The State Of Tamil Nadu vs Junglee Games India Private Limited
- Court
- Supreme Court
2026 INSC 594
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. 6124-6131 OF 2023
STATE OF TAMIL NADU & ORS. …APPELLANTS
VERSUS
JUNGLEE GAMES INDIA PVT. LTD. & ORS. ...RESPONDENTS
WITH
CIVIL APPEAL NOS. 8275 – 8279 OF 2026
(ARISING OUT OF SLP(C) NOS. 1588-1592 OF 2024)
WITH
C.A. NOS. 6132 - 6143 OF 2023
WITH
C.A. NO. 6144 OF 2023
J U D G M E N T
Signature Not Verified
Digitally signed by
CHANDRESH
Date: 2026.05.29
17:27:21 IST
Reason:
J. B. PARDIWALA AND R. MAHADEVAN, JJ.
For the convenience of exposition, this judgment is divided into the
following parts:
INDEX
A. FACTUAL MATRIX ........................................................ 3
i. Legislative framework in Tamil Nadu ..................................... 4
ii. Legal Consequences of the 2021 TN Amendment Act ............ 8
iii. Findings of the High Court of Madras in Junglee Games ...... 9
iv. Legislative framework of the 1963 Police Act ...................... 12
v. Legal consequences of the 2021 Karnataka Amendment Act 19
vi. Findings of the High Court of Karnataka in AIGF ( supra ) .... 22
B. SUBMISSIONS ON BEHALF OF THE STATE OF TAMIL
NADU ......................................................................... 24
C. SUBMISSIONS ON BEHALF OF THE STATE OF
KARNATAKA .............................................................. 33
D. SUBMISSIONS ON BEHALF OF THE GAMING COMPANIES
IN THE TAMIL NADU AND KARNATAKA AMENDMENT
GAMING BATCH ......................................................... 40
E. SUMMARY OF THE SUBMISSIONS CANVASSED ON
BEHALF OF THE RESPONDENTS ................................ 79
F. ISSUES FOR CONSIDERATION .................................... 90
G. ANALYSIS ................................................................... 92
I. Scope of Entry 34 in List II of the Seventh Schedule to the
Constitution ............................................................... 92
II. Constituent Assembly Debates on Entry 34 List II ....... 95
CA Nos. 6124-6131 of 2023 & Connected Matters Page 1 of 269
III. Entries in the Seventh Schedule must receive broad and
liberal interpretation ................................................ 102
IV. The decisions in RMDC-I ( supra ), RMDC-II ( supra ) and K.R.
Lakshmanan ( supra ) respectively ............................ 106
V. Online Gaming Companies’ Interpretation of RMDC-II 157
VI. The impugned legislations do not suffer from manifest
arbitrariness ............................................................. 160
VII. The impugned legislations are not disproportionate 175
VIII. On Nomen Juris and Legal Fiction .......................... 184
IX. The State Legislature also derives competence from the
Entry 1 List II, that is, “public order” ....................... 194
a. Contours of the Expression “Public Order” ....................................... 195
b. Detriment to tranquility, health, and comfort ................................... 195
c. Public Safety or Interest ................................................................... 202
d. Even Tempo of the Life of the Community, Potentiality Test ............. 209
e. “Concentric Circles” Doctrine ........................................................... 220
f. Social and Economic Disorder........................................................... 226
g. Proximate Nexus Requirement ......................................................... 234
h. Public Order in the Age of Internet, Computer, and Cyber Laws....... 242
i. Ingredients of Public Order Culled Out ............................................. 251
H. CONCLUSION ............................................................ 262
CA Nos. 6124-6131 of 2023 & Connected Matters Page 2 of 269
1. Leave granted.
2. Since the issues involved in all the captioned appeals are the
same those were taken up for hearing analogously and are
being disposed of by this common judgment and order.
A. FACTUAL MATRIX
C.A. NOS. 6124-6131 OF 2023 @ SLP(C) NOS. 19981-
19987 OF 2021 (STATE OF TAMIL NADU & ORS. vs.
JUNGLEE GAMES INDIA PVT. LTD. & ORS.) AND CIVIL
APPEAL NOS. 8275 – 8279 OF 2026 OF 2026 @ SLP(C)
NOS. 1588-1592 OF 2024 (STATE OF TAMIL NADU &
ORS. vs ALL INDIA GAMING FEDERATION & ORS.)
3. The aforesaid appeals, i.e., C.A. Nos. 6124-6131 of 2023,
arise from the judgment and order passed by the High Court
of Madras dated 03.08.2021 in WP No. 18022 of 2020, WP
NO. 18029 OF 2020, WP NO. 18044 OF 2020, WP NO.
19374 OF 2020, WP NO. 19380 OF 2020, WP NO.7354
OF 2021, WP NO. 7356 OF 2021, WP NO. 13870 OF 2021
by which the High Court struck down Part II of the Tamil
Nadu Gaming and Police Laws (Amendment) Act, 2021 (for
short, “ the 2021 TN Amendment Act ”) as ultra vires on the
ground that “betting” under Entry 34 List II cannot be
CA Nos. 6124-6131 of 2023 & Connected Matters Page 3 of 269
divorced from “gambling”. In other words, the High Court
took the view that the words “betting” and “gambling” should
be read conjunctively.
4. SLP(C) Nos. 1588-1592 of 2024 are directed against the
impugned judgment and order passed by the High Court of
Madras dated 09.11.2023 in WP No. 13203 of 2023, WP No.
13593 of 2023, WP No. 13720 of 2023, WP No. 13722 of
2023, WP No. 14704 of 2023, by which the High Court:
a) Struck down the Schedule to the Tamil Nadu Prohibition
of Online Gambling and Regulation of Online Gaming
Act, 2022/2023 (“ the TN Online Gambling Act
2022/23 ”), including poker and rummy as prohibited
games of chance; and
b) Read down Sections 2(i) and 2(l)(iv) to exclude rummy
and poker from “online games of chance”.
i. Legislative framework in Tamil Nadu
5. The State of Tamil Nadu enacted the 2021 TN Amendment
Act, which amended the Tamil Nadu Gaming Act, 1930
(hereinafter, “ the 1930 Gaming Act ”). The 2021 TN
Amendment Act was introduced in order to curb the growing
menace of online betting and gambling and also to hinder
CA Nos. 6124-6131 of 2023 & Connected Matters Page 4 of 269
the rise of virtual gambling houses, for which there was no
regulation under the 1930 Gaming Act.
6. Paragraph 1 of the Statement of Objects and Reasons for
enacting the 2021 TN Amendment Act is reproduced
hereunder:
“Gaming by means of cards, dice etc. in the form of
betting or wagering has been banned in the cities of
Chennai, Madurai, Coimbatore, Salem, Tiruchirapalli
and Tirunelveli by the Chennai City Police Act, 1888
(Tamil Nadu Act III of 1888) read with Tamil Nadu Act
32 of 1987 and Tamil Nadu Act 51 of 1997 and in the
rest of the State by the Tamil Nadu Gaming Act, 1930
(Tamil Nadu Act III of 1930). Playing games like
Rummy, Poker etc, using computers or mobile phones,
for money or other stakes, which are addictive in
nature, had developed manifold, in the recent times. As
a result, innocent people got cheated and incidents of
suicide were reported. In order to prevent such
incidents of suicide and protect innocent people from
the evils of online gaming, it was decided to ban
wagering or betting in cyber space by suitably
amending the relevant enactments. Therefore, the
Government decided to amend the Tamil Nadu Gaming
Act, 1930 (Tamil Nadu Act III of 1930) and to extend its
application throughout the State and to make
consequential amendments to the Chennai City Police
Act, 1888 (Tamil Nadu Act III of 1888) and the Tamil
Nadu District Police Act, 1859 (Central Act XXIV of
1859).”
(Emphasis Supplied)
7. The 2021 TN Amendment Act introduced a few modifications
to the 1930 Gaming Act in order to prohibit online betting
and gambling activities. The modifications are as follows:
CA Nos. 6124-6131 of 2023 & Connected Matters Page 5 of 269
a) Section 3(b), which defined gaming, was amended to
include all forms of betting or wagering on any game
played, even in cyberspace, using electronic transfer of
funds. The provision is reproduced hereunder:
“(b) “gaming” does not include a lottery, but
includes any game involving wagering or betting in
person or in cyber space.
Explanation.— For the purposes of clause (b) and
section 3-A, wagering or betting shall be deemed
to comprise the collection or soliciting of bets, the
receipt or distribution of winnings or prizes, in
money or otherwise, including through electronic
transfer of funds, in respect of any wager or bet,
or any act which is intended to aid, induce, solicit
or facilitate wagering or betting or such collection,
soliciting, receipt, or distribution;”
(Emphasis Supplied)
b) Section 3-A was introduced to the 1930 Gaming Act for
the first time. The provision placed a restriction on the
activity of betting, in cyberspace using computers and
computer networks, in relation to rummy, poker or any
other game. The provision also places a restriction on
facilitating or organizing any wagering or betting
activities on cyberspace, which is exactly what the
online gaming companies do. The people involved in the
aforementioned activities were made liable to be
punished with imprisonment for up to two years. The
provision is reproduced hereunder:
CA Nos. 6124-6131 of 2023 & Connected Matters Page 6 of 269
“3-A. Wagering or betting in cyber space.—
(1) No person shall wager or bet in cyberspace
using computers, computer system, computer
network, computer resource, any communication
device or any other instrument of gaming by
playing Rummy, Poker or any other game or
facilitate or organize any such wager or bet in
cyberspace.
(2) Whoever wagers or bets in cyberspace using
computers, computer system, computer network,
computer resource, any communication device or
any other instrument of gaming by playing
Rummy, Poker or any other game or facilitates or
organizes any such wager or bet in cyberspace,
shall be punished with imprisonment which may
extend to two years or with fine not exceeding ten
thousand rupees or with both.”
(Emphasis Supplied)
c) More importantly, Section 11 of the 1930 Gaming Act,
which hitherto protected the application of the Act to
games of skill played with stakes, was amended to
extend the application of the penal provisions under the
1930 Gaming Act to games of mere skill played with
stakes. The amended provision is reproduced
hereunder:
“Notwithstanding anything contained in this Act,
Sections 3A and Sections 5 to 10 shall apply to
games of mere skill, if played for wager, bet,
money or other stake.”
CA Nos. 6124-6131 of 2023 & Connected Matters Page 7 of 269
ii. Legal Consequences of the 2021 TN Amendment Act
8. The Amendments carried out categorically laid down that
wagering or betting on any game using cyberspace and a
computer system would constitute gaming under the 1930
Gaming Act, and whosoever engages in such gaming or
facilitates such gaming would be liable for punishment in the
form of imprisonment and fine under Section 3A of the 1930
Gaming Act.
9. Prior to the amendment, Section 11 of the 1930 Gaming Act
had protected games of skill by an express carve-out clause
that exempted the application of the Act to games of mere
skill. Prior to the amendment, the Section read as follows:
“Nothing in sections 5 to 10 of this Act shall be held to
apply to games of mere skill wherever played.”
10. In lieu of the amendment, this protection clause was
removed. By removing the protection clause and amending
the definition of gaming to extend to cyberspace as well, the
State made it an offence to wager or bet on any game, which
includes a game of skill.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 8 of 269
iii. Findings of the High Court of Madras in Junglee
Games
11. The online gaming companies had challenged the
constitutional validity of the 2021 TN Amendment Act on the
ground that it was infringing their fundamental rights and
also because the legislation was manifestly arbitrary as it
clubbed together games of skill and games of chance under
one bucket.
12. The High Court first held that the term gambling connotes
taking a chance and also acknowledged that, in the usual
sense, there is no distinction between skill or chance in order
for it to amount to gambling. It was also held that betting, by
its very nature, cannot be distinguished from gambling as
betting merely denotes the risk-taking element in gambling.
