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Trending: Call for Papers Volume 3 | Issue 2: International Journal of Advanced Legal Research [ISSN: 2582-7340]

Legalising Sports Betting In India

INTRODUCTION

Gambling and betting is ubiquitous in Indian society and mostly done surreptitiously. Sports betting is the activity of predicting sports results and placing a wager on the outcome. 

BETTING IN INDIA

Horse Racing Betting- Horse racing has long been a popular sport in India. Betting on horse racing has been legalized at state level. Bookmakers offer their services legally at these racecourses, along with the tote operators who provide pool betting.
Lotteries- It is another form of gambling which isn’t so strictly prohibited in India. The Lotteries (Regulation) Act of 1998 was passed to govern the operation of lotteries. The act specified that a maximum of one draw per week was to be allowed, but it doesn’t appears to be enforced too rigidly.
Casino Gambling- There are two state governments in India which have passed state-level legislation to allow legalized casino gambling. Goa was the first to do so and Sikkim was the next State to legalize casino gambling.
Online Gambling- The Public Gaming Act of 1867 makes no reference to online gambling because interest was a long way from being invented when the Act was introduced.
The Information Technology Act of 2000 makes provisions for various offences relating to online activity, although again there is no specific mention of online gaming being illegal.
In Sikkim, the government now has the authority to issue licences to operators wishing to provide online gaming services within the state. It is also permitted in Nagaland. This is a notable step forward for regulated gambling in India.
IPL- It is the event which attracts the largest amount of betting interest in India. The Twenty20 tournament is the most successful of its type in the world. In India cricket is the sport that people are most likely to bet on.

LAWS DEALING WITH GAMBLING IN INDIA

The first attempt to control gambling was made in 1867 with the Public Gambling Act which provided for punishment for public gambling and keeping of common gaming houses. Section 2 of the Act authorised each territory (now each state) to extend the Act to the State.
The Bombay Prevention of Gambling act came into force in 1887. Gambling as defined in the Act includes gaming and betting.
Constitution has enabled the State Government to formulate their own laws and there exist no uniformity among state laws and mostly deal with Physical Gambling while Online Gambling remains out of the scope.
Section 67 of the Information Technology Act of 2000 vaguely deals with online gambling which prohibits online transmission and publication of material which “corrupt” persons.
From the various provisions of the Central and State Act, one can infer that while gambling is prohibited in public or public giving houses, there is no prohibition on such activities in a private house.

REGULATION

In 2016, while examining the Lodha Committee recommendations on legalising betting in sport, the Supreme Court asked the law commission to look into the narrow question of legalising betting in cricket. The court’s reference had come in its judgement in Board of Control for Cricket v. Cricket Association of Bihar & Ors,[i] involving illegal betting in IPL cricket matches.

LAW COMMISION REPORT

The Law Commission, headed by former Supreme Court judge, Justice B S Chauhan, has submitted Report No. 276, Legal Framework: Gambling and Sports Betting including in Cricket in India to the government.[ii]

  • The commission has stated that since it is impossible to stop illegal gambling, the only viable option left is to regulate gambling in sports. The Parliament may enact a model law for states or alternatively may legislate in the exercise of its powers under Article 249 and 252 of the Constitution which allows it to enact a law on a state subject in larger national interest.
  • It has recommended cashless gambling in sports as means to increase revenue and deal a blow to unlawful gambling. 
  • Such activities, if properly regulated would ensure transparency in the market, as also strike at the underworld’s control over the illegal and unregulated gambling industry. 
  •  The money generated can be used for public welfare activities. For that the revenue from gambling should be taxable under laws like the Income Tax Act, the Goods and Service Tax Act. 
  •  Transactions between gamblers and operators should be linked to the Aadhaar and PAN cards so that the government could keep an eye on them. 
  •  The commission has specified a minimum age of 18 years and above to gamble. 
  • The commission recommended a classification of ‘proper gambling’ and ‘small gambling’. Proper gambling would be for the rich who play for high stakes, while small gambling would be for the low-income groups. 
  • The panel wants the government to introduce a cap on the number of gambling transactions for each individual, that is, monthly, half yearly and annual. Restrictions on amount should be prescribed while using electronic money facilities like credit cards, debit cards, and net banking. Gambling websites should also not solicit pornography. 
  •  The commission has recommended that match fixing and sports fraud should be specified as criminal offences with severe punishment. 
  • Gambling and betting, if any, should be offered only by Indian licensed operators from India processing valid licences granted by the game licensing authority. 
  •  Regulations need to protect vulnerable groups, minors and those below the poverty line, those who draw their sustenance from social welfare measures, government subsidies and Jan Dhan account holders from exploitation to gambling. 
  • According to the commission, Foreign Exchange Management and Foreign Direct Investment laws and policies should be amended to encourage investment in the casino/online gaming industry. This would propel tourism and employment. 

CONCLUSION

A study by auditing firm KPMG revealed that betting to the tune of Rs. 3 lakh crore take place annually in India. If this is made legal, then the government would earn a revenue of Rs. 12,000 to 19,000 crore per annum. Legalizing the activity will help curtail an important source of black money that is used by criminals syndicates and will bring massive revenue to the state exchequer, which can be used for various constructive social schemes.
Naysayers say that gambling is responsible for addiction, loss of livelihoods and invariably leads to moral and monetary bankruptcy. A robust regulatory framework governing the gaming sector will ensure that people do not fall prey to the excesses of gambling. Awareness campaign should educate people about the perils of excessive gambling.

[i] (2016) 8 SCC 535.
[ii]Source: : India. Law Commission of India, Report no.276 on LEGAL FRAMEWORK: GAMBLING AND SPORTS BETTING INCLUDING IN CRICKET IN INDIA, July 2018, pp. 96-99

This blog is authored by Sneha Bachhawat

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