Last month, the Karnataka legislature passed a legislation to amend the Karnataka Police Act, 1963, making all forms of gambling, including online, a cognisable and non-bailable offence.

Gambling Law

• The Karnataka Police (Amendment) Act, 2021 was notified and came into force.
• It is aimed for broadening the scope of gambling beyond what has been defined by law.
• It was passed despite similar laws introduced in Tamil Nadu, Kerala and Telangana having faced legal challenges.

What forms of gambling does the new law cover?

• The amended law covers all forms of wagering or betting “in connection with any game of chance” with the exception of horse racing and lotteries.
• It also puts betting on the skills of others in the category of gambling.
• It provides an exception only to any pure game of skill and not to “wagering by persons taking part in such game of skill”.

Penalties prescribed

• It enhances maximum punishment for owners of gambling centres from one year to three years of imprisonment and fines from Rs 1,000 to Rs 1 lakh.
• The minimum punishment proposed is six months instead of the current one month and the fine is Rs 10,000 instead of Rs 500.

Implications of the law

• Since the new law came into effect, several online gaming firms have geo-locked their apps and sites in Karnataka to prevent attracting police action if customers access the sites.

Legal issues raised by the amended laws

One of the primary grounds on which the new gaming laws in these states has been challenged is:

• Games of skill: This been clubbed along with games of chance in the definition of gaming, if the games of skill are played for prizes or bets.
• Violation of FR: Gaming companies have argued — successfully that competitive games of skill are business activities protected under Article 19 (1) (g) of the Constitution.
• Other examples: Rummy and horse racing have been classified by the courts as games of skill that do not come under the purview of gaming laws.
• Competence of the state: It has been argued that states do not have “legislative competence” to prohibit games of skill and that only games of chance can be regulated for gambling and betting.

Why has Karnataka amended the law?

• Ban on online gambling: The statement of objects and reasons justify that the new law is needed to make gambling a cognisable and non-bailable offence (gambling in public streets remains cognisable and bailable).
• More power to Police: Other reasons cited is that police cannot raid gambling dens without a formal written order from a magistrate, since gambling is a non-cognisable and bailable offence.
• Public demands for ban: Recent public interest litigations seeking a ban on online gaming and betting, too, have been a trigger for the amendments.
• Illicit use of cyber-space: The new law has also been introduced to include the use of cyberspace as defined in the IT Act 2000 to curb the menace of gaming through internet.

Will these amendments stand the test of law?

• As mentioned, a similar law in Tamil Nadu was struck down by the Madras High Court as being ultra vires after it was challenged by online gaming firms.
• The court ruled that- Games and sporting activities in the physical form cannot be equated with games conducted in virtual mode or in cyberspace.
• However, when it comes to card games or board games such as chess or Scrabble, there is no distinction between the skill involved in the physical form of the activity or in the virtual form.
• The HC said both rummy and poker are games of skill.

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