13. The High Court opined that the words gaming and gambling
have developed secondary meanings in judicial parlance and
therefore nomen juris must be given preference irrespective
of the meaning ascribed to the term in dictionaries. Further,
it was held that gambling was equated with gaming and the
activity of gambling, therefore, necessarily involves chance
as a predominant element.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 9 of 269
14. Further, it was held by the Court that the sweeping words of
Section 3-A read with the expansive definition of “gaming”
eliminated all chances for display of skill in virtual platforms,
even if it is played for little stakes. The Court also considered
that the word “gaming” was given a Midas touch in the form
of a legal fiction to include betting on games of skill as well.
15. After having opined that the activity of gambling and the
inextricable element of betting have a negative impact on
society, the High Court questioned the 2021 TN Amendment
Act for completely negating skill.
16. While striking down the amendments to the legislation, the
Court held that the term “betting” cannot be divorced from
gambling and treated as an additional field for the State to
legislate on. The High Court relied on State of Bombay v.
R.M.D. Chamarbaugwala reported in AIR 1957 SC 699
(“ RMDC-I ” ) , R.M.D. Chamarbaugwala v. Union of India
reported in AIR 1957 SC 628 (“ RMDC ‑ II ”), and Dr. K.R.
Lakshmanan v. State of Tamil Nadu & Anr. reported in
(1996) 2 SCC 226 , respectively and concluded that Entry
34 List II does not cover games of skill.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 10 of 269
17. The High Court also held that the State could be said to have
failed the proportionality test by imposing a wide-ranging
blanket ban on games of skill played with stakes.
18. It was held that since the expansive definition of gaming, as
amended, runs through the entire 1930 Gaming Act, the
doctrine of severability cannot be applied, and therefore, the
entire Part II of the 2021 TN Amendment Act came to be
struck down on the ground of being ultra vires the
Constitution.
CIVIL APPEAL NOS. 6132-6144 OF 2023; THE STATE OF
KARNATAKA & ORS. v. ALL INDIA GAMING FEDERATION
& ORS.
19. These appeals arise from the common judgment and order
passed by the High Court of Karnataka dated 14.02.2022 by
which the writ petitions preferred by the respondents herein
(original petitioners/gaming companies) seeking to challenge
the validity of the Karnataka Act No. 28 of 2021 came to be
allowed in the following terms:
“a. The provisions of Sections 2, 3, 6, 8 & 9 of the
Karnataka Police (Amendment) Act 2021 respectively,
i.e., the Karnataka Act No.28 of 2021 are declared to
be ultra vires the Constitution of India in their entirety
and accordingly struck down.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 11 of 269
b. The consequences of striking down of the subject
provisions of the Karnataka Police (Amendment) Act
2021 i.e., Karnataka Act No.28 of 2021 shall follow.
However, nothing in this judgment shall be construed
to prevent an appropriate legislation being brought
about concerning the subject i.e., ‘Betting & gambling’
in accordance with provisions of the Constitution.
c. A Writ of Mandamus is issued restraining the
respondents from interfering with the online gaming
business and allied activities of the petitioners.”
iv. Legislative framework of the 1963 Police Act
20. The Karnataka Police Act, 1963 (hereinafter, “ the 1963
Police Act ”), was amended by the Karnataka Police
(Amendment) Act, 2021 (“ the 2021 Karnataka Amendment
Act ”) in order to curb the growing menace of online betting
and gambling and also to hinder the rise of virtual gambling
houses, for which there was no regulation under the 1963
Police Act.
21. The Statement of Objects and Reasons of the 2021
Karnataka Amendment Act clearly record the reason as
follows:
“It is considered necessary further to amend the
Karnataka Police Act, 1963 (Karnataka Act 4 of
1964) to provide for-
xxx xxx xxx
(ii) include the use of cyberspace including computer
resources or any communication devise as defined in
Information Technology Act, 2000 in the process of
gaming to curb the menace of gaming through
internet, mobile app;”
CA Nos. 6124-6131 of 2023 & Connected Matters Page 12 of 269
22. The 2021 Karnataka Amendment Act introduced a few
modifications to the 1963 Police Act in order to prohibit
online betting and gambling activities. The modifications are
as follows:
a) The scope of Section 2(7) of the 1963 Police Act, which
defined the term gaming, was enlarged to include online
games that involved wagering or betting. Moreover, the
Explanation clause to the definition clarified that the
term wagering or betting includes the collection or
soliciting of bets, the receipt and distribution of
winnings or prizes in money, which is intended to
facilitate the act of risking money on any games,
including in a game of skill. This explanation was
included to bring the online gaming companies that
provide these games within the ambit of the 1963 Police
Act. Section 2(7), as amended by the 2021 Karnataka
Amendment Act reads as follows:
“ Section 2(7): “gaming” means and includes
online games, involving all forms of wagering or
betting, including in the form of tokens valued in
terms of money paid before or after issue of it, or
electronic means and virtual currency, electronic
transfer of funds in connection with any game of
chance, but does not include a lottery or wagering
or betting on a horse-race on any race course
within or outside the State, when such wagering
CA Nos. 6124-6131 of 2023 & Connected Matters Page 13 of 269
or betting takes place]. Explanation (i) to Clause
7: wagering or betting,’ includes the collection or
soliciting of bets, the receipt or distribution of
winnings or prizes, in money or otherwise, in
respect of any act which is intended to aid or
facilitate wagering or betting or such collection,
soliciting, receipt or distribution, any act or
risking money, or otherwise on the unknown
result of an event including on a game of skill and
any action specified above carried out directly or
indirectly by the playing any game or by any
third parties.”
(Emphasis Supplied)
b) The definition of “instruments of gaming” under Section
2(11) was amended to include computers, computer
systems, mobile apps, internet, cyberspace and other
virtual communication devices. Section 2(11), as
amended by the 2021 Karnataka Amendment Act is
reproduced hereunder:
“Instruments of Gaming” includes any article
used or intended to be used as a subject or
means of gaming, including computers, computer
system, mobile app or internet or cyberspace,
virtual communication device, electronic
applications, software and accessory or means of
online gaming, any document, register or record
or evidence of any gaming in electronic or digital
form, the proceeds of any online gaming as or any
winning or prizes in money or otherwise
distributed or intended to be distributed in
respect of any gaming. Explanation- The words
‘computer’, ‘communication device’, ‘computer
network’, ‘computer resource’, ‘computer
system’, ‘cyber café’ and ‘electronic record’ used
in this Act shall have the respective meaning
assigned to them in the Information Technology
Act, 2000 (Central Act 21 of 2000).”
CA Nos. 6124-6131 of 2023 & Connected Matters Page 14 of 269
(Emphasis Supplied)
c) A new provision, Section 2(12A), was introduced to
define the term online gaming. The provision reads as
follows:
“Online gaming” means and includes games as
defined in clause (7) played online by means of
instruments of gaming, computer, computer
resource, computer network, computer system or
by mobile app or internet or any communication
device, electronic application, software or on any
virtual platform.”
d) Section 2(3) of the 1963 Police Act, which defined
common gaming house, defined it to be any place in
which any instruments of gaming are kept or used for
the profit or gain of the person owning, occupying or
keeping such place or the person using such place by
way of a charge for the instruments of gaming or of the
place as a subscription or other payment for the use of
such facilities for the purpose of gaming. This definition
has to be read along with the definition of “place” in
Section 2(13) of the 1963 Police Act. On a cumulative
reading of both the provisions, it would be amply clear
that the online gaming platforms would come under the
ambit of common gaming houses. Section 2(3) is
reproduced hereunder:
CA Nos. 6124-6131 of 2023 & Connected Matters Page 15 of 269
“Common Gaming House”; means a building,
room, tent, enclosure, vehicle, vessel or place in
which any instruments of gaming are kept or
used for the profit or gain, [or otherwise] of the
person owning, occupying, or keeping such
building, room, tent, enclosure, vehicle, vessel or
place, or of the person using such building, room,
tent, enclosure, vehicle, vessel or place, whether
he has a right to use the same or not, such profit
or gain, [or otherwise] being either by way of a
charge for the use of the instruments of gaming
or of the building, room, tent, enclosure, vehicle,
vessel or place, or otherwise howsoever or as
subscription or other payment for the use of
facilities along with the use of the instruments of
gaming or of the building, room, tent, enclosure,
vehicle, vessel or place for purposes of gaming.
(Emphasis Supplied)
e) Section 2(13) of the 1963 Police Act, which defined the
term “place” was amended to include all kinds of virtual
platforms, apps, software and communication devices.
The provision, as it stands amended by the 2021
Karnataka Amendment Act, reads as follows:
““Place” includes a building, a tent, a booth or
other erection, whether permanent or temporary,
or any area, whether enclosed or open including
a recreation club or on virtual platform, mobile
app or internet or any communication device,
electronic application, software, online gaming
and computer resource as defined in Information
Technology Act, 2000 (Central Act 21 of 2000) or
under this Act.”
(Emphasis Supplied)
CA Nos. 6124-6131 of 2023 & Connected Matters Page 16 of 269
f) Section 78(1)(a) of the 1963 Police Act was amended to
punish the owner of online gaming platforms that
involve wagering or betting when such a platform is
used for the purpose of gaming. Sub-clause (vi) of
Section 78(1)(a) penalized any transaction or scheme of
wagering/betting in which the receipt or distribution of
winnings or prizes in money or otherwise is dependent
on chance or skill of other. Sub-clause (vii) of Section
78(1)(a) penalized any act of risking money or otherwise
on the unknown result of an event, including on a game
of skill. The punishment for the aforementioned offence
was imprisonment for up to one year or a fine that may
extend up to rupees one thousand or both. The
provision, to the extent it is relevant, is reproduced
hereunder for the kind perusal of this Court:
“Section 78 : Opening, etc., of certain forms of
gaming.—
(1) Whoever,—
(a) being the owner or occupier or having the use
of any building, tent room, enclosure, vehicle,
vessel or place [or at cyber cafe or online gaming
involving wagering or betting including computer
resource or mobile application or internet or any
communication device as defined in the
Information Technology Act, 2000 (Central Act 21
of 2000)] opens, keeps or uses the same for the
purpose of gaming,—
……
CA Nos. 6124-6131 of 2023 & Connected Matters Page 17 of 269
(vi) on any transaction or scheme of wagering or
betting in which the receipt or distribution of
winnings or prizes in money or otherwise is made
to depend on chance or [skill of other];
(vii) On any act on risking money or otherwise on
the unknown result of an event including on a
game of skill; or
…..
shall, on conviction, be punished with
imprisonment which may extend to one year, or
with fine which may extend to one thousand
rupees, or with both:
Provided that in the absence of special reasons to
be recorded in writing, the punishment to be
imposed on an offender on conviction for an
offence under this sub-section shall be
imprisonment for not less than one month or fine
of not less than five hundred rupees or both.”
g) Section 176 of the 1963 Police Act had previously
explicitly protected wagering or betting on games of skill.
Post the amendment it protects only games of skill from
the rigors of Section 79 and 80 and does not protect
wagering or betting on games of skill. The amended
provision reads as follows:
“For the removal of doubts it is hereby declared
that the provisions of Sections 79 and 80 shall not
be applicable to the playing of any pure game of
skill.”
23. The Amendments have been captured comprehensively, side
by side, in the judgment of the High Court of Karnataka in
All India Gaming Federation (AIGF) v. State of
Karnataka reported in (2022) 1 KCCR 513 .
