Justice J.B. Pardiwala, Justice R. Mahadevan, Supreme Court

The Supreme Court has held that the protection afforded to games of skill under Entry 34 of List II of the Seventh Schedule to the Constitution of India, cannot be construed as protection to betting on those games, which essentially becomes a gambling enterprise. Overturning the judgments of the High Courts, the Court held that State legislatures are fully competent under Entry 34 to prohibit betting on games of skill, and that the constitutional immunity historically associated with skill-based games does not survive the introduction of monetary stakes.

The Court further held that once wagering enters the picture, the nature of the underlying game ceases to be of relevance, and that activities falling within "betting and gambling" are res extra commercium, placing them entirely outside the protection guaranteed under Article 19(1)(g) of the Constitution of India. The test of proportionality, the Court held, does not arise where no fundamental right is available to begin with.

A Division Bench comprising  Justice J.B. Pardiwala and Justice R. Mahadevan observed, “The expression ‘betting and gambling’ cannot be split to mean that the staking angle alone would amount to betting whereas the risk angle or the chance element would amount to gamble. Both betting and gambling involve the aspect of staking money on an uncertainty. Merely because the risk element is commonly perceived as 'taking a chance', it cannot mean that an expression would cover only games of chances. The protection afforded to games of skill under Entry 34 cannot be construed as protection to betting on games of skill, which essentially becomes a gambling enterprise”.

“In terms of addiction, in terms of monetary losses and in terms of resultant widespread suicides respectively, online money gaming has a definite impact on the public. When such is the case, it has to be recognized that online money gaming has been disturbing the tranquility of the public by making betting and gambling more normalized and accessible. Therefore, public tranquility is breached and consequently, the States would have competence to invoke public order and seek to curb the mischief and restore public tranquility”, it noted further.

Senior Advocate Kapil Sibal, Amit Anand Tiwari, Sr. A.A.G., appeared for the appellants and Senior Advocates Dr. Abhishek Manu Singhvi, Arvind P. Datar, Aryama Sundaram, Mukul Rohatgi, Neeraj Kishan Kaul, Sajan Poovayya, Abhishek Malhotra appeared for the respondents.

For the background, the State of Tamil Nadu enacted the 2021 Tamil Nadu Amendment Act and thereafter the Tamil Nadu Online Gambling Act, 2022-23, expanding the definition of "gaming" to cover betting on games of skill including online rummy and poker.

The State of Karnataka similarly amended the Karnataka Police Act, 1963, in 2021. Both sets of legislations were challenged by online gaming companies. The Madras High Court and the Karnataka High Court struck them down, holding that games of substantial skill enjoy protection under Article 19(1)(g) and that Entry 34 is confined to games of chance. The States appealed to the Supreme Court.

The Court held that the protection historically afforded to games of skill under State gaming statutes, was a legislative choice and not a constitutional compulsion. The Court further held that the word "gaming" is not nomen juris it is a fluid statutory definition capable of alteration by the legislature and cannot be confined to games of chance alone.

“The expression ‘betting and gambling’ cannot be split to mean that the staking angle alone would amount to betting whereas the risk angle or the chance element would amount to gamble. Both betting and gambling involve the aspect of staking money on an uncertainty. Merely because the risk element is commonly perceived as ‘taking a chance’, it cannot mean that an expression would cover only games of chances”, the Bench observed.

“‘Betting and gambling’ are always associated with money or property in lieu of money (a ‘bet’ or ‘stake’). Even where games of skill are played, betting is an optional overlay, whereas games of pure chance cannot be played without a bet, indicating that the true test is whether the underlying activity is a game of skill or a game of chance, and not merely whether money is involved”, the Bench further observed.

On public order, the Court held that online money gaming, through addiction, financial ruin, and resultant suicides, has a proximate and direct nexus with public tranquility, sustaining the States' competence under Entry 1 of List II as well. The Tamil Nadu legislation was additionally found to be supported by empirical data from the Justice Chandru Committee report.

Pertinently, the Bench considered a detailed reference to the Constituent Assembly Debates on Entry 34 List II.

It observed, “What becomes clear from the above is that the founding Fathers of the Constitution clearly intended even Rummy, a Game of Skill, to be regulated and even be prohibited, when played with Stakes, by virtue of powers under the erstwhile Entry 45 before the Constituent Assembly and which is Entry 34 of List II at present in the 7th Schedule of the Constitution of India. A clearer intention of our makers of the Constitution cannot be derived from any other source. In fact, when one examines the discussion under Entry 45 that immediately followed the discussion under Entry 44, this position is only strengthened”.

“The finding in the impugned judgments that the expression ‘betting and gambling’ ought to be interpreted as ‘betting on gambling’ is a clear Constitutional aberration, tinkering with the Constitution or actually rewriting the Constitutional text which Courts are not legally entitled to do”, it, thus, noted.

Accordingly, the appeals of the States of Tamil Nadu and Karnataka were allowed and the impugned judgments of both High Courts were set aside.

Part II of the 2021 Tamil Nadu Amendment Act, Sections 2(i) and 2(l)(iv) and the Schedule to the Tamil Nadu Online Gambling Act 2022/23, and Sections 2, 3, 6, 8 and 9 of the 2021 Karnataka Amendment Act were declared intra vires the Constitution.

Cause Title: State Of Tamil Nadu & Ors. v. Junglee Games India Pvt. Ltd. & Ors. (Neutral Citation: 2026 INSC 594)

Appearances:

Appellants: Kapil Sibal, Sr. Adv., Amit Anand Tiwari, Sr. A.A.G., Sabarish Subramanian, AOR, Devyani Gupta, C Kranthi Kumar, Vishnu Unnikrishnan, Naman Dwivedi, Danish Saifi, Saishriya Havelia A, Tanvi Anand, V Keerthana, Advocates.

Respondents: Mukul Rohatgi, Sr. Adv., Sajan Poovayya, Sr. Adv., Sanjanthi Sajan Poovayya, Akhil Anand, AOR, Himanshu Vij, Durga Bose Gandham, Dr. Abhishek Manu Singhvi, Sr. Adv., Gopal Sankaranarayanan, Sr. Adv., Suhaan Mukerji, Abhishek Manchanda, Aditya Prakash, L Nidhiram Sharma, Sayandeep Pahari, Chandan Pandey, Tanya Shrivastav, Tanmay Sinha, Adv. M/S. Plr Chambers And Co., AOR, C. Aryama Sundaram, Sr. Adv., Pritha Srikumar Iyer, AOR, Sankeerth Vittal, Abhyudaya Shishodia, Zafar Inayat, Rohini Musa, Dhruv Garg, Advocates.

Click here to read/download the Judgment


Tags: