Internet Casinos Inc. (ICI), the world's first online casino, started operating from August 18, 1995, with 18 different games. Since that time a lot more than 1,400 websites, mostly domiciled in small Caribbean islands, have given rise to an industry that grosses over $3 billion a year. Actually no business on the net earns more revenue than online gambling. Out of your estimated 14.5 million online gamblers, almost 30 % are from Asia.
A bet can be put into minutes. Anyone with a credit card can setup an offshore currency account with a gambling site, leaving them free to place bets on sports like Wimbledon, cricket, horse racing and Formula One, or join a virtual casino to play slots, roulette, blackjack, poker etc. Companies like Flutter and Betmart accept bets on anything from who's going to win the Nobel Prize to whether Madonna gets a divorce or not. Bets can range between a nickel to thousands and in accordance with whether you win or lose the total amount is automatically adjusted back. The final balance may then either be mailed for you or left for future bets.
The law associated with online gambling in India needs to be understood within the country's socio-cultural context. First, gambling, although not absolutely prohibited in India, does not receive express encouragement by policy makers. The Indian organized gambling industry is estimated to be worth around US$8 billion. While stringent laws have checked the proliferation of casinos and high street gaming centres as in lots of other countries, barring the state of Goa, the lottery business remains the most post popular type of gambling.
Though gambling is not illegal, it is a highly controlled and regulated activity. Modern India is really a quasi-federal Constitutional democracy and the powers to legislate are distributed at the federal in addition to the state levels. Gambling features in List II of the Constitution of India, therefore that hawaii governments have the authority to enact laws in order to regulate gambling in the respective states. Thus, there is no single law governing gambling in the entire country. Different states have different laws governing gambling in addition to the laws that have an application across the country. While some states have banned lotteries, other states allow state government lotteries marketed and distributed in other lottery playing and promoting states through private entities.
Regulation of gambling
The courts have defined gambling as 'the payment of a cost for to be able to win a prize'. The dominant component of skill or chance shall determine the nature of the game. A casino game could be deemed to be gambling if the part of chance or luck predominates in deciding its outcome. As a result, Indian courts have held that betting on horse racing and a few card games are not gambling. The right to attempt the business enterprise of gambling and lotteries is not considered as a simple right protected by the Constitution of India. It could however be pointed out that the state government run lotteries make significant contributions to hawaii exchequer of several state governments and the Union government, and hence you will find a resistance to complete prohibition.
The following legislation is pertinent to gambling:
The Public Gaming Act, 1867
This Act provides punishment for public gambling and for keeping of a 'common gaming house'. This Act also authorises the state governments to enact laws to regulate public gambling in their respective jurisdictions. The penal legislations in respective states have already been amended relative to their policy on gambling. However, this legislation doesn't have any direct impact on online gambling unless a wide interpretation is directed at this is of common gaming house to be able to include virtual forums aswell.
The Indian Contract Act, 1872 (ICA)
The ICA is really a codified umbrella legislation that governs all commercial contracts in India. Under the ICA, a wagering contract is the one which cannot be enforced. The Act lays down; 'Agreements by way of wager are void, and no suit will be brought for recovering anything purported to be won on any wager or entrusted to any person to abide by the result of any game or other uncertain event which any wager is made'. Gambling, Cược chấp châu Á and prize games have held to be wagering contracts and thus void and unenforceable. While a wagering contract is not illegal, it cannot be enforced in a court of law. Thus, the courts won't entertain any reason behind action that arises out of a wagering contract.
Lotteries (Regulation) Act, 1998
This Act provides a framework for organizing lotteries in the united kingdom. Under this Act, hawaii governments have already been authorized to promote and prohibit lotteries within their territorial jurisdiction. This Act also offers the manner where the lotteries should be conducted and prescribes punishment in case of breach of its provision. Lotteries not authorized by the state have already been made an offence under the Indian Penal Code. Several non-lottery playing states, like Gujarat and Uttar Pradesh, have prohibited the sale of other state-government lotteries under this Act.
Indian Penal Code, 1860
Section 294A deals with keeping lottery office. It says that whoever keeps any office or place for the intended purpose of drawing any lottery not being truly a State lottery or a lottery authorised by hawaii Government, shall be punished with imprisonment of either description for a term which may extend to half a year, or with fine, or with both.
And whoever publishes any proposal to cover any sum, or even to deliver any goods, or even to do or forbear doing anything for the advantage of anybody, on any event or contingency relative or applicable to the drawing of any ticket, lot, number or figure in any such lottery, shall be punished with fine which may extend to one thousand rupees.
Internet gambling
The law related to gambling is also applicable to online gambling. All gambling contracts are believed to be wagering contracts in fact it is extremely hard to enforce such contracts beneath the ICA, detailed above.
As pointed out earlier, the web lottery is the most popular type of internet gambling in India. Most companies marketing and distributing or conducting state government-sponsored lotteries through the web are not permitted to sell their services in the states that banned lotteries. Normally, these marketers and distributors limit their online services to consumers who are residents of the states where a lottery is permissible. Notwithstanding the actual fact there has been no reported case of breach by any company promoting online lotteries, most of these companies (as a safeguard) seek an undertaking from their consumers associated with their residence.
There have been instances where one state has banned the lottery of other states, including online lotteries. In a recently available case, the Karnatka High Court upheld your choice of the Karnataka government to create itself a 'lottery free zone' by imposing a ban on lotteries of most other states, including online lotteries beneath the Lotteries (Regulation) Act 1998. Hawaii government, in this instance, directed the closure of the terminals and kiosks selling the web lotteries.
Enforcement over foreign jurisdictions
If the websites are hosted and operated from outside India, it can be difficult for the Indian authorities to issue any directive to close them down or prohibit their access without needing its blocking powers beneath the ITA. The authorities have little to worry about, as Indian forex laws usually do not permit remittances outside India for gambling related activity, including the purchase of lottery tickets, football pools and sweepstakes. Because of this, a gambling website hosted outside India aiming at receiving money from within India cannot do so through legal channels.
Conclusion
Online gambling remains a highly regulated sector with seemingly limited horizons to cultivate. As the present regulatory framework makes it problematic for offshore gambling websites to target customers in India, the India-based companies can only just distribute and market state-government lotteries online in permitted territories. The pervasive authority with the federal government to block gambling related websites and the impossibility of enforcing gambling-related contracts further discourage the prospects for the industry.