CA Nos. 6124-6131 of 2023 & Connected Matters Page 18 of 269
v. Legal consequences of the 2021 Karnataka
Amendment Act
24. As is evident from the Statement of Objects and Reasons, the
Karnataka Legislative Assembly wanted to curb the menace
of online betting and gambling and therefore amended the
provisions of the 1963 Police Act. The consequences of the
amendments are as follows:
a) The platforms of the online gaming companies, which
are virtual software applications, were brought under
the ambit of common gaming houses by amending the
definition of the phrase “place”.
b) Computers, mobile phones, internet and cyberspace
have now been brought under the ambit of the definition
“instruments of gaming”.
c) The phrase “gaming” under Section 2(7), means all
forms of wagering or betting using money, tokens valued
in terms of money and every other form of virtual
currency and electronic transfer of funds. The
explanation to the provision makes it very clear that
collection, soliciting, receipt or distribution, any act or
risking money, or otherwise on the unknown result of
CA Nos. 6124-6131 of 2023 & Connected Matters Page 19 of 269
an event including on a game of skill would constitute
wagering or betting and would therefore squarely fall
within the definition of gaming.
d) Section 2(12A) introduces the definition for online
gaming. The provision makes it very clear that all forms
of gaming, as defined under Section 2(7), when played
with instruments of gaming like computers,
applications and mobile phones or other virtual
platforms, would constitute online gaming.
e) Section 78(1)(a) of the 1963 Police Act makes it an
offence for the owner and occupier of online gaming
platforms, that involve betting or wagering, and which
is opened for the purpose of gaming. When such a
platform is used for the following two purposes (as given
in sub-clause (vi) and (vii)), then the offender is liable to
be imprisoned for a period of upto one year or fine or
both.
(i) on any transaction or scheme of wagering or betting
in which the receipt or distribution of winnings or
prizes in money or otherwise is made to depend on
chance or skill of other.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 20 of 269
(ii) on any act of risking money or otherwise on the
unknown result of an event including on a game of
skill.
f) Therefore, from the above provision, it is abundantly
clear that when money is risked on an uncertain event,
even while playing a game of skill, it would constitute an
offence under the 1963 Police Act.
g) Section 176 saved the application of Section 79 and 80
to games of skill. Previously, the provision extended
protection to wagering or betting on games of skill as
well. Now, only games of skill are protected under the
1963 Police Act and wagering or betting on games of skill
is not covered by the protection. The provision prior and
post the 2021 Karnataka Amendment Act is reproduced
hereunder:
“Pre-amendment
176. For the removal of doubts it is hereby
declared that the provisions of Sections 79 and 80
shall not be applicable to the playing of any pure
game of skill and to wagering by persons taking
part in such game of skill.
Post 2021 Amendment
176. For the removal of doubts it is hereby
declared that the provisions of Sections 79 and 80
shall not be applicable to the playing of any pure
game of skill.”
(Emphasis Supplied)
CA Nos. 6124-6131 of 2023 & Connected Matters Page 21 of 269
h) Any offence committed under Section 78 would now be
cognizable and non-bailable in lieu of Section 128A of
the Act.
vi. Findings of the High Court of Karnataka in AIGF
( supra )
25. The High Court of Karnataka held that the terms betting and
gambling under Entry 34 List II have to be read
conjunctively, and one cannot be divorced from the other.
That is to say, the entry has to be read as betting on
gambling activities, which alone fall within the legislative
competence of the State.
26. The Court further held that gambling is something, by its
very nature, that does not depend upon the exercise of skill.
Therefore, as a natural corollary, anything that depends on
skill cannot be termed as gambling.
27. Games of skill do not metamorphize into games of chance
merely because they are played online. Therefore, the
judgment of this Court in MJ Sivani & Ors. v. State of
Karnataka & Ors. reported in AIR 1995 SC 1770 , cannot
CA Nos. 6124-6131 of 2023 & Connected Matters Page 22 of 269
be the best guide to distinguish online games and physical
games.
28. Games of skill and games of chance are two distinct legal
concepts of constitutional significance.
29. The High Court opined that when the State is planning such
a drastic measure to curb online games of skill when played
with stakes, it had to conduct a scientific and empirical
study to analyze the ill-effects of online gaming and its socio-
economic impact.
30. The Court held that online gaming activities, whether played
with or without stakes, do not fall under Entry 34 List II if
they predominantly involve skill, knowledge or judgment.
These activities partake the character of business activities
which have constitutional protection under Article 19(1)(g).
Games of skill are entitled to protection under Article
19(1)(g).
31. The High Court held that the State had failed to justify such
an extreme measure and had therefore failed the test of
proportionality.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 23 of 269
32. Accordingly, Sections 2, 3, 6, 8 and 9 of the 2021 Karnataka
Amendment Act, respectively, were struck down for being
ultra vires to the Constitution and a writ of mandamus was
issued to the State of Karnataka to not interfere with online
gaming business and allied activities of the appellants.
B. SUBMISSIONS ON BEHALF OF THE STATE OF TAMIL
NADU
33. Mr. Kapil Sibal, the learned Senior counsel assisted by Mr.
Sabarish Subramanian, the learned AOR appearing for the
State of Tamil Nadu vehemently submitted that the High
Court committed an egregious error in passing the impugned
judgment and order.
34. Mr. Sibal gave us more than a fair idea as regards the
legislative and litigation history to demonstrate continuity of
the State’s policy right from the notification of the 2020
Ordinance, the challenges posed in 2020-21, the enactment
of the 2021 TN Amendment Act, the 2021 TN Amendment
Act being declared ultra vires by the High Court in the matter
of Junglee Games India Private Limited v. State of T.N.,
reported in 2021 SCC OnLine Mad 2762 , the constitution
of the Justice Chandru committee on 10.06.2022, its report
CA Nos. 6124-6131 of 2023 & Connected Matters Page 24 of 269
dated 27.06.2022 and the enactment of the TN Online
Gambling Act 2022/23 on 07.04.2023 respectively.
35. Mr. Sibal would submit that the rapid digitization and
technological development have caused significant online
gaming addiction among its consumers, leading to
unsustainable debt, financial distress, and suicides. This
“gaming disorder” has been recognised by the WHO in ICD-
11 as a persistent or recurrent pattern of online gaming
behaviour with impaired control and negative priority over
other interests, including continued gaming despite adverse
consequences.
36. He submitted that the online platforms transcend traditional
physical boundaries, enabling instantaneous, large ‑ scale
participation and thereby amplifying risks of social
disruption, financial exploitation, and addiction-related
disorders which directly impact public welfare, and therefore
call for robust State regulation.
37. He argued that “public order” in the context of online gaming
includes the State’s compelling interest in preventing
digitally mediated social unrest, protecting vulnerable
populations from predatory online practices, and preserving
CA Nos. 6124-6131 of 2023 & Connected Matters Page 25 of 269
economic stability through regulation of virtual gambling
activities. The physical sense of “public order” in Entry 1 List
II must, therefore, be interpreted broadly to address the
cross border and exponential impact of online gaming
platforms.
38. Mr. Sibal placed strong reliance on the decision of this Court
in Rev. Stainislaus v. State of Madhya Pradesh , reported
in (1977) 1 SCC 677 to contend that “public order” in Entry
1 List II has a wide connotation. He highlighted that in this
judgment, a law against forcible conversions was upheld
under Entry 1 without requiring any further proof of
widespread incidents, demonstrating that preventive
legislation can be justified under “public order” without
epidemic evidence of harm.
39. He submitted that the factual basis for invoking public order
includes: (1) suicides linked to online gaming and gambling
addiction; (2) financial distress of families; (3) exploitation
arising from the addictive design of online games and
inducement to squander money; and (4) psychological and
physiological harms such as aggressive behaviour, poor
eyesight, reduced concentration, diminished analytical
CA Nos. 6124-6131 of 2023 & Connected Matters Page 26 of 269
thinking, and decreased productivity among youth in the
State.
40. He submitted that the Legislature, being convinced that
online gaming and gambling addiction pose a serious threat
to public order, enacted the TN Online Gambling Act
2022/23 both to regulate online gaming and to prohibit
online gambling, inter alia by creating an Online Gaming
Authority with regulatory powers. The said Act, as a whole,
is directed at curbing the threat of public disorder arising
from online gambling and gaming.
41. In light of the specific risks of online gambling and the
complexity and financial burden of designing a framework
that is regulatory and not prohibitory in nature, the
Legislature reached a conscious conclusion that the most
effective way to prevent public disorder was to prohibit (a)
online gambling by persons within the State; and (b) the
provision of online gambling services by online game
providers altogether. Such a scheme is defended as within
the State’s legislative competence and as a rational response
to the demonstrated harms.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 27 of 269
42. As regards “public health” (Entry 6 List II), Articles 37, 39(f)
and 47 of the Constitution respectively cast a duty on the
State to protect and improve public health, including the
obligation to protect children and youth from exploitation,
and to raise the level of nutrition and standard of living and
to improve public health as a primary duty, drawing an
analogy with the State’s power to prohibit intoxicating drinks
and harmful drugs in the interest of health.
43. He submitted that assuming without admitting that Articles
19(1)(g) and 21 respectively are available to the
respondent ‑ gaming companies and their shareholders, in ‘X’
v. Hospital ‘Z’ reported in (1998) 8 SCC 296 , it was held
that wherever there is a clash between fundamental rights &
public morality the public interest has primacy, and in a
conflict between the two Articles, courts should apply the
test of larger public interest or greater community interest.
This view, according to Mr. Sibal, supports prioritising public
health and safety over business interests in online gambling.
44. With reference to Entry 33 List II (“theatres…sports,
entertainments and amusements”), he submitted that the
TN Online Gambling Act 2022/23, which prohibits gambling
and regulates online games, is also referable to subjects of
CA Nos. 6124-6131 of 2023 & Connected Matters Page 28 of 269
“sports, entertainments and amusements”. Online games
and online gambling are characterised as modern forms of
entertainment, thereby squarely falling within this entry and
therefore within the State’s legislative competence.
45. He submitted that the impugned orders are per incuriam to
the extent it holds that, under Entry 34 List II, the State
lacks competence unless both “betting” and “gambling” are
involved. The High Court has misapplied the dictum laid in
K.R. Lakshmanan (supra) because the said decision
nowhere lays down that a State Legislature cannot legislate
on “betting” independent of “gambling”.
46. He submitted that the impugned orders are incorrect in two
tangents: (a) its reading of RMDC ‑ I (supra) , RMDC ‑ II (supra) ,
and K.R. Lakshmanan (supra) as foreclosing the State’s
power over betting on games of skill; and (b) its conclusion
that “betting” on a game of skill is itself an activity where
success depends on skill, so that Entry 34 does not cover
betting on games of skill. Both these strands are asserted to
be contrary to this Court’s jurisprudence and thus per
incuriam .
CA Nos. 6124-6131 of 2023 & Connected Matters Page 29 of 269
47. He argued that the Entries in the Seventh Schedule must
receive a broad and purposive interpretation and there is a
presumption of constitutional validity. The restrictive
construction adopted by the High Court for Entry 34 violates
the interpretive approach endorsed in Anjum Kadari v.
Union of India (2025) 5 SCC 53 State of U.P.
reported in ,
v. Lalta Prasad Vaish reported in 2024 SCC OnLine SC
3029: 2024 INSC 812 and Asst. Director of Inspection
(Investigation) v. A.B. Shanthi reported in (2002) 6 SCC
259 , respectively, all of which underscore a wide reading of
entries and strong presumptions in favour of legislation.
48. The semantic argument that the conjunction “and” in
“betting and gambling” in Entry 34 requires both elements
together deserves to be outright rejected as contrary to the
established approach. The word “and” appears in many
other entries (e.g., Entry 48 List I: “Stock exchanges and
futures markets”), where such a reading would produce
irrational outcomes (e.g., the Parliament being disabled from
legislating on stock exchanges where no futures are traded).
This illustrates that “and” cannot be read as rigidly
conjunctive to defeat legislative competence.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 30 of 269
49. On the High Court’s view that betting on a game of skill is
itself an activity where success depends on the player’s skill,
he submitted that the court should bear in mind and
distinguish two different scenarios: (a) a player betting on his
or her own success in a game of skill; and (b) a third-party
betting on another person’s success. In the latter case,
although the game is one of skill for the player, yet the
bettor’s success depends on guessing the outcome rather
than exercising skill in the game itself, thereby falling within
the realm of betting activity that a State can regulate as
“betting” under Entry 34.
