Madras High Court has upheld the Tamil Nadu Prohibition of Online Gambling and Regulation of Online Games Act, 2022, while making a clear distinction between games of chance and games of skill. The decision, delivered by a Bench consisting of Chief Justice SV Gangapurwala and Justice PD Audikesavalu, clarified that the Act’s prohibitory provisions will only be applicable to games of chance, not to games of skill like Rummy and Poker.
Takeaways from the High Court’s decision
Clear Distinction Between Skill and Chance:
The Madras High Court has made a clear distinction between games of skill and games of chance. It emphasized that while the State government has the authority to regulate online games, it can only ban games of chance. Games that involve skill, such as Rummy and Poker, cannot be prohibited under this Act.
Empowering the State:
The ruling acknowledges the state’s power to enact legislation to prohibit online gambling and to regulate online games of skill. It emphasizes that the State of Tamil Nadu has the authority to set rules to restrict the time individuals spend playing online games and establish age limits for both types of games.
Excessive Ban on Games of Skill:
The High Court pointed out that instead of regulating online games of skill, the state chose to prohibit them outright, which was deemed as an overreach of its legislative competence. This decision highlights the importance of striking a balance between regulation and prohibition in the gaming industry.
The All India Gaming Federation and the online gaming companies that challenged the Act have found support in this ruling, and it is expected to shape future discussions and legal developments in the rapidly evolving online gaming landscape in India.