qualify as 'banking activity' and therefore be rendered unconstitutional for being ultra vires of the power of the state legislature. In answering this question, the Court held that the Act's true nature was not to regulate banking, but to maintain public order and address delinquency in unincorporated finance, which falls under the State List. The State acted within its competence as parens patriae (guardian) to protect depositors. 353. Applying the test of potentiality of the Act to disturb the even tempo of community life, the High Court went on to hold that public order is the basic....
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....2 and therefore, public order is totally a different concept; that there should be actual physical force to danger to life and property or there should be threat to life and property; and that since the framers of Constitution originally included preventive detention, but the same was subsequently taken away and in that context, public order should be looked into. But, we are unable to appreciate such contention, because the Apex Court in State of U.P. v. Sanjai Pratap Gupta, (2004) 8 SCC 591, following its earlier decision in Arun Gosh v. State of West Bengal, referred supra, held that Public order, law and order and the security of the State fictionally draw three concentric circles, the largest representing law and order, the next representing public order and the smallest representing security of the State. Every infraction of law must necessarily affect order, but an act affecting law and order may not necessarily also affect public order. Likewise, an act may affect public order, but not necessarily the security of the State. The true test is not the kind, but the potentiality of the act in question. One act may affect only individuals while the other, though of a similar kin....
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.... 132. On the other hand, the attempt of the financiers exploiting the anguish of the depositors, is nothing but a notorious abuse of the innocent desire of the depositors for higher rate of interest for the small savings that they invested, for which they have been given a small passbook as a token of their acknowledgment, which they consider as a passport for their children higher education in some cases, or wedding of daughters in some other, and as a policy medical insurance in the case of most of the aged retired depositors, but in reality, in all cases, an unsecured promise executed on a waste paper. The senior citizens above 80 years, senior citizens between 60 and 80 years, widows, handicapped, driven out by wards, retired Government servants and pensioners, living below the poverty line, and similarly placed persons constitute the community of depositors. If their grievance is not taken as public interest, or public safety, the words, 'public safety' and 'public interest' would be only dead letters. Is it not the duty of the State to curb such mismanagement and malpractice indulged by the financial establishments adopting unscrupulous attempt? 133. Obviously....
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....ocent depositors. The grim picture of the entire episode enacted by financiers is nothing but to gamble upon the appetite of the innocent depositors for higher rate of interest and to steal out the entire sterilized savings of the innocent depositors diplomatically under the banner of white collar financial establishments, out of their appetite for higher rate of interest and finally to siphon of them in entirety. In the name of attractive rate of interest, the financiers adopted unique, modus operandi mesmerizing the depositors to deposit their hard earned money under different schemes, which are nothing but have an anti-social impact on the community at large. Then, is it not the responsibility of the welfare State, who have owed to establish/maintain socio-economic justice in the society? 136. If no law could be made to curb such activities of the financial establishments effectively and to realise the dues payable to the depositors, an anomalous situation would have been created, viz., these financial establishments would continue their business and divert the funds clandestinely by mala fide transferring and would siphon of the funds of the depositors, and finally wou....
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....t." (Emphasis Supplied) 354. The above-referred decision of the Madras High Court in S. Bagavathy (supra) was subsequently upheld by this Court in New Horizon Sugar Mills Ltd. v. Govt. of Pondicherry, reported in (2012) 10 SCC 575, wherein this Court affirmed the validity of depositor-protection legislation and acknowledged that transaction integrity and protection of depositors can be deeply relevant to securing public order. It treated such legislation as relatable to Entry 1 of List II due to the societal destabilization caused by large-scale depositor frauds. g. Proximate Nexus Requirement 355. Finally, even though "public order" has been consistently interpreted to be wide in connotation, this Court has also emphasized the requirement that restrictions or measures justified on public order grounds must have a real, proximate connection to the public order sought to be protected, and not a remote, hypothetical or far-fetched relation. This requirement was elaborately explained in Supdt., Central Prison v. Ram Manohar Lohia, reported in 1960 SCC OnLine SC 43 while interpreting the meaning of "in the interest of public order" in Article 19(2) of the Constitution, in t....
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....ct to the elementary need for order without which the guarantee of those rights would be a mockery". The expression has not been defined in the Constitution, but it occurs in List II of its Seventh Schedule and is also inserted by the Constitution (First Amendment) Act, 1951 in clause (2) of Article 19. The sense in which it is used in Article 19 can only be appreciated by ascertaining how the Article was construed before it was inserted therein and what was the defect to remedy which the Parliament inserted the same by the said amendment. The impact of clause (2) of Article 19 on Article 19(1)(a) before the said amendment was subject to judicial scrutiny by this Court in Romesh Thappar v. State of Madras [(1950) SCR 594, 600, 601, 602]. There the Government of Madras, in exercise of their powers under Section 9(1-A) of the Madras Maintenance of Public Order Act, 1949, purported to issue an order whereby they imposed a ban upon the entry and circulation of the journal called the "Cross Roads" in that State. The petitioner therein contended that the said order contravened his fundamental right to freedom of speech and expression. At the time when that order was issued the expression....