50. As regards Article 246, Mr. Sibal’s primary contention is that
there is no conflict between List II Entries 1, 6, 33 and 34
respectively and any Union List entry. Even if some overlap
exists, the decision in Hoechst Pharmaceuticals Ltd. &
Ors. v. State of Bihar & Ors. reported in (1983) 4 SCC 45
holds that the non obstante clause in Article 246(1) operates
only when there is an “irreconcilable” conflict, which is
absent here. Therefore, the competence of the State
according to the learned Senior counsel remains unscathed
and intact and the TN Online Gambling Act 2022/23 is
traceable to State entries.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 31 of 269
51. He argued that the statute imposes reasonable restrictions
in the interest of the general public and the State seeks to
rely on the doctrine of proportionality, as applied in M.R.F.
Ltd. v. State of Kerala reported in 1998 (8) SCC 227 , and
subsequent cases wherein it was held that the restrictions
balance the right to carry on business with the State’s
obligation to protect public interest from the harms of online
gambling.
52. He argued that in K.S. Puttaswamy v. Union of India
reported in (2017) 10 SCC 1 and (2019) 1 SCC 1 , it has
been held that no fundamental right, including the right to
privacy, is absolute and that the proportionality test governs
restrictions. The TN Online Gambling Act 2022/23 could be
said to satisfying the legitimate aim, rational connection,
necessity, and balancing, given the documented harms of
online gambling and availability of empirical material placed
by the State, including the various instances of suicides and
addiction-related debt.
53. In the last, the learned Senior counsel submitted that the
respondents’ argument that the TN Online Gambling Act
2022/23 fails the “least intrusive” limb of proportionality
CA Nos. 6124-6131 of 2023 & Connected Matters Page 32 of 269
deserves to be rejected as the State has produced cogent
material that describe the suicides in Tamil Nadu due to
online gaming ‑ related debt and its own empirical studies.
Nothing has been produced by the respondents to show
arbitrariness, much less “manifest arbitrariness,” and
consequently the statute is said to satisfy the proportionality
test.
54. In such circumstances referred to above, Mr. Sibal prayed
that the impugned judgments passed by the High Court of
Madras be set aside, and Part II of the 2021 TN Amendment
Act as well as the Schedule to the TN Online Gambling Act
2022/23 be held intra vires to the Constitution.
C. SUBMISSIONS ON BEHALF OF THE STATE OF
KARNATAKA
55. Mr. Pratik Chaddha, the learned AAG of the State of
Karnataka, vehemently submitted that the High Court
committed an egregious error in passing the impugned
judgment and order.
56. The learned counsel would submit that on a cumulative
reading of the amended provisions and the Statement of
Objects and Reasons, the 2021 Karnataka Amendment Act
does not impose an outright prohibition on online gaming
CA Nos. 6124-6131 of 2023 & Connected Matters Page 33 of 269
because there is no legal embargo on organising or playing
games of pure skill without risking money such as rummy,
carrom, chess, pool, bridge, cross-word, scrabble, fantasy
sports etc., Instead, it merely regulates:
a) Organising and participating in online gaming involving
wagering or betting with stakes in games of chance; and
b) Acts of risking money on the unknown result of games
of skill.
57. He submitted that the respondents’ two-fold challenge is
identified as such:
a) Online gaming is asserted not to amount to “gambling”
and, therefore, the State allegedly lacks the legislative
competence to regulate on the subject;
b) Even if competence is assumed, the provisions allegedly
violate Articles 14 and 19(1)(g).
58. He would argue at the outset, there are two broad structural
types of games where money is staked on unknown
outcomes:
a) Games where players bet inter se as a private group and
the platform/house takes a rake or commission for
enabling the betting medium like in poker, rummy etc.;
and
CA Nos. 6124-6131 of 2023 & Connected Matters Page 34 of 269
b) Games where many players participate not directly
against each other but against the house/platform like
in online roulette and online slots.
59. Online gaming operates in both structures but because of
anonymity and the “veil of ignorance” in the online
environment, a player is always placing a bet on an
inherently unknowable outcome, including uncertainty on
whether opponents are individuals, prodigies, or bots, or are
even aided by AI. This heightens the gambling-like character
of such activity and justifies regulatory intervention.
60. The State can trace its legislative competence to enact the
impugned legislation primarily under Entry 34 of List II
(“Betting and gambling”), and, alternatively or cumulatively,
under Entries 1 (Public order), 2 (Police), 6 (Public health),
26 (Trade and commerce), and 33 (Sports, entertainments,
amusements) of List II, together with Article 246(3).
61. Even if the respondent’s plea is accepted that the impugned
subject matter does not fall under Entry 34, that does not
negate competence because the subject may still fall within
other State entries. If the legislation can be traced to even
one valid State entry, competence is established. Reliance is
CA Nos. 6124-6131 of 2023 & Connected Matters Page 35 of 269
placed on Mineral Area Development Authority v. SAIL
reported in 2024 INSC 554, wherein this Court had held
that:
a) entries in the Seventh Schedule are to be interpreted
broadly and liberally, covering all reasonable facets and
ancillary matters,
b) legislative fields can overlap with competence deriving
from multiple entries, and
c) the doctrine of pith and substance requires examination
of the true nature and character of the law, not its form
or label.
62. Irrespective of it being online or offline, gambling is rex extra
commercium and States have competence to regulate such
activity under Entry 34 of List II. The central controversy is
whether Entry 34 also authorises the regulation of online
games of skill when money is staked on uncertain outcomes.
63. The impugned order has erred in holding that “betting and
gambling” in Entry 34 must be read conjunctively, i.e., as
confining State competence to “betting on gambling”, thereby
excluding betting anchored in skill. The High Court’s
observation that “chance pervasively animates betting” is a
misreading of the constitutional text and history.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 36 of 269
64. As regards Entry 34, the learned counsel argued that:
“ Betting and gambling” covers all acts of wagering or
staking money on uncertain outcomes, irrespective of
whether the underlying games involves elements of
skill; and once money is staked on the unknown
outcome (including of a game of skill), the activity falls
within “betting”, which the Constitution places within
State control under Entry 34 .”
65. Section 176, which historically carved out a saving for “pure
games of skill”, including wagering by persons taking part in
such game, is retained, and this is relied upon to show that
the law does not prohibit pure skill games per se but targets
the act of risking money on uncertain outcomes. The
legislative focus remains on betting and gambling, not the
game in abstraction.
66. Independent of Entry 34, the State can still validly legislate
on online gaming with stakes because they easily fall within
the composite regulatory space created by the following
Entries:
a) Entry 1 (Public order) and Entry 2 (Police) to address
law ‑ and ‑ order disturbances, vice, and associated
criminality linked with organised online betting;
b) Entry 6 (Public health) to tackle addiction and
indebtedness harms associated with online gambling
behaviour;
CA Nos. 6124-6131 of 2023 & Connected Matters Page 37 of 269
c) Entry 26 (Trade and commerce) to regulate the business
and commercial exploitation of gaming platforms within
the State; and
d) Entry 33 (Sports, entertainments and amusements) to
regulate games and entertainment activities offered
online to the public.
67. The 2021 Karnataka Amendment Act amends the following
definitions to bring the online architecture of gaming within
the enforcement ambit of the Act:
a) “Common gaming house” in Section 2(3) covers any
place where instruments of gaming are kept or used for
profit or “otherwise” of the person owning or using such
place, including subscription or other payment ‑ based
models;
b) “Gaming” in Section 2(7) explicitly covers “online games
involving all forms of wagering or betting” and defines
“wagering or betting” to include any act of risking money
on unknown results of any event, “including on a game
of skill”;
c) “Instruments of gaming” in Section 2(11) includes
computers, computer systems, mobile apps, internet,
cyberspace, virtual communication devices, electronic
applications, and associated software and digital
records of gaming proceeds;
d) “Online gaming” in Section 2(12A) and “place” in section
2(13) are extended to virtual platforms and computer
resources as defined in the IT Act, 2000.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 38 of 269
68. Sections 78, 79, 80, and 87 of the 1963 Police Act
respectively, are strengthened to criminalise opening,
keeping, or using any physical or virtual place (including
online platforms) for gaming involving wagering or betting
and “any act of risking money or otherwise on the unknown
result of an event, including on a game of skill”. It also
enhances penalties for keeping common gaming houses and
for persons found gaming therein up to three years’
imprisonment and fines up to Rs. 1 lakh, with graded
minimum sentences for repeat offences. Section 80,
specifically, aligns public-street gaming penalties when
gaming consists of wagering or betting and provides for
forfeiture of money found on such persons.
69. Section 128A declares all offences under Chapter VII (except
section 87) and certain Chapter VIII offences (including
section 114) to be cognizable and non ‑ bailable, with Section
87 being cognizable and bailable, to ensure effective
enforcement against online gaming ‑ related offences.
70. The enhanced penalties provided by Section 114 of the 1963
Police Act for entering areas from which a person has been
directed to remove himself (up to two years’ imprisonment
and fines up to Rs. 1 lakh with a minimum fine of Rs. 25,000)
CA Nos. 6124-6131 of 2023 & Connected Matters Page 39 of 269
are presented as part of the broader control framework
strengthened by the amendment.
71. The learned counsel made the following submissions in
relation to the respondents’ contending violation of Article 14
and Article 19(1)(g):
a) Article 19(1)(g) protection is not available to body
corporates in the same manner as natural persons,
which affects standing and the nature of rights asserted;
b) In any event, the restrictions imposed are reasonable, in
the interests of the general public, and thus saved by
Article 19(6), given the objective of combating gambling
addiction, indebtedness, and social ills;
c) The classification drawn by the Act, focusing on
wagering/betting and acts of risking money (rather than
pure skill games without stakes), is non ‑ arbitrary and
bears rational nexus to the legislative object, thereby
satisfying Article 14.
72. The learned counsel advanced the same contentions as those
urged on behalf of the State of Karnataka.
D. SUBMISSIONS ON BEHALF OF THE GAMING COMPANIES
IN THE TAMIL NADU AND KARNATAKA AMENDMENT
GAMING BATCH
D.1. Submissions of Ld. Senior Counsel Mr. Abishek Manu
Singhvi appearing for respondent No.1 (Gameskraft) in
C.A. Nos. 6132-6143 of 2023:
CA Nos. 6124-6131 of 2023 & Connected Matters Page 40 of 269
73. The impugned Tamil Nadu and Karnataka amendments, and
the TN Online Gambling Act 2022/23, define “gaming” as the
playing of online games for winning money or other stakes
thereby obliterating the distinction between games of skill
and games of chance.
74. The impugned enactments impose a blanket ban on online
rummy, are not regulatory in character, and fall outside the
State legislative competence.
75. The States’ claim to legislate on all online games under
Entries 1, 2, 6, 26, 33 and 34 of List II is incorrect because
they may legislate only on “betting and gambling” (Entry 34,
List II), which is confined to games of chance. Games
involving a substantial or preponderant degree of skill, on
the other hand, fall outside this Entry and are protected as
legitimate business under Article 19(1)(g) of the Constitution,
not as res extra commercium gambling activities.
76. The expressions “betting and gambling”, “gaming”, “games of
skill” and “games of chance” stand conclusively interpreted
in the following cases:
• RMDC ‑ I ( supra ), which interpreted “betting and
gambling” in Entry 34, List II and upheld taxation of
CA Nos. 6124-6131 of 2023 & Connected Matters Page 41 of 269
gambling but excluded competitions involving
substantial skill;
• RMDC ‑ II ( supra ), which reiterated that prize
competitions substantially dependent on skill are not
gambling and are protected under Article 19(1)(g);
• K.R. Lakshmanan ( supra ), which held horse ‑ racing to
be a game of skill and construed “gaming” as wagering
or betting on games of chance, not on games of skill.
77. These landmark cases have essentially clarified that “betting
and gambling”, “gaming” and “games of chance” in Entries
34 and 62 of List II are all held to exclude games of skill,
which form a separate category outside the State’s gambling
power.
78. From the Public Gambling Act 1867 onwards, State
“gaming”/“gambling” statutes traceable to Entry 34, List II
have prohibited betting or wagering only on games of chance
and have consistently carved out exceptions for “games of
mere skill”.
