Internet Casinos Inc. (ICI), the world's first online casino, started operating from August 18, 1995, with 18 different games. Since then more than 1,400 websites, mostly domiciled in small Caribbean islands, have given rise to a business that grosses over $3 billion per year. Actually no business on the web earns more revenue than online gambling. Out from the estimated 14.5 million online gamblers, almost 30 per cent are from Asia.
A bet can be placed in minutes. Anyone with a credit card can set up an offshore currency account with a gambling site, leaving them free to place bets on sporting events like Wimbledon, cricket, horse racing and Formula One, or join a virtual casino to play slot machines, roulette, blackjack, poker etc. Companies like Flutter and Betmart accept bets on anything from who's likely to win the Nobel Prize to whether Madonna gets a divorce or not. Bets can range from a nickel to thousands of dollars and according to whether you win or lose the total amount is automatically adjusted to your account. The final balance may then either be mailed to you or left for future bets.
The law relating to online gambling in India needs to be understood within the country's socio-cultural context. At the outset, 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 traditional gaming centres as in lots of other countries, barring the state of Goa, the lottery business remains probably the most post popular type of gambling.
Though gambling isn't illegal, it is a highly controlled and regulated activity. Modern India is a quasi-federal Constitutional democracy and the powers to legislate are distributed at the federal along with 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 absolutely no single law governing gambling in the complete country. Different states have different laws governing gambling in addition to the laws with an application in the united states. Although 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 undertake the business enterprise of gambling and lotteries isn't considered as a fundamental right protected by the Constitution of India. It may however be pointed out that hawaii government run lotteries make significant contributions to hawaii exchequer of several state governments and the Union government, and therefore there is a resistance to perform prohibition.
The next 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 within their respective jurisdictions. The penal legislations in respective states have already been amended in accordance with their policy on gambling. However, this legislation does not have any direct impact on online gambling unless a wide interpretation is directed at this is of common gaming house so as to include virtual forums as well.
The Indian Contract Act, 1872 (ICA)
The ICA is really a codified umbrella legislation that governs all commercial contracts in India. Beneath the ICA, a wagering contract may be the one which can't 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 consequence of any game or other uncertain event on which any wager is made'. Gambling, lottery and prize games have held to be wagering contracts and therefore 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 cause of 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 also prohibit lotteries of their territorial jurisdiction. This Act also provides for the manner in which the lotteries should be conducted and prescribes punishment in case of breach of its provision. Lotteries not authorized by hawaii 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 handles 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, will be punished with imprisonment of either description for a term which might extend to half a year, or with fine, or with both.
And whoever publishes any proposal to pay any sum, or even to deliver any goods, or even to do or forbear doing anything for the benefit of any person, on any event or contingency relative or applicable to the drawing of any ticket, lot, number or figure in any such lottery, will be punished with fine which might extend to one thousand rupees.
Internet gambling
The law related to gambling is also applicable to online gambling. All gambling contracts are considered to be wagering contracts and it is extremely hard to enforce such contracts beneath the ICA, detailed above.
As pointed out earlier, the web lottery is the most popular form 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 us that banned lotteries. In many instances, these marketers and distributors limit their online services to consumers that are residents of the states where a lottery is permissible. Notwithstanding the actual fact there has been no reported case of breach by any business promoting online lotteries, most of these companies (as a safeguard) seek an undertaking from their consumers relating to their residence.
There have been instances where one state has banned the lottery of other states, including online lotteries. In a recent 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 all other states, including online lotteries under the Lotteries (Regulation) Act 1998. The state government, in cases like this, 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 could be problematic 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 be worried 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. Due to this fact, a gambling website hosted outside India aiming at receiving money from within India cannot do so through legal channels.
View website gambling remains an extremely regulated sector with seemingly limited horizons to grow. While the present regulatory framework helps it be difficult for offshore gambling websites to focus on 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.