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.... the offences against public order are divided into two categories viz. (a) major offences affecting the security of the State, and (b) minor offences involving breach of purely local significance. This Court in Brij Bhushan v. State of Delhi [(1950) SCR 605] followed the earlier decision in the context of Section 7(1)(c) of the East Punjab Public Safety Act, 1949. Fazl Ali, J., in his dissenting judgment gave the expression "public order" a wider meaning than that given by the majority view. The learned Judge observed at p. 612 thus: "When we approach the matter in this way, we find that while 'public disorder' is wide enough to cover a small riot or an affray and other cases where peace is disturbed by, or affects, a small group of persons, 'public unsafety' (or insecurity of the State), will usually be connected with serious internal disorders and such disturbances of public tranquillity as jeopardize the security of the State." This observation also indicates that "public order" is equated with public peace and safety. Presumably in an attempt to get over the effect of these two decisions, the expression "public order" was inserted in Article....
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.... of riot, disorder, interference with traffic upon the public streets, or other immediate threat to public safety, peace, or order appears, the power of the State to prevent or punish is obvious." The American decisions sanctioned a variety of restrictions on the freedom of speech in the interests of public order. They cover the entire gamut of restrictions that can be imposed under different heads in Article 19(2) of our Constitution. The following summary of some of the cases of the Supreme Court of America given in a well-known book on Constitutional law illustrates the range of categories of cases covering that expression. "In the interests of public order, the State may prohibit and punish the causing of 'loud and raucous noise' in streets and public places by means of sound amplifying instruments, regulate the hours and place of public discussion, and the use of the public streets for the purpose of exercising freedom of speech; provide for the expulsion of hecklers from meetings and assemblies, punish utterances tending to incite an immediate breach of the peace or riot as distinguished from utterances causing mere 'public inconvenience, annoyance or unrest'". In En....
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.... language employed in the amended clause is 'in the interests of' and not 'for the maintenance of'. As one of us pointed out in Debi Saron v. State of Bihar [AIR (1954) Pat 254] the expression 'in the interests of' makes the ambit of the protection very wide. A law may not have been designed to directly maintain public order and yet may have been enacted in the interests of public order." The learned Chief Justice again in Virendra v. State of Punjab [(1958) SCR 308] observed, at p. 317, much to the same effect: "As has been explained by this Court in Ramji Lal Modi v. State of U.P. [(1957) SCR 860] the words 'in the interests of' are words of great amplitude and are much wider than the words 'for the maintenance of'. The expression 'in the interests of' makes the ambit of the protection very wide, for a law may not have been designed to directly maintain the public order or to directly protect the general public against any particular evil and yet it may have been enacted "in the interests of" the public order or the general public as the case may be." We do not understand the observations of the Chief Justice to mean that any remote or fanciful connecti....
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.... in the chain of relation to the maintenance of public order that preventive detention on account of them cannot, in our opinion, fall within the purview of Entry I of List II. ... The connection contemplated must, in our view, be real and proximate, not far-fetched or problematical." The decision, in our view, lays down the correct test. The limitation imposed in the interests of public order to be a reasonable restriction, should be one which has a proximate connection or nexus with public order, but not one far-fetched, hypothetical or problematical or too remote in the chain of its relation with the public order. (Emphasis Supplied) h. Public Order in the Age of Internet, Computer, and Cyber Laws 356. This Court has also addressed the meaning and limits of public order in the context of internet-based communication and cyber regulation in Shreya Singhal v. Union of India, reported in (2015) 5 SCC 1, which examined the constitutionality of Section 66A of the Information Technology Act, 2000. While analyzing whether restrictions on online speech could be justified under Article 19(2), the Court reiterated that "public order" remains rooted in its ....