79. The presence of stakes or money does not change its
essential character or convert it into “betting and gambling”.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 42 of 269
80. There is no substantive difference between online and offline
rummy or poker for purposes of characterisation. The nature
of the game, rules, and requirements of skill remain identical
in both formats, as found by the Madras and Karnataka High
Courts when invalidating the impugned bans.
81. The respondent company operates as an “online gaming
intermediary” within the meaning of the Information
Technology Act, 2000 (“ IT Act ”) and the Information
Technology (Intermediary Guidelines and Digital Media
Ethics Code) Rules, 2021 (“ IT Rules ”), offering a platform on
which players compete in online rummy. The company itself
does not participate as a player or wager on game outcomes.
82. The platform’s revenue model is limited to charging a fixed
“platform fee” or commission of about 7–10% on players’
buy ‑ in amounts, with no fee levied on the players’ winnings.
Again, the respondent does not engage in betting on the
games played, unlike a gambling house that shares in wins
or losses.
83. The impugned laws were framed without any empirical data
or due diligence regarding the platform’s features or alleged
harms. The Madras High Court in AIGF
CA Nos. 6124-6131 of 2023 & Connected Matters Page 43 of 269
(supra) specifically took notice of the absence of any study or
material justifying a total ban on online rummy.
84. In construing Entry 34, List II, “betting” must take colour
from “gambling”. The State’s competence under Entry 34
extends only to betting in relation to gambling (games of
chance), and not to betting in relation to games of skill,
which remain constitutionally distinct.
85. The States’ main counter ‑ contention is that “betting and
gambling” in Entry 34 should be read disjunctively as
“betting or gambling”, so that “betting” covers all betting,
including on games of skill, while “gambling” covers games
of chance. On this reading, the State claims competence over
both classes of games.
86. This disjunctive reading is flawed because it implies that any
game played for stakes, including skill ‑ based games like
rummy or even chess, would fall within “betting and
gambling”, directly contradicting RMDC ‑ I (supra) , RMDC ‑ II
(supra) and K.R. Lakshmanan (supra) and nullifying
long ‑ recognised statutory and judicial exceptions for games
of skill.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 44 of 269
87. The States’ disjunctive construction is also inconsistent with
the Parliament’s own usage in Section 65B(15) of the Finance
Act 1994, where “betting” and “gambling” are used together
to denote staking money or otherwise on outcomes
determined by chance or accident. The Parliament does not
treat “betting” on games of skill as falling within “betting and
gambling” for tax and regulatory purposes.
88. The High Courts’ interpretation of “betting and gambling” as
“betting on a game of chance” is in line with six decades of
binding Supreme Court precedents, beginning with RMDC ‑ I
(supra) , RMDC ‑ II (supra) , State of Andhra Pradesh v.
Satyanarayana reported in 1967 INSC 269: 1968 (2) SCR
387 and K.R. Lakshmanan (supra) . On this settled law,
rummy, being a game of skill, when played online cannot be
treated as a game of chance for the purposes of Entry 34.
D.2. Submissions of Ld. Senior Counsel Mr. Aravind Datar
appearing for Head Digital Works in Civil Appeal No.
6124 of 2023 :
89. The 2021 Tamil Nadu and Karnataka amendments to the
respective States’ Police Acts criminalised all online games,
whether of skill or of chance, and removed the statutory
exception that had protected games of skill since 1867.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 45 of 269
These provisions were consequently correctly struck down
by the respective State High Courts.
90. The TN Online Gambling Act 2022/23 is ostensibly a statute
to prohibit online gambling and regulate online gaming, but
its provisions, including the Schedule, in fact extend to the
games of skill such as rummy and poker.
91. Under Article 19(1)(g), if a game is a game of skill, it cannot
be treated as gambling, which is the premise upon which
both the Karnataka and Madras High Courts respectively
have proceeded in their rulings.
92. No interference by this Court is warranted in the present
matter because the High Courts have merely applied and
followed the long ‑ standing Supreme Court precedents on the
distinction between games of skill and games of chance, and
could not, in law, have upheld the impugned provisions that
criminalised games of skill.
93. As regards the TN Online Gambling Act 2022/23 (dealt with
in SLP(C) Nos. 1588 ‑ 1592 OF 2024):
a) The Statement of Objects and Reasons states that the
statute is to prohibit online gambling and regulate
CA Nos. 6124-6131 of 2023 & Connected Matters Page 46 of 269
online gaming. However, the operative provisions go
further and expressly prohibit rummy and poker, which
are recognised games of skill.
b) Through provisions such as Section 2(1), Section 7 and
the Schedule, a legal fiction is created by which the
games listed in the Schedule are deemed to be “games
of chance”. At present, only rummy and poker are
included in this list, which are games of skill.
c) The remaining provisions of the TN Online Gambling Act
2022/23 regulating online gaming, other than those
that which deem games of skill to be games of chance,
are not under challenge and are upheld. In substance,
the TN Online Gambling Act 2022/23 is tailored to
overcome and nullify the earlier decision in Junglee
Games ( supra ), rather than to genuinely address online
gambling.
94. With respect to stakes, betting and gambling, the
jurisprudence over the last 150 years demonstrates that
there has never been any legal objection or controversy to
the presence of stakes or consideration in games of skill. The
only consistent controversy has been whether an activity is
CA Nos. 6124-6131 of 2023 & Connected Matters Page 47 of 269
a game of skill or a game of chance, and legislative
prohibitions have historically targeted only games of chance.
95. If the Parliament or a State Legislature cannot, for regulatory
purposes, reclassify games of skill as games of chance, they
equally cannot do so for taxation purposes. Treating games
of skill as gambling would require an appropriate
constitutional amendment. The mere fact that there is
betting, staking or consideration involved in playing a game
of skill cannot by itself convert such activity into “gambling”.
D.3. Submissions of Ld. Senior Counsel Shri. Aryama
Sundaram appearing for the All India Gaming
Federation in C.A. Nos. 6124 of 2023 :
96. A statute’s character as regulatory or prohibitory depends on
the nature of the act being targeted and whether it is res
. Games of skill are not
extra commercium res extra
commercium . Treating games of skill as res extra commercium
when played for stakes is contrary to RMDC II (supra) and
K.R. Lakshmanan (supra) respectively and impermissibly
removes them from Article 19(1)(g) protection.
97. Legitimate prize competitions and games of skill cannot be
equated with gambling since the legislative fields for taxing
CA Nos. 6124-6131 of 2023 & Connected Matters Page 48 of 269
games of skill and games of chance are distinct (being
Entries 60 and 62).
98. The 2021 TN Amendment Act expands “common gambling
house” to include computers, computer systems, networks,
resources and communication devices, and criminalises
“wagering or betting in cyberspace”. Therefore, in pith and
substance, the enactment regulates online platforms and
intermediaries operating in cyberspace (provision of access,
transmission, modification of content) which is a subject
that is exclusively within the legislative domain of the
Parliament under the IT Act and Entry 31 List I.
99. The 2021 Karnataka Amendment Act removes offline games
(skill and chance) from the 1963 Police Act and prohibits
only online games of skill and chance, thereby targeting
online activity as such rather than gambling per se , again
trenching on the Union field and creating irrational
discrimination between online and offline formats.
100. The impugned legislations cannot be justified under Entry 1
(public order) of List II because law-and-order infractions like
cheating or breach of trust do not ipso facto amount to
CA Nos. 6124-6131 of 2023 & Connected Matters Page 49 of 269
“public order”. However, disturbances affecting the
community or public at large fall within that entry.
101. States cannot rely on Entry 2 (police) of List II to regulate
games of skill per se because mere potential for individual
misuse (addiction, cheating) is a law-and-order concern, not
a sufficient constitutional basis for broad prohibitions
framed as public order measures.
102. Playing games of skill is also a leisure activity and a vocation
for many, constituting both a livelihood and a form of
expression. Therefore, in addition to Article 19(1)(g), it is also
protected by Article 19(1)(a), subject only to Article 19(2). The
2021 TN Amendment Act, by which Section 3A was inserted
to the 1930 Gaming Act and Section 11 of the said Act was
amended as well as the 2021 Karnataka Amendment Act by
which Section(s) 2(7), 78(1)(a)(vi)–(vii) and 176 of the 1963
Police Act respectively were amended, in effect penalise
staking on games of skill and thus, directly restrict protected
expression and profession, requiring strict justification
under Articles 19(2) and 19(6) respectively.
103. The State has failed to relate the restrictions to any Article
and to justify their proportionality. Criminal penalties and
CA Nos. 6124-6131 of 2023 & Connected Matters Page 50 of 269
complete bans on online games of skill played for stakes are
wholly disproportionate, particularly when detailed
regulatory mechanisms under the IT Act demonstrate less
restrictive alternatives.
104. The IT Rules already provide calibrated measures to address
concerns such as sovereignty, public order, user harm, child
protection, gaming addiction, financial loss and fraud
(through warnings, self-exclusion, parental controls, and
age-rating), illustrating that a complete ban under State laws
is unnecessary and excessive.
105. The impugned Acts are discriminatory and manifestly
arbitrary under Article 14 because they lack a coherent
determining principle and have the direct and inevitable
effect of targeting legitimate gaming businesses under the
guise of regulating “gambling”.
106. Constitutional scrutiny must address the actual effect of the
law on the fundamental rights rather than its stated object.
By that measure, the impugned laws directly impair the
rights of operators and players engaged in games of skill,
thereby attracting review of Articles 14 and 19, respectively
CA Nos. 6124-6131 of 2023 & Connected Matters Page 51 of 269
as per Rustam Cavasjee Cooper v. Union of India reported
in 1970 (1) SCC 248 .
107. The TN Online Gambling Act 2022/23 is overbroad because
it seeks to prohibit all forms of games of skill played for
stakes via its wide definition of “online game of chance” and
its Schedule, including tournaments conducted within the
State of Tamil Nadu, thereby sweeping in constitutionally
protected skill-based activities far beyond any rational
objective.
108. The 2021 Karnataka Amendment Act is discriminatory and
arbitrary because, by using a “means and includes”
definition of gaming, it excludes offline games (skill and
chance) from the 1963 Police Act while prohibiting only
online games of skill and chance, without any intelligible
differentia linked to a legitimate objective.
109. The TN Online Gambling Act 2022/23 discriminates between
online and offline games of skill by preserving the protection
under the 1930 Gaming Act for offline skill-games but
denying the same protection to online skill-games and
further deeming online games of skill to be games of chance,
CA Nos. 6124-6131 of 2023 & Connected Matters Page 52 of 269
rendering the classification irrational and violative of Article
14.
110. The 2021 TN Amendment Act contained inherent
contradictions leading to absurd results, as held by the
Madras High Court, justifying its being struck down. Re-
enacting substantially similar defects in subsequent
legislation perpetuates these constitutional infirmities.
111. The specific legislative classification of rummy and poker as
games of chance is erroneous in law, contrary to established
precedents on the predominance-of-skill test and to the
factual nature of these games as involving skill in strategy,
probability, psychology and rule-mastery.
D.4. Submissions of Ld. Senior Counsel Mr. Mukul Rohtagi
appearing for respondent No. 18 (Federation of Indian
Fantasy Sports) in C.A. Nos. 6132-6144 of 2023
:
112. A “game of chance” is one where no skill is involved and
which depends on the outcome of an uncertain event,
whereas a game of skill (such as bridge or rummy) involves
memorising cards, testing the strength of the other side and
using strategy. Rummy has been judicially recognised as a
game mainly and preponderantly of skill, despite an element
of chance in the deal of the cards.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 53 of 269
113. For the last 75 years, games like rummy, earlier played
physically, have been held to be games “predominantly of
skill”, and therefore games like poker, rummy and Fantasy
Sports (“ FS ”) are completely games of skill.
114. FS is an internet-based team-selection contest, played over
a predetermined number of rounds (from a single
match/event to an entire league/series), in which the user
acts as a coach/selector of a virtual team of real players from
real teams, and competes against other users’ virtual teams,
not against the FS platform (no house).
