7 May 2013

Exclusive: How Maharashtra tried opening casinos two decades before any other state and passed historic legislation during emergency


Exclusive Digging through the archives in the Maharashtra Law & Judiciary Department it has been found out that the state legislative assembly of Maharashtra passed a historic and visionary piece of legislation in 1976; during the height of national emergency. The Maharashtra legislative assembly had passed The Maharashtra Casinos (Control & Tax) Act, 1976 receiving the assent of the Governor on 19th July of that year as per a gazetted copy available through the government.

While it is unclear as to what prompted the state government to pass such a landmark and progressive Bill in 1976 (one possible reason could be to curb criminal activities and black money associated with gambling dens run by the underworld) when the country was in a state of national emergency and civil liberties were severely curtailed (probably without any political, social or religious opposition due to the clampdown imposed during the period); but it has been confirmed that Maharashtra Congress-led government under the leadership of Chief Minister Shankarrao Chavan enabled passage of this historic legislation that allowed state government to grant licenses for all casinos in specified areas on payment of fees.

Casino games have been defined to mean any games of chance including betting activities. Further, the state government has been authorised to tax up to twenty-five percent (25% ) of the amount wagered in casinos as tax from the owners and the Act was to override provisions of the Bombay Prevention of Gambling Act, 1887 (which imposes a blanket ban on gambling and betting except lotteries and betting on horse-races).

All endeavours are being made to obtain more information on the Act and any plans/proposals after that but a 1976 judgment of the Gujarat High Court in Balubhai Amidas Khrishti v. State of Gujarat, (1978) 19 GLR 535 (the decision was on disciplinary action for offences of moral turpitude) indicates that the legislative assembly has passed the Act after deliberation and was in the process of allowing casinos. Following was the observation of the court:

“Latest development in this behalf was brought to the notice of the Court by Mr. Abichandani who has brought daily issue of time of india (sic) dated 2nd July 1976 which carries a news item that the Maharashtra Government has decided to license casinos in the State and impose tax on the money staked on the games in casinos. Now, gambling is permitted in casinos.

Maharashtra Government has not only gone to set up casinos but it is being done with a view to channelising gambling instinct of the human being so that they may not be victims of some perfidious element. That is however, neither here nor there because even if the casino is set up by the Maharashtra Government it permits gambling none-the-less. In fact I was informed that a regular bill for licensing casinos is already introduced in the Maharashtra State Assembly. I am not merely relying upon the newspaper item. I am on much firmer ground when I say that Maharasthra Government which is described as forward looking progressive Government which has completely relaxed prohibition and is now going to permit gambling by licensing casinos under its aegis…”

Should Matheran have casinos?

It is unclear what later transpired after which no casino has opened in Maharashtra and Goa was the first Indian state to amend their legislation to allow casinos in the year 1996.

The one essential requirement under the Maharashtra Casinos (Control & Tax) Act, 1976 has somehow not yet been fulfilled though records indicate that the Act has been passed and is in force in the state as of now. Section 1(3) of the Act states that “it (the Act) shall come into force such date as the State government may by notification in the Official Gazette appoint.”

No such notification has been issued by the government till date and hence this Act remains buried in the archives and will remain infructuous and of academic importance till there is enough political will and the executive government of the day summons the courage to pass an appropriate notification and draft rules giving effect to provisions of the Act. It is not easy to speculate reasons for not issuing the notification and efforts are on to procure necessary information from the government departments.

However there were various proposals in the past 37-odd years after passage of this landmark legislation to open casinos in the state. In 2003, entrepreneur Vikram Mittal of Lotelier Group discussed a proposal with government officials to start a casino in Raigad district of Maharashtra but there was no progress in the matter, possibly due to political and other opposition.

Further, in 2012, the Maharashtra Tourism Development Corporation (MTDC) and other government bodies brought forward a proposal to allow casinos in the hill-station of Matheran to give a boost to tourism in the region. However, later MTDC officials backtracked from the proposal citing ecological roadblocks and possible denial of permission by the Union Ministry of Environment & Forests (MoEF).

There is news through media sources that Maharashtra government may again consider proposals to allow casinos in the state- which can either be done through a notification under The Maharashtra Casinos (Control & Tax) Act, 1976 or for promotion of a tribal area under Schedule V of the Constitution. However, the decision to allow casinos is entirely political and will only be done when appropriate pressure is applied to the government and strong reasons are given for notifying the Act or passing suitable amendments. One only hopes that the 37-year old Casino Act is notified and cash-starved Maharashtra does not miss an opportunity to earn valuable revenue and grow as a tourist destination like neighbouring Goa.

Note: A copy of The Maharashtra Casinos (Control & Tax) Act, 1976 is available on the Bombay High Court website here.

Update: The records in the Law and Home Departments of the government of Maharashtra indicate that the Act is still in force but no notification giving effect to the Act has been issued. The Statement of Objects and Reasons of the Act indicate that it was passed to earn revenues from casinos and promote Maharashtra as a tourism destination especially for foreign tourists.

Records of legislative proceedings also indicate that there was opposition to the Bill from the Muslim league leader and MLA GM Banatwala who opposed allowing casinos and betting, moved various amendments (which were negatived) and termed gambling as an inevitable vice which should be strictly regulated.

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