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....of State', 'law and order' also comprehends disorders of less gravity than those affecting 'public order'. One has to imagine three concentric circles. Law and order represents the largest circle within which is the next circle representing public order and the smallest circle represents security of State. It is then easy to see that an act may affect law and order but not public order just as an act may affect public order but not security of the State." 37. In Arun Ghosh v. State of W.B. [(1970) 1 SCC 98 : 1970 SCC (Cri) 67 : (1970) 3 SCR 288], Ram Manohar Lohia case [Ram Manohar Lohia v. State of Bihar, (1966) 1 SCR 709 : AIR 1966 SC 740 : 1966 Cri LJ 608] was referred to with approval in the following terms : (SCC pp. 99-100, para 3 : SCR pp. 290-91) "... In Ram Manohar Lohia case [Ram Manohar Lohia v. State of Bihar, (1966) 1 SCR 709 : AIR 1966 SC 740 : 1966 Cri LJ 608] this Court pointed out the difference between maintenance of law and order and its disturbance and the maintenance of public order and its disturbance. Public order was said to embrace more of the community than law and order. Public order is the even tempo of the life of the community taking ....
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.... question whether a man has only committed a breach of law and order or has acted in a manner likely to cause a disturbance of the public order is a question of degree and the extent of the reach of the act upon the society. The French distinguish law and order and public order by designating the latter as order publique. The latter expression has been recognised as meaning something more than ordinary maintenance of law and order. Justice Ramaswami in Pushkar Mukherjee v. State of W.B. [(1969) 1 SCC 10] drew a line of demarcation between the serious and aggravated forms of breaches of public order which affect the community or endanger the public interest at large from minor breaches of peace which do not affect the public at large. He drew an analogy between public and private crimes. The analogy is useful but not to be pushed too far. A large number of acts directed against persons or individuals may total up into a breach of public order. In Ram Manohar Lohia case [Ram Manohar Lohia v. State of Bihar, (1966) 1 SCR 709 : AIR 1966 SC 740 : 1966 Cri LJ 608] examples were given by Sarkar, and Hidayatullah, JJ. They show how similar acts in different contexts affect differently law ....
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.... or otherwise without in any manner impacting public order. 39. It will be remembered that Holmes, J. in Schenck v. United States [63 L Ed 470 : 249 US 47 (1919)], enunciated the clear and present danger test as follows : (L Ed pp. 473-74) "... The most stringent protection of free speech would not protect a man in falsely shouting fire in a theatre and causing a panic. It does not even protect a man from an injunction against uttering words that may have all the effect of force. Gompers v. Buck's Stove & Range Co. [221 US 418 : 31 S Ct 492 : 55 L Ed 797 : 34 LRA (NS) 874 (1911)], US p. 439. The question in every case is whether the words used are used in such circumstances and are of such a nature as to create a clear and present danger that they will bring about the substantive evils that Congress has a right to prevent. It is a question of proximity and degree." 40. This was further refined in Abrams v. United States [250 US 616 : 63 L Ed 1173 (1919)], this time in a Holmesian dissent, to be clear and imminent danger. However, in most of the subsequent judgments of the US Supreme Court, the test has been understood to mean to be "clear and....
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....t of freedom of expression demands that it cannot be suppressed unless the situations created by allowing the freedom are pressing and the community interest is endangered. The anticipated danger should not be remote, conjectural or far-fetched. It should have proximate and direct nexus with the expression. The expression of thought should be intrinsically dangerous to the public interest. In other words, the expression should be inseparably locked up with the action contemplated like the equivalent of a 'spark in a power keg'." xxx xxx xxx 43. In Ramji Lal Modi v. State of U.P. [1957 SCR 860 : AIR 1957 SC 620 : 1957 Cri LJ 1006], SCR at p. 867, this Court upheld Section 295-A of the Penal Code only because it was read down to mean that aggravated forms of insults to religion must have a tendency to disrupt public order. Similarly, in Kedar Nath Singh v. State of Bihar [1962 Supp (2) SCR 769 : AIR 1962 SC 955 : (1962) 2 Cri LJ 103], Section 124-A of the Penal Code, 1860 was upheld by construing it narrowly and stating that the offence would only be complete if the words complained of have a tendency of creating public disorder by violence. It was added that merely....
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....59. Correspondingly, disruption or disturbance of public order public order arises in the following situations: a) An act disturbs public order when it affects the current or even tempo of the life of the community, rather than merely injuring an individual; b) When repercussions of an act extend to large sections of the community, inciting further breaches of law and order or provoking communal passions, public order is subverted; c) Activities that impair public health or constitute a manifest nuisance fall squarely within the State's competence under public order; d) Activities that cause detriment of health, tranquility and comfort of others; e) If something disturbs the current of the life of the community, and does not merely affect an individual; f) Conduct which induces fear or panic in the community such that ordinary pursuits of life are abandoned becomes a matter of public order even if the immediate act is aimed at a particular individual; g) Disturbances in the social or economic spheres that shake the orderly functioning of society, including large-scale financial defaults undermining public confidence, ma....