115. Outcomes in FS contests are tabulated solely on the basis of
statistics, scores, achievements and performance of real
players in designated professional sporting events, with
users selecting and curating teams using parameters such
as player form, pitch conditions, historical data, venue
performance and other factors, thereby involving significant
skill and analysis.
116. FS contests operate independently of the final result of the
underlying real-world match (including if the match ends in
a draw) because winners in FS are determined by
accumulated fantasy points based on predefined scoring
CA Nos. 6124-6131 of 2023 & Connected Matters Page 54 of 269
metrics (runs, wickets, catches, etc.) and not on who wins or
loses the real match.
117. All participants pay a standard entry fee, which goes into a
pre-declared prize pool. These prizes are distributed
according to a pre-declared rank-based chart, with typically
more than 60% contestants emerging as winners, and the
entry fee is therefore a contribution towards a competition of
skill (akin to chess or quiz tournaments) and not a wager on
an uncertain event.
118. A “bet” necessarily involves placing stakes on an uncertain
event with a fixed return. FS contests, being skill-based
fixed-prize competitions where the operator charges only a
base entry fee and does not compete, do not constitute
“betting and gambling” or “betting” or “gambling”.
119. The FS platform merely hosts skill-based prize contests and
provides administrative, statistical and analytical services in
exchange for fixed entry fees, does not participate in
contests, does not place bets, does not have winnings
contingent on outcomes, and therefore cannot be considered
a “winner” under gambling statutes.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 55 of 269
120. Foreign courts such as the United States District Court, New
Jersey, have distinguished bona fide entry fees from bets or
wagers and have held that entry fees paid unconditionally
for participation in contests with guaranteed, pre-declared
prizes (in which the operator is not a contestant) are not bets
or wagers. This reasoning squarely applies to FS.
121. Under the Unlawful Internet Gambling Enforcement Act of
2006 (UIGEA), participation in FS contests that meet
specified conditions such as (a) pre-declared prizes not
linked to number/amount of fees, (b) winning outcomes
reflecting relative knowledge and skill based on accumulated
statistical performance in multiple real-world events, and (c)
no winning outcome based on a single team or single
athlete’s single performance is expressly excluded from the
definition of illegal “bets” or “wagers”, thereby affirming that
such FS contests are not gambling.
122. The US Court of Appeals in White v. Cuomo reported in
2022 NY Slip Op 01954 held that “gambling” encompasses
staking value on a game where chance predominates over
skill or risking value through bets/wagers on contests of skill
where the wagered pool is awarded based on future events
outside the wagerer’s control, and clarified that games in
CA Nos. 6124-6131 of 2023 & Connected Matters Page 56 of 269
which skill predominates and skill-based competitions for
predetermined prizes where participants influence outcomes
do not constitute gambling. FS falls within this non-
gambling category.
123. The Illinois Supreme Court in Colin Dew-Becker v. Wu
reported in 2020 IL 124472 examined three tests
(predominant factor test, material element test, any-chance
test) to distinguish skill from chance, rejected the any-
chance and material-element tests as overbroad/subjective,
adopted the predominant factor test as the most appropriate,
and concluded that head-to-head DFS contests are
predominantly determined by skill, and thus do not amount
to “gambling” under the relevant statute.
124. Since 1822, Indian gambling legislation has consistently
excluded games of skill from the ambit of “gambling” and
“betting”, this long-standing legislative policy confirms that
skill-based activities, including FS, fall outside “betting and
gambling”.
125. The concept of “bet” was introduced legislatively in the 1922
amendment to the Madras City Police Act, 1888, and these
developments were precursors to the inclusion of “betting
CA Nos. 6124-6131 of 2023 & Connected Matters Page 57 of 269
and gambling” in Entry 36, List II of the Government of India
Act, 1935 and, subsequently, Entry 34, List II of the Seventh
Schedule to the Constitution, indicating that “betting and
gambling” is a term of art tied to monetary stakes and not to
mere participation in skill contests.
126. “Betting and gambling” are always associated with money or
property in lieu of money (a “bet” or “stake”). Even where
games of skill are played, betting is an optional overlay,
whereas games of pure chance cannot be played without a
bet, indicating that the true test is whether the underlying
activity is a game of skill or a game of chance, and not merely
whether money is involved.
127. Early Indian enactments such as Act IX of 1851 and the
Public Gambling Act, 1867, while penalising gambling in
common gaming houses and staking money on cards/dice,
contained explicit savings provisions excluding games of
skill, and later state enactments (e.g., the Bombay
Prevention of Gambling Act) followed the same model,
reinforcing that games of skill have always been legislatively
distinguished from gambling.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 58 of 269
128. Moreover, regulation of online gaming and FS is primarily
within the Parliament’s domain under Union List Entry 31
(“posts and telegraphs; telephones, wireless, broadcasting
and other like forms of communication”) because FS
platforms are entirely dependent on the internet, which falls
within “communication” in Entry 31, for every key functional
aspect of their operation.
129. Matters related to online gaming have been specifically
assigned to the Ministry of Electronics and Information
Technology (MeitY) under the Government of India
(Allocation of Business) Rules, 1961, and MeitY has
expressly stated on affidavit that its power to regulate online
gaming flows from Union List Entry 31, reinforcing that the
subject is located in the Union List.
130. In addition to Entry 31, the Parliament has competence over
online gaming and FS under Union List Entry 42 (“Inter-
State trade and commerce”) because online fantasy sports
platforms are transboundary, virtual in nature, operate
seamlessly across State borders, and enable user
participation irrespective of location. They inherently
constitute inter-State trade and commerce, which States
cannot regulate under their intra-State trade entry.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 59 of 269
131. The Parliament is also competent under Union List Entry 97
(residuary power) because no specific entry in any of the
three Lists directly addresses online gaming or FS. Given the
technological complexity and novelty of online gaming and
the absence of an express State List entry, regulation of such
platforms necessarily falls within the Parliament’s residuary
domain.
132. Independent regulation of online gaming by individual
States, by invoking State List entries, would result in
regulatory chaos and duplicative compliance obligations for
pan-India online platforms, which is inconsistent with the
constitutional allocation of such cross-border, technology-
based activities to the Union under Entries 31, 42 and 97 of
the Union List.
133. The entries in the Lists of the Seventh Schedule are fields of
legislation, not self-standing powers, and one entry cannot
be interpreted so expansively as to cancel, obliterate, or
render meaningless another entry in the same or another
List. The States’ construction of their entries would make
Union enactments on online gaming under Union List
entries redundant.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 60 of 269
D.5. Submissions of Ld. Senior Counsel Mr. Neeraj Kishan
Kaul appearing for respondent No. 2 (Galactus) in C.A.
Nos. 6132-6143 of 2023 :
134. The challenge in these proceedings is to the 2021 Karnataka
Amendment Act, Sections 2, 3, 6, 8 and 9 of which amended
various provisions of the 1963 Police Act, resulting in a
common judgment of the Karnataka High Court dated 14
February 2022 striking down those provisions as
unconstitutional.
135. By amendments to definitions in Section 2 and to
offence ‑ creating provisions (including Sections 78, 79, 80,
87, 114, 128A and the saving clause in Section 176), the
2021 Karnataka Amendment Act, read with its Statement of
Objects and Reasons, effectively imposes a complete
embargo/ban on organising and playing all forms of online
gaming where wagering or betting with stakes (monetary or
otherwise) is involved, expressly covering both games of
chance and games of skill.
136. The questions raised and subsequently addressed are:
1. Whether the State of Karnataka had legislative
competence to enact a law (regulating or prohibiting)
relating to online games of skill with monetary stakes,
CA Nos. 6124-6131 of 2023 & Connected Matters Page 61 of 269
under any entry in List II of the Seventh Schedule,
particularly Entry 34 (“betting and gambling”)?
2. Whether, even assuming there is competence, a total
prohibition on online games of skill with stakes satisfies
the strict tests of reasonable restriction under Article
19, particularly Article 19(1)(g) and 19(1)(a) read with
Articles 19(6) and 19(2)?
3. Whether the 2021 Karnataka Amendment Act is
consistent with Article 14, including principles of
reasonable classification and non ‑ arbitrariness, or
whether it is manifestly arbitrary and lacking rational
nexus with its professed objectives?
137. The State asserts competence under Article 246(3), read with
Entry 34 of List II of the Seventh Schedule (“betting and
gambling”). However, Article 246 and Entry 34 limit State
power to matters enumerated there, and Entry 34 only
covers “betting and gambling”. The mere involvement of
money or stakes in a game of skill does not change its
essential character into a game of chance and does not
automatically bring such activity within “gambling” or Entry
34. Therefore, games of skill, even when played for stakes,
fall outside this entry.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 62 of 269
138. It is contended that Entry 34 is a single composite
expression. Therefore, “betting” is not a distinct,
free ‑ standing subject but is conjunctively linked with
“gambling”, and the use of “and” (instead of “or”) shows
legislative intent to regulate betting only when it is integrally
connected with gambling activities. Since the impugned
amendments extend their operation to games of skill
(including online skill ‑ based formats with monetary stakes),
they travel beyond “betting and gambling” in Entry 34 and
therefore lie outside State legislative competence under
Article 246(3).
139. The 2021 Karnataka Amendment Act, by imposing a blanket
embargo on all online games with stakes (including those
that are games of skill), directly impacts the fundamental
right to carry on trade or business under Article 19(1)(g) of
operators like respondent No. 2 who exclusively conduct
skill ‑ based online gaming and e ‑ sports activities. This
amounts to a total ban, and, therefore, fails the test of
reasonable restrictions under Article 19(6).
140. Insofar as the 2021 Karnataka Amendment Act imposes a
total embargo on offering or participating in such online
CA Nos. 6124-6131 of 2023 & Connected Matters Page 63 of 269
games of skill for stakes, it restricts this expressive activity,
and that restriction neither fits within the specific grounds
enumerated in Article 19(2) nor meets the requirement of
reasonableness, especially given the overbroad sweep of the
prohibition.
141. The amendment is violative of Article 14 for drawing no
constitutionally valid distinction between games of chance
(gambling in the proper sense) and games of skill (whether
or not played for stakes, including online skill ‑ based games),
by treating both categories identically, conflating games of
skill with gambling, and subjecting them to a common total
prohibition when played with stakes.
142. There is no intelligible differentia justifying the singling out
of the online mode of playing skill ‑ based games with stakes
for a complete embargo, particularly when the mischief
sought to be addressed is “gambling” and “menace of
gaming”, and skill ‑ based operators like MPL are
demonstrably distinct in character and operation. Thus, the
legislation lacks rational nexus to its stated objective.
143. Given the Supreme Court’s consistent treatment of games of
skill as a distinct non ‑ gambling category (for example,
CA Nos. 6124-6131 of 2023 & Connected Matters Page 64 of 269
rummy, horse ‑ racing, and other competitions in RMDC-II
, Satyanarayana , and K. R. Lakshmanan
(supra) (supra)
(supra) , it is arbitrary for the legislature to ignore this
jurisprudence and to subject online games of skill to an
outright ban under a statute which is, in pith and substance,
directed at “prevention of gambling”.
144. It is also contended that, apart from Entry 34, no alternative
entry in List II can justify the impugned legislation, because
in pith and substance the amendment is directed at “betting
and gambling”, as reflected in the history of the parent Act
and the wording and structure of the amendments, and once
games of skill are excluded from “gambling”, they cannot be
drawn in by resort to any other State List entry.
D.6. Submissions of Ld. Senior Counsel Mr. Sajan Poovaya
appearing for Play Games 24x7 Ltd. and Junglee Games
India Pvt. Ltd in C.A. Nos. 6124-6131 of 2023, C.A. Nos.
