SC notice to online gaming industry body on K'taka's appeal against quashing of ban

The Supreme Court on Friday decided to examine a plea by the Karnataka government against the High Court's division bench judgement of February 14, which struck down provisions of law prohibiting betting and wagering in online games.

A bench of Justices S Abdul Nazeer and V Ramasubramanian issued notice to online gaming industry body All India Gaming Federation and skill-based gaming firms and on the plea by the state government and another person.

The court ordered to post the matter along with a similar plea by the Tamil Nadu government against the Madras High Court judgement.

Senior advocates Mukul Rohatgi, Shyam Divan and A M Singhvi represented the gaming companies associations.

They said the issue was whether it was game of skill or chance or gambling. The counsel said the court may issue notice and tag along with pending matter.

In its appeal, the Karnataka government said a law against online gaming is needed to maintain public order as cyber crime had reached epic proportions with filing of 28,000 cases in the last three years.

Defending its decision, the state government also pointed out several people have committed suicide and families have been ruined due to online gaming.

“Therefore, the Karnataka Police (Amendment) Act, 2021 made criminalised wagering, betting or risking money on the unknown result of an event. It was specifically required suitably deal with the evolving situation arising from the ill effects of online gambling," the plea by the state government said.

The Karnataka High Court had on February 14, 2022 quashed the state government's ban and the legal provision which criminalised betting and playing games of skill, including online games.

It had declared the 2021 Amendment Act as unconstitutional, saying there cannot be any ban on online games of skill.

It had also restrained the state enforcement agencies from interfering with the online gaming business and allied activities. However, it said that nothing in its judgment shall be construed to prevent an appropriate legislation being brought about the subject betting and gambling in line with the Constitution.

In its appeal, the Karnataka government said the High Court had grossly erred in not taking into account the material produced by the state government with regard to cases registered by the police authorities, the manner in which various websites were misleading and exploiting the general public to part with huge money etc.

"The High Court also gravely failed to note the fact that beting or wagering on horse racing conducted only on the race track shall be permissible under the Karnataka Act, wherein the interference by authorities would effectively regulate the same, unlike the situation in online platforms," it claimed.