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....es a grave threat to public tranquility. The Gujarat High Court had expressed concerns over the Youth falling prey to Internet Gambling, in the judgment titled Amit M. Nair v. State of Gujarat reported in AIR OnLine 2020 Guj 2072 wherein the Court observed the following: "Internet gambling presents essentially many of the same concerns that the traditional gambling activities have raised throughout the years: uneasiness about the morality of the activity; the likelihood of addiction; the possibility of fraud; and the conflict between the state versus central regulations. The questions of morality primarily surface in connection with the Internet gambling's accessibility to children because children have potentially unlimited access to the computers and the Internet. It is possible that without proper monitoring they may access to the gambling Websites as readily as they could access the indecent materials. The supporters of a ban of Internet gambling maintain that outlawing the activity for all individuals is the only way to ensure that a segment of the population, children, will be adequately protected from corruption." (Emphasis Supplied) 364. Moreover, t....
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....wage, conditions of work ensuring a decent standard of life and full enjoyment of leisure and social and cultural opportunities, to protect the weaker sections of the people from social injustice and all forms of exploitation, to raise the standard of living of its people and the improvement of public health. The question canvassed before us is whether the Constitution makers who set up such an ideal of a welfare State could possibly have intended to elevate betting and gambling on the level of country's trade or business or commerce and to guarantee to its citizens the right to carry on the same. There can be only one answer to the question." (Emphasis Supplied) 368. Ms. Anjali Nagpal, a neuropsychiatrist who has studied the issue closely, said 'gambling disorder' is silently becoming an epidemic in India and is being normalized. "When favorite celebrities openly promote them across social media, youngsters start to feel less like [it's] a risky activity and more like a trendy thing to do. It creates a false sense of security and on seeing their heroes endorsing it, their thought is: 'How bad can it be?" Nagpal said in an interview re....
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....the definition "instruments of gaming". c) The phrase "gaming" under Section 2(7), means all forms of wagering or betting using money, tokens valued in terms of money and every other form of virtual currency and electronic transfer of funds. The explanation to the provision makes it very clear that collection, soliciting, receipt or distribution, any act or risking money, or otherwise on the unknown result of an event including on a game of skill would constitute wagering or betting and would therefore squarely fall within the definition of gaming. d) Section 2(12A) introduces the definition for online gaming. The provision makes it very clear that all forms of gaming, as defined under Section 2(7), when played with instruments of gaming like computers, applications and mobile phones or other virtual platforms, would constitute online gaming. e) Section 78(1)(a) of the 1963 Police Act makes it an offence for the owner and occupier of online gaming platforms that involve betting or wagering, and which is opened for the purpose of gaming. When such a platform is used for the following two purposes (as given in sub-clause (vi) and (vii)), then the offender i....
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....no occasion for this Court to consider the scope of the term "betting" as it appears in the expression "betting and gambling" in Entry 34 List II, and also the nature of the conjunction "and" joining the two words, while rendering the decisions in RMDC-I (supra) and RMDC-II (supra) respectively. d) While it may be true that games of skill may not get covered by the expression "gambling", it is not correct to say that even "betting" on games of skill would be out of the competence of the State Legislature to legislate upon. e) In K.R. Lakshmanan (supra), the scope of the expression "betting and gambling" as appearing in Entry 34 was not the subject matter of determination, rather, the issue pertained to whether horse racing would be entitled to the protection of the exception that the State Legislature had itself carved out for games of "mere skill" under Section 49 of the 1963 Police Act and Section 11 of the 1930 Gaming Act respectively. f) The decision in K.R. Lakshmanan (supra) has no application to cases like the one at hand where the State Legislature, in its wisdom, has deemed it appropriate to regulate games where monetary stakes are involved, with....
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.... wagering on any game, be it a game of skill, would not be entitled to receive any such protection, unless the Legislature creates an exception in favour of such betting on games of skill. n) The competence of the State to regulate certain activity also enables it to prohibit the same activity, subject to Part III of the Constitution, if applicable. The 2021 Amendment has not provided a sweeping definition or a "Midas touch". It has merely brought every form of betting and gambling under its sweep, and for that the States are empowered under Entry 34 List II. In absence of availability of the protection of Article 19, total prohibition would not be hit by the test of proportionality. o) The phrase "gaming" cannot be said to be nomen juris. The phrase "gaming" is a statutory definition that can be altered according to the will of the Legislature. In no way can it be dependent on the element of chance alone. The definition of "gaming" is fluid and fluctuating across the states and different legislations. p) In terms of addiction, in terms of monetary losses and in terms of resultant widespread suicides respectively, online money gaming has a definite impact....