6132-6143 of 2023 and SLP (C) Nos. 1588-1592 of 2024:
145. The 2021 TN Amendment Act is unconstitutional because it:
a) Expands “gaming” to include any game involving
wagering or betting, whether in person or in cyberspace,
thereby illegitimately bringing even online games of skill
within the statute;
CA Nos. 6124-6131 of 2023 & Connected Matters Page 65 of 269
b) Introduces Section 3A, imposing a blanket prohibition
on wagering or betting in cyberspace for rummy, poker
or any other game, without distinguishing games of skill
from games of chance;
c) Amends Section 11 to remove the exemption for games
of mere skill and subjects them to a total ban when
played for wager, bet, money or stakes, notwithstanding
their skill ‑ based nature.
146. The Madras High Court’s judgment dated 03.08.2021
correctly held that:
a) The business of organising or offering games of skill is
a protected occupation under Article 19(1)(g), while the
game of skill itself may attract protection under Article
19(1)(a);
b) Competitions involving substantial skill are not
“gambling” and thus fall outside Entry 34 List II, being
protected as trade or business under Article 19(1)(g), in
line with K.R. Lakshmanan (supra) ;
c) The 1930 Gaming Act’s original scheme, which confined
“gaming” to games of chance, was impermissibly
inverted by outlawing all games played for stakes,
CA Nos. 6124-6131 of 2023 & Connected Matters Page 66 of 269
ignoring the constitutionally relevant distinction
between skill and chance.
147. The Madras High Court correctly held that under Entry 34
List II, “betting and gambling” must be read conjunctively.
“Betting” cannot be divorced from “gambling” so as to create
an independent, broader head of competence covering
betting on games of skill:
a) “Betting and gambling” refers only to betting integral to
gambling, i.e., betting on games of chance;
b) Judgments in RMDC (both decisions) and K.R.
Lakshmanan (supra) make it clear that “betting” in
Entry 34 does not extend to skill games;
c) If the State seeks to rely on Entries 1, 26 or 33 List II
instead, it must satisfy the doctrine of proportionality,
which it has not done.
148. The blanket prohibition on games of skill in the 2021 TN
Amendment Act fails the “least intrusive measure” test and
violates Article 19(1)(g), because:
a) The State did not adopt calibrated regulation but
‑
imposed a wide ranging, indiscriminate ban;
CA Nos. 6124-6131 of 2023 & Connected Matters Page 67 of 269
b) The prohibition runs contrary to the Supreme Court’s
settled jurisprudence protecting games of skill as
business activity.
149. The 2021 Karnataka Amendment Act is unconstitutional for
the following reasons:
a) It removed the exemption in Section 176 for “games of
skill and wagering by persons taking part in such game
of skill”, thereby criminalising the act of staking money
on games of skill;
b) By amending Sections 2, 78, 79, 80, 87, 124A and 176,
it imposed a prohibition on any game, including games
of skill, when played for stakes in cyberspace, directly
targeting online rummy, poker and daily fantasy sports.
150. Consequently, the Karnataka High Court’s judgment dated
14.02.2022 correctly:
a) Held that applying the “evil test” (focusing only on
perceived social evil) to ban all online games of skill
amounts to “throwing the baby with the bath water” and
is impermissible;
b) Rejected any functional distinction between physical
and online formats that would convert games of skill
into games of chance merely due to digitisation; the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 68 of 269
decision in MJ Sivani (supra) was confined to specific
facts of tampering and cannot override RMDC (supra)
and K.R. Lakshmanan (supra) ;
c) Held that the State’s creation of a “medium ‑ based”
prohibition on online games of skill tramples the
permissible limits of restriction on business activities
protected by Article 19(1)(g).
151. As regards legislative competence, the Karnataka High Court
correctly concluded that:
a) Games of skill are business activities protected under
Article 19(1)(g), as recognised in RMDC-II (supra) ;
b) Regulation of games of skill lies under Entry 26 List II
(trade and commerce), not under Entry 34 (“betting and
gambling”);
c) Recourse to Entry 1 (public order) and Entry 2 (police)
is unjustified because an activity that is not res extra
commercium cannot intrinsically generate a public order
issue merely by being online.
152. The TN Online Gambling Act 2022/23 is also
unconstitutional in part because:
a) Sections 2(i), 2(j), 2(l) read with Sections 7-10 and 23
and the Schedule presumptively classify rummy and
CA Nos. 6124-6131 of 2023 & Connected Matters Page 69 of 269
poker as “online games of chance” when played for
money, despite consistent judicial recognition of these
games as games of skill;
b) The law perversely permits physical rummy for money
while targeting the same game online, without cogent
justification.
153. The Madras High Court’s judgment dated 09.11.2023
correctly held that:
a) There is a consistent line of decisions of this Court and
the High Courts holding rummy and poker to be games
of skill. Consequently, a heavy burden lies on the State
to demonstrate how the online versions cease to be
games of skill, a burden which the State has not
discharged;
b) The inclusion of rummy and poker in the Schedule as
online games of chance is based merely on presumption,
is unreasonable and contrary to binding precedent, and
therefore the Schedule must be set aside;
c) Sections 2(i) and 2(l)(iv) must be read down so that they
apply only to games of chance, not to games of skill.
154. Entry 34 of List II (“betting and gambling”) is limited to
gambling on games of chance, and does not encompass
CA Nos. 6124-6131 of 2023 & Connected Matters Page 70 of 269
games of skill even when played for stakes because this
Court has consistently interpreted “betting and gambling” as
referring to betting or wagering on games of chance alone, in
RMDC-I (supra) , RMDC-II (supra) and K. R. Lakshmanan
(supra) . Further, competitions involving substantial skill are
business activities protected under Article 19(1)(g).
D.7. Submissions of Ld. Senior Counsel Mr. Abishek
Malhotra appearing on behalf of respondent No. 17
(Paavan Nanda) in C.A. Nos. 6132-6143 of 2023:
155. Unlike most States that prohibit only “games of chance”,
Karnataka has imposed a blanket ban on all games “played
for stakes”, including games involving skill, thereby
departing from the long ‑ standing national legislative policy
of treating games of skill differently from gambling.
156. This blanket prohibition violates the respondent’s
fundamental right to practice any profession or to carry on
any occupation, trade or business under Article 19(1)(g), and
also infringes his freedom of speech and expression under
Article 19(1)(a).
157. Jurisprudence under Article 19(1)(a) protects not only
speech and expression but also the medium through which
expression is conveyed. Reliance placed on decisions such
CA Nos. 6124-6131 of 2023 & Connected Matters Page 71 of 269
as in Indian Express v. Union of India and Tata Press
Ltd. v. MTNL reported in 1995 AIR 2438 , 1995 SCC (5)
139 , respectively, which recognise that freedom of the press
and commercial speech are integral aspects of Article
19(1)(a), and that the right covers both dissemination and
receipt of content, which applies equally to online games as
a medium of content.
158. Restrictions on speech are constitutionally permissible only
if they fall within the specific grounds in Article 19(2) and
qualify as “reasonable” in a qualitative, quantitative, and
contextual sense. They must be proportionate and cannot
amount to total prohibition. The TN Online Gambling Act
2022/23 by imposing a blanket ban on online games for
stakes, fails this test of reasonableness and proportionality.
159. The Karnataka High Court in AIGF ( supra ) has already held
that games involve psychology, behaviour, emotions, and
motivations, that they have artistic and recreational value,
and that games of skill fall within the protection of Articles
19(1)(a) and 21 (subject to reasonable regulation). The TN
Online Gambling Act 2022/23 ignores and contradicts this
binding reasoning.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 72 of 269
160. For over two centuries, Indian legislative policy has
consistently distinguished games of skill from “gambling”
and has purposefully excluded games of skill from gambling
legislation, as evidenced by nineteenth ‑ century enactments
and subsequent statutes that repeatedly preserve this
distinction.
161. “Betting and gambling” was incorporated into Entry 36 of
List II of the Government of India Act, 1935 and retained as
Entry 34 of List II of the Seventh Schedule to the
Constitution. The concept under this Entry is premised on
the staking of money or property, i.e. wagering or stake, as
the central element.
162. Even in games of skill, participants may choose to wager, but
wagering is neither indispensable nor inherent to the nature
of skill ‑ based contests. Therefore, skill games do not, by their
nature, fall within “betting and gambling” under Entry 34.
163. Under Article 246 read with Entry 34 of List II, State
legislatures are competent only in respect of the composite
activity of “betting and gambling”, which, by necessity and
design, excludes “mere games of skill”. The conjunctive
drafting (“betting and gambling”) is used for precision,
CA Nos. 6124-6131 of 2023 & Connected Matters Page 73 of 269
similar to other conjunctive expressions in the Constitution,
and does not permit the State to extend its competence to all
games involving stakes, regardless of their skill ‑ based
character.
164. Several States have adhered to this constitutional and
statutory understanding by maintaining a clear dichotomy
between games of chance and games of skill, as seen in the
Haryana Prevention of Public Gambling Act, 2025, which
defines “bet”, “betting”, “gambling”, “game of chance”, “game
of skill” and “gaming” so that gambling is confined to betting
on chance and games of skill are expressly excluded from
“gaming”.
165. Nagaland’s regime under the Nagaland Prohibition of
Gambling and Promotion and Regulation of Online Games of
Skill Act, 2015, similarly prohibits gambling but provides a
regulatory framework for online games of skill and expressly
defines “gambling”, “games of skill”, “games of chance” and
“wagering/betting” so as to exclude games of skill (including
those involving strategic selection or analysis) from the
category of gambling.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 74 of 269
166. The Madras High Court in Junglee Games ( supra ) held that
while the State has competence to legislate on betting and
gambling, the State cannot expand the field beyond the
scope of the Entry by including legitimate games of skill
within its prohibitory sweep, and that such expansion
amounts to usurpation of authority and reflects
unreasonableness and disproportionality.
167. In light of the foregoing, the TN Online Gambling Act
2022/23 attempt to subsume games of skill played for
stakes within “betting and gambling” is ultra vires Entry 34
of List II and constitutionally invalid.
D.8. Submissions of Ld. Counsel Mr. Badri Narayanan for
Play Games 24*7 in Civil Appeal 6132-6143 of 2023:
168. Gambling or lottery is a specific legal category which
necessarily requires the cumulative presence of three
elements: (a) prize, (b) chance, and (c) consideration. If any
one element is missing, the activity is not gambling or lottery.
169. This three ‑ element definition is the precise legal ( nomen juris )
conception of “lottery, gift enterprise, or similar scheme” and
has been expressly adopted by courts such as the US
Supreme Court in FCC v. American Broadcasting Co.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 75 of 269
reported in 347 U.S. 284 (1954) and the Supreme Court of
Alaska in State of Alaska v. Pinball Machines reported in
404 P.2d 923 .
170. The phrase “betting and gambling” in Entry 34, List II of the
Seventh Schedule to the Constitution (and its predecessors)
is not defined in the constitutional text or the Government of
India Act, 1935, and therefore must be construed according
to its precise legal meaning ( nomen juris ), and not in a loose,
popular sense.
171. By analogy to India’s federal structure, in the United States,
the primary power to regulate betting, gambling and lotteries
lies with the States, as recognized in Murphy v. NCAA
reported in 584 U.S. 453 [138 S. Ct. 1461] , where a federal
restriction on State authorization of sports betting was held
to violate the Tenth Amendment.
172. Within that federal scheme, both State and federal
enactments use the three ‑ element test of prize, chance and
consideration to identify and regulate gambling activities,
reinforcing the centrality of this test to the legal concept of
gambling.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 76 of 269
173. Among the three elements, “chance” is the basic, core
ingredient of gambling and lottery and constitutes the “evil
principle” which the law condemns, without which the
activity is not lottery or gambling.
174. Decisions such as City of Wink v. Griffith Amusement
reported in 100 S.W.2d 695 (1936) describe “chance” as the
very basis of the “lottery principle”. Schemes which lack
operative chance fall outside the constitutional and statutory
condemnation of lotteries and gambling even if other
elements are present. Where chance is wholly absent, the
activity cannot be equated with gambling or lottery in law.
