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A Karnataka High Court bench of Chief Justice Ritu Raj Awasthi and Justice Krishna Dixit today held that  Karnataka Police (Amendment) Act 2021, which banned all online gambling as unconstitutional and ultra vires. The bench however made it clear that the State can bring in an appropriate legislation banning online gambling when it is appropriate.

A batch of petitions challenging the legality and validity of the new Karnataka Police (Amendment) Act, 2021.
Stating that the new amendment is a social legislation, Advocate General Prabhuling Navadgi said that the object of the enactment is to prohibit activity which is injurious to public health and order.Navadgi also clarified that the State does not intend to ban games of skill. 

Navadgi also informed the Court that the state has the legislative competence to enact such a law. And tremendous effort including research as been undertaken by the Authorities before the Act was drafted and enacted. 

During the hearing, Mukul Rohatgi, Senior Advocate, appearing for Dream 11 referred to a report by NITI Aaayog and submitted that the the think tank strongly recommends that online gaming should be promoted. He submitted that what participants in the games of Dream 11 do no just win or lose blindly and that it involves the use of skills to study the selection of players.

He further submitted that the Charter of Federation lays down rules about how a game is played and these rules constitute a game of skill and not gambling or betting. Rohatgi submitted that Dream 11 maintains strict guidelines and does not stand to relegate who may or may not follow the charter.

Rohatgi further referred to NITI Aayog’s report and submitted that each State should not put obstacles on the industry but should create a favourable environment, he submitted that this law by Government of Karnataka creates an obstacle to the industry. He submitted that while the industry is proper there maybe a few people misusing it, however the entire industry should not be banned because of the doings of a few people.

Rohatgi concluded his arguments by bringing to the notice of the court that it is not open to the States to makes laws contrary to the judgments of various courts which would affect Dream 11’s business activity.

Prabhuling Navadgi, Advocate General of Karnataka, in reply to Rohatgi submitted that he finds it strange that such a petition is filed in the first place. He submitted that State has not initiated any action against the All India Gaming Federation. He further submitted that action initiated if any is in consonance with the act and not independent of it.

The AG further questioned as to whether a court can decide a particular game is a game of skill or not in its writ jurisdiction. Navadgi submitted that the contention of the petitioners that fantasy sports is a game of skill will depend on the facts of each case and cannot be decided in a writ petitioner.

Navadgi further argued that while the petitioners say that fantasy sports is a game of skills, his contention is that it does not matter whether it is a game of skill or not if there is a wager involved. He further submitted that betting on an unknown result amounts to an offence.

The AG while referring to betting in cricket submitted that it was a big menace and lead to circulation of money. It however also lead to spoiling the purity of the game and hence strict action must be taken to prevent any such outcomes. It was argued that today the Indian team is selected by a group of experts hence there is no question of using a person’s expertise to select a player and form his own team.

The court at this point questioned the AG if it was open to them to determine whether it s a game of skill or not as many High Courts have already considered the same question. The AG replied saying it is open for the Karnataka High Court to determine the question as this High Court views can be followed by other courts.

The AG on the NITI Aayog report submitted that the report does not substitute the view of the legislature and it stands on its own. Navadgi concluded his arguments by reading Entry 34 of the State list and quoted Dr.Ambedkar saying “I put this entry so that the States Prohibit it.”

The AG submitted that the petitions deserve to be dismissed as no action has been initiated against the petitioners.

(To be updated after the order is uploaded)

Case title: All India Gaming Federation Vs State of Karnataka