Morung Express News
Dimapur | May 24
A Public Interest Litigation (PIL) filed in the Delhi High Court has, among other things, challenged provisions in the ‘Nagaland Prohibition of Gambling and Promotion and Regulation of Online Games of Skill Act, 2016,’ contending that “the state Legislature has permitted people to lay waste to their fortune, hard earned money, and possible inheritance, by permitting them to play games of pure chance, under the garb of calling them games of skill.”
A report in the online news website indaweb2 stated that the petition filed by social activist and Chartered Accountant, Avinash Mehrotra sought directions to the Union Ministry of Information Technology and the Reserve Bank of India (RBI) “to bring illegal and illicit online gambling/betting/wagering/gaming to an end.”
The ‘Nagaland Prohibition of Gambling and Promotion and Regulation of Online Games of Skill Act’ was introduced in the Nagaland Legislative Assembly in 2015.
“The Bill seeks to regulate and promote the conduct of online ‘Games of skill’ with the primary objective of earning revenue for the state government by way of licensing fees and royalty,” the then Chief Minister, TR Zeliang had stated while introducing the bill at the floor of the house.
The following year, the Nagaland State Governor signed the Act, enabling Nagaland to become the first Indian state to formally authorize online games of skill for stakes. The same year, Nagaland state also became the first gambling jurisdiction in the country to award a license to an online poker operator.
According to several reports, the Nagaland State Lotteries office had awarded an online skill games license to M/s K365 Web Assets Pvt Ltd, which operates online poker and rummy portal Khelo365.com. The state also began issuing Letters of Intent (LOI) to would-be skill game licensees, with the first LOI going to Club Empire Tech Pvt Ltd. Nagaland issued a further 10 LOIs to different companies but K365 was first to get its paperwork past the government inspectors.
The recent report in indaweb2 informed that these licenses are “granted to the applicant by the Nagaland State Lotteries and a license obtained from one state cannot be legitimate across the country.”
In his petition, Mehrotra argued that the Nagaland online skill gaming law cannot have a pan-India operation and that these activities remain illegal in the rest of the country.
He stated that several websites are encouraging the country’s working population to part with their money on games of chance such as poker, teenpatti, sports betting, election betting etc. He also asserted that the popularity of fantasy sports is rising, where unsuspecting players are betting large quantities of money on the individual performance of players.
Mehrortra, in his petition, further said that some of the websites offering games are based in India while others are based abroad, says the petitioner. The websites named in the petition include both offshore as well as local India-based betting websites including Betway, BetRally India, 1xBet, Royal Panda, Dafabet etc and domestic poker websites such as Adda52, PokerStars.in and Khelo365.
The petition contended that “these websites seem to encourage the horrible habit of gambling amongst youngsters, and are doing so solely with a view of making large amounts of profits at the cost of these unsuspecting citizens of our great nation.”
Further, the PIL alleged that large sums of money are being placed using foreign currency on offshore betting websites leading to exodus of foreign exchange leaving India, which amounts to a violation of the Foreign Exchange Management Act (FEMA) and rules.
The PIL has asked for a direction from the Delhi High Court to ask the Union Ministry of Information Technology to ban/prevent online gaming websites under Sections 67 and 69 of the Information Technology Act, 2000.
It also urged the court to issue direction to the RBI to check the exodus of foreign exchange on online gambling websites. It further asked for a direction to the Ministry of Finance to recover taxes due from players and operators as well as prosecution of operators and promoters of online gaming websites.
According to the report, the matter is scheduled to come up for hearing before a division bench of the Delhi High Court, comprising of Chief Justice Rajendra Menon and Justice Anup Bhambhani on May 29.