175. Betting or wagering, in law, is not every agreement about an
uncertain event. It refers to staking on an uncertain future
event beyond the control of the parties, where the outcome
of that event decides who wins and who loses.
176. Consequently, betting is grouped with gambling and lottery
only where chance forms the basis of prize distribution. If
the underlying activity is one of predominant skill, it does
not become gambling merely because betting occurs on its
outcome.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 77 of 269
177. The submissions adopt the test articulated by this Court in
the RMDC line of cases, namely that the distinction between
a “game of chance” and a “game of skill” turns on whether
chance or skill predominates in determining the result.
178. Wagering on the outcome of a game does not alter the
inherent character of that game. If the underlying game is
one of skill, it remains a game of skill even when played for
stakes or when bets are placed upon its result.
179. The contention that “once there is betting, all games become
gambling” is liable to be rejected on the basis of the
concurring opinion in Utah State Fair Assn v. Green ,
which reasons that betting or the method of betting
(including pari ‑ mutuel systems) does not determine whether
the game itself is one of chance or skill. Games such as
football, baseball or horse ‑ racing remain games of skill
irrespective of wagering on their outcomes.
180. Since betting or wagering does not determine or affect how
the game is played or who wins, the character of the game is
not changed merely because stakes are involved. Therefore,
betting on a game of skill does not convert that game into
“gambling”.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 78 of 269
181. The decision in Rohan v. Detroit Racing Assn. reported in
314 Mich. 326 (1946) , similarly holds that wagering on the
outcome of inherently skill ‑ based activities does not
transform them into games of chance, reinforcing the above
contention. It is therefore incorrect to assert that playing a
game of skill “for stakes” renders it a game of chance or
“gambling”; the legal character of a game of skill is preserved
irrespective of the presence of stakes.
E. SUMMARY OF THE SUBMISSIONS CANVASSED ON
BEHALF OF THE RESPONDENTS
182. The learned counsel appearing for the in this batch of
petitions have consistently submitted that treating games of
skill as res extra commercium when played for stakes is
contrary to the established jurisprudence in RMDC-I (supra),
RMDC-II (supra), and K. R. Lakshmanan (supra) . They all
have also collectively emphasized on the protection under
Article 19(1)(g).
183. Another common submission canvassed by Mr. Aryama
Sundaram and Mr. Mukul Rohatgi is on the regulation of
online gaming and FS to primarily lie within the exclusive
domain of the Parliament under Entries 31, 42, and 97 of
CA Nos. 6124-6131 of 2023 & Connected Matters Page 79 of 269
List I since State-wise prohibitions would yield regulatory
chaos.
184. However, regardless of the determination of whether the
power to regulate online gaming platforms should lie with
the Union or not, all learned counsel for the assessee have
categorically submitted that the States do not have the
legislative competence under Entry 34 of List II as it only
extends to “betting and gambling” in the sense of games of
chance and not games of skill.
185. In addition to these common submissions, some of the more
specific submissions that each of the learned counsels
appearing for the assessees in this case have made are as
follows:
E.1. Ld. Senior Counsel Mr. Abishek Manu Singhvi appearing
for respondent No.1 (Gameskraft) in C.A. Nos. 6132-
6143 of 2023, contended the following in the regulatory
batch:
186. The impugned Tamil Nadu and Karnataka amendments, and
the TN Online Gambling Act 2022/23 obliterate the settled
distinction between games of skill and games of chance by
defining “gaming” as playing online games for money or
stakes and by imposing a blanket ban on online rummy.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 80 of 269
187. Reliance placed on RMDC ‑ I (supra), RMDC ‑ II (supra) , and
K.R. Lakshmanan (supra) to contend that “betting and
gambling”, “gaming”, and “games of chance” exclude games
of skill. The presence of stakes or money does not change its
essential character or convert it into “betting and gambling”.
188. The disjunctive reading of Entry 34 as “betting or gambling”
is submitted to be flawed, as it would subsume games of skill
and is inconsistent with the Parliament’s own usage in
Section 65B(15) of the Finance Act, 1994 is cited to show
that “betting and gambling” denotes staking on
chance ‑ based outcomes and not skill-based outcomes.
189. The respondent company operates as an “online gaming
intermediary” within the meaning of the IT Rules charging a
fixed platform fee without wagering. Therefore, the platform
itself does not participate as a player or wager on game
outcomes.
E.2. Ld. Senior Counsel Mr. Aravind Datar appearing for
Head Digital Works in Civil Appeal No. 6124 of 2023,
submitted the following:
190. The 2021 Tamil Nadu and Karnataka legislations
criminalised all online games, skill and chance alike, by
CA Nos. 6124-6131 of 2023 & Connected Matters Page 81 of 269
removing the long-standing statutory exception for skill
games, and were correctly struck down.
191. Submissions with regards to the TN Online Gambling Act
2022/23 dealt with in SLP (C) Nos.1588-1592 of 2024 are
that though they were enacted to ostensible prohibit online
gambling and regulate online gaming, it in substance
proscribes games of skill such as rummy and poker by
deeming them games of chance through provisions including
Section 2(1), Section 7 and the Schedule.
192. Therefore, both the Madras High Court and the Karnataka
High Court have rightly applied long-standing Supreme
Court precedents on the distinction between games of skill
and games of chance, warranting no interference by this
Court in the present matter.
E.3. Ld. Senior Counsel Mr. Aryama Sundaram appearing
for the All India Gaming Federation in C.A. No. 6124 of
2023, contended the following:
193. A statute’s character as regulatory or prohibitory depends on
the nature of the act being targeted and whether it is res
extra commercium . Games of skill are not res extra
commercium . Treating games of skill as res extra commercium
when played for stakes is contrary to RMDC II (supra) and
CA Nos. 6124-6131 of 2023 & Connected Matters Page 82 of 269
K.R. Lakshmanan (supra) and impermissibly removes them
from Article 19(1)(g) protection.
194. The 2021 TN Amendment Act expands “common gambling
house” to include computers, computer systems, networks,
resources and communication devices, and criminalises
“wagering or betting in cyberspace”. Therefore, in pith and
substance, the enactment regulates online platforms and
intermediaries operating in cyberspace (provision of access,
transmission, modification of content) which is a subject
that is exclusively within the legislative domain of the
Parliament under the IT Act and Entry 31 List I.
195. Playing games of skill is also a leisure activity and a vocation
for many, constituting both a livelihood and a form of
expression. Therefore, in addition to Article 19(1)(g), it is also
protected by Article 19(1)(a), subject only to Article 19(2). The
TN Amendment Act (Sections 3A, 11) and 2021 Karnataka
Amendment Act (Sections 2(7), 78(1)(a)(vi)–(vii), 176) in effect
penalise staking on games of skill and thus directly restrict
protected expression and profession, requiring strict
justification under Articles 19(2) and 19(6).
CA Nos. 6124-6131 of 2023 & Connected Matters Page 83 of 269
E.4. Ld. Senior Counsel Mr. Mukul Rohtagi appearing for
respondent No. 18 (Federation of Indian Fantasy Sports)
in C.A. Nos. 6132-6143 of 2023, contended that:
196. It is contended that rummy, poker and Fantasy Sports (FS)
are predominantly skill ‑ based. FS, particularly so, because
it involves analytical team selection and outcomes based on
predefined statistical performance metrics. Entry fees are
stated to be bona fide participation charges into pre-declared
prize pools. Operators do not wager or share in winnings by
charging a base entry fee and hence FS does not constitute
“betting and gambling”.
197. Reference is made to United States jurisprudence and the
UIGEA, which exclude skill ‑ based fantasy contests from
gambling and have held that entry fees paid unconditionally
for participation in contests with guaranteed, pre-declared
prizes (in which the operator is not a contestant) are not bets
or wagers.
198. Reference is also drawn to Indian legislative history since
1822 that has consistently excluded games of skill from the
ambit of “gambling” and “betting”, confirming that skill-
based activities (including FS) fall outside “betting and
gambling”.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 84 of 269
199. Regulation of online gaming and FS is submitted to lie
primarily in the Union domain under Entries 31, 42 and 97,
given the cross ‑ border, internet ‑ based nature of such
platforms. State ‑ wise prohibitions would only yield
regulatory chaos.
E.5. Ld. Senior Counsel Mr. Neeraj Kishan Kaul contended
the following while appearing for respondent No. 2
(Galactus) in C.A. Nos. 6132-6143 of 2023:
200. The challenge is directed to the 2021 Karnataka Amendment
Act, which, read with its Statement of Objects and Reasons,
is said to impose a complete embargo on organising and
playing online games with stakes, covering skill as well as
chance.
201. It is contended that Entry 34 is a single composite
expression. Therefore, “betting” is not a distinct,
free ‑ standing subject but is conjunctively linked with
“gambling”, and the use of “and” (instead of “or”) shows
legislative intent to regulate betting only when it is integrally
connected with gambling activities. Since the impugned
amendments extend their operation to games of skill
(including online skill ‑ based formats with monetary stakes),
they travel beyond “betting and gambling” in Entry 34 and
CA Nos. 6124-6131 of 2023 & Connected Matters Page 85 of 269
therefore lie outside State legislative competence under
Article 246(3).
202. The amendment is violative of Article 14 for drawing no
constitutionally valid distinction between games of chance
(gambling in the proper sense) and games of skill (whether
or not played for stakes, including online skill ‑ based games),
by treating both categories identically, conflating games of
skill with gambling, and subjecting them to a common total
prohibition when played with stakes. There is no intelligible
differentia justifying the singling out of the online mode of
playing skill ‑ based games with stakes for a complete
embargo, particularly when the mischief sought to be
addressed is “gambling” and “menace of gaming”, and
skill ‑ based operators like MPL are demonstrably distinct in
character and operation. Thus, the legislation lacks rational
nexus to its stated objective
E.6. Ld. Senior Counsel Mr. Sajan Poovaya appearing for
Play Games 24x7 Ltd. and Junglee Games India Pvt. Ltd
in C.A. Nos. 6124-6131 of 2023, C.A. Nos. 6132-6143 of
2023 and SLP (C) Nos. 1588-1592 of 2024
203. The 2021 TN Amendment Act is assailed for expanding
“gaming” to cyberspace, introducing Section 3A to impose a
CA Nos. 6124-6131 of 2023 & Connected Matters Page 86 of 269
blanket prohibition on wagering or betting for rummy, poker
or any other game, and removing the exemption for games of
skill. In dealing with the same, the Madras High Court vide
judgment dated 03.08.2021 have correctly held that
organising or offering games of skill is protected under
Article 19(1)(g), the game itself attracting Article 19(1)(a),
Entry 34 must be read conjunctively, and the prohibition
fails the least intrusive measure test.
204. The 2021 Karnataka Amendment Act is similarly assailed for
criminalising staking on games of skill and imposing
prohibitions in cyberspace. The Karnataka High Court vide
judgment dated 14.02.2022 has rightly rejected
medium ‑ based distinctions and held the ban impermissible.
205. The TN Online Gambling Act 2022/23 is challenged insofar
as it presumptively classifies rummy and poker as online
games of chance while permitting physical rummy for
money. Again, the Madras High Court vide judgment dated
09.11.2023 has correctly set aside the Schedule and read
down definitions to apply only to chance ‑ based games.
206. Entry 34 of List II (“betting and gambling”) is limited to
gambling on games of chance, and does not encompass
CA Nos. 6124-6131 of 2023 & Connected Matters Page 87 of 269
games of skill even when played for stakes because this
Court has consistently interpreted “betting and gambling” as
referring to betting or wagering on games of chance alone, in
RMDC-I (supra) , RMDC-II (supra) and K.R. Lakshmanan
(supra) . Further, competitions involving substantial skill are
business activities protected under Article 19(1)(g).
E.7. Ld. Senior Counsel Mr. Abishek Malhotra appearing on
behalf of respondent No. 17 (Paavan Nanda) in C.A. Nos.
6132-6143 of 2023
207. It is submitted that Karnataka’s blanket ban on games
played for stakes, including skill games