Justice Vinod Diwakar, Allahabad High Court
Allahabad High Court Directs UP Government To Form High-Powered Panel On Online Gaming Regulation
|Two individuals accused of running an online betting racket from their Agra residence sought quashing of charges under the Public Gambling Act, 1867.
The Allahabad High Court has directed the Uttar Pradesh Government to establish a High-Powered Committee to examine the need for a dedicated law to regulate and monitor the rapidly growing domain of online gaming and betting.
The judgment came while the Court was hearing a petition filed by two individuals accused of running an online betting racket from their residence in Agra, allegedly earning crores and encouraging local residents to gamble away their income. The petitioners sought to quash the charges and ongoing trial proceedings under the Public Gambling Act, 1867.
A Bench of Justice Vinod Diwakar emphasized the necessity of formulating legislation tailored to address the evolving nature of digital gaming and betting platforms. The Court took suo motu cognizance of the broader implications of online gambling while adjudicating a specific petition related to the Public Gambling Act, 1867.
The High Court ordered that the committee be headed by Professor KV Raju, who serves as the Economic Advisor to the Government of Uttar Pradesh. The Principal Secretary of State Tax will act as the Member Secretary of the panel. The committee will also include other domain experts to provide a multidisciplinary perspective on the matter.
The Court instructed that the collective inputs from this expert body should be utilized to draft a comprehensive legislative framework aimed at effectively regulating and monitoring online gaming and public betting.
The Court said, “The Public Gambling Act is a pre-digital law. It makes no mention of digital platforms, servers, or cross-border transactions. Its enforcement is limited to physical gambling houses and has no jurisdiction over virtual gambling environments accessed via mobile phones, computers, or offshore servers.”
The Court added, “Fantasy sports in India lie in a legal grey area, straddling the line between games of skill (permitted) and games of chance (prohibited under the Public Gambling Act, 1867). Multiple High Court rulings — notably in Punjab and Haryana, Rajasthan, and Bombay — have recognized fantasy sports as a game of skill, thereby legitimizing platforms under Article 19(1)(g) of the Constitution of India -right to practice any profession.”
It was further observed that multiple High Courts including those in Punjab and Haryana, Rajasthan, and Bombay have recognized fantasy sports as games of skill, thereby extending them constitutional protection under Article 19(1)(g) (right to practice any profession). However, this classification remains contested and jurisdiction-dependent.
The Court also drew attention to the mental health and social risks associated with online gaming, particularly among adolescents and young adults. It flagged several negative outcomes, including gaming addiction, anxiety and depression, disruption of sleep patterns, Academic decline and social withdrawal.
It criticized gaming platforms for using manipulative algorithms and reward systems that promote compulsive engagement.
The Court expressed concern about the fact that many online gambling platforms operate from outside India, with servers located overseas and transactions routed through unregulated financial channels. This, the Court warned, complicates law enforcement and raises risks related to money laundering, financial fraud, terror financing.
In light of the above, the Court emphasized, “Till a robust legislative framework is enacted, recognizing the digital nature of gaming and imposing clear regulatory safeguards, the fines and imprisonment terms may be revised in line with inflation and the scale of operations in Uttar Pradesh by bringing necessary amendments in the existing law, thereby making the offence non-cognizable.”
The Court ruled that the accused were charged under a non-cognizable offence, for which police action without prior magistrate approval was procedurally incorrect. Consequently, it quashed the ongoing proceedings.
However, it gave the police liberty to initiate a fresh investigation, provided they follow due legal procedures.
Cause Title: Imran Khan & Anr. v. State of U.P. & Anr., [2025:AHC:78538]
Appearance:
Applicant: Advocates Rajiv Lochan Shukla, Diwan Saifullah Khan
Respondent: Advocate HP Singh