Lockdown Leaves Important Cases on Skill Gaming Legality in Limbo
The nationwide lockdown imposed by the central government to curtail the spread of COVID-19 has resulted in an almost complete standstill on court hearings in the country, except crucial and urgent ones.
This will inevitably result in a delay of at least one more year for many important matters where the High Courts and Supreme Court will decide the fate of the Indian skill gaming industry.
Here are some of the key legal matters pending before various courts in India that will decide the continuance of many online skill gaming businesses:
1) Dream11 legality and GST evasion case in Supreme Court
A three-judge bench of the Supreme Court on March 6, 2020, stayed the operation of an April 2019 judgment by the Bombay High Court that ruled fantasy sports a game of skill and outside the ambit of gambling. The case also absolved Dream11 of GST evasion charges.
But with the Supreme Court issuing notice to the Maharashtra and central governments, the issue of whether playing fantasy sports is a game of skill or chance will be heard in depth by the apex court.
It will also rule on whether GST has to be paid on the total entry fees of each contest or the platform fee retained by the company.
The government has alleged that Dream11 and other online gaming companies are evading thousands of crores of revenue. The industry denies this charge.
The high stakes matter was set for a hearing in April 2020 and would have brought clarity on the legal and tax aspects of online gaming.
However, this matter is unlikely to be heard in the next few months.
2) Sports betting legality case in Supreme Court
A Public Interest Litigation (PIL) filed by Delhi-resident Geeta Rani, asking for directions to the central government to regulate online sports betting, in line with the Lodha committee report recommendations has been pending in the apex court since 2017.
The Supreme Court had tagged the matter along with petitions filed by the Board of Control for Cricket in India (BCCI) and state cricket associations on implementation of Lodha committee reforms.
Since the larger BCCI matter has several connected applications and issues to be dealt with, Rani’s plea has not been afforded a full hearing. It is likely that the petition will remain waiting, even after the court resumes full-fledged functioning.
3) Gujarat HC poker hearing
The Gujarat High Court has not substantially heard a letters patent appeal filed by Indian Poker Association Secretary KN Suresh, Hotel Ramada, Dominance Games, and others, against an adverse single bench judgment of the court. This judgement will rule on holding poker to be a game of chance and within the ambit of gambling.
On February 19, 2020, a division bench of the court comprising of Chief Justice Vikram Nath and Justice AJ Shastri had once again adjourned the appeal to May 5, 2020. This was to be listed before a bench of Justices NV Anjaria and Ashok Kumar Joshi.
Expect a final judgment in 2021 or even 2022.
4) Telangana Government’s Gaming Amendment challenge by online rummy operators
A clutch of writ petitions filed by rummy companies such as Ace2Three, RummyCircle and Junglee Rummy in the Telangana High Court challenging the state government's decision to amend the Telangana Gaming Act to include online gaming, and games of skill, within the ambit of the penal provisions of law, has been pending since June 2017.
The matters have not seen much movement since November 2018 as the court did not prioritise them. It is unlikely to have this on their list of priorities when things are back up and running.
Consequently, clarity on the legality of online rummy and games of skill in the state of Telangana will have to wait for another couple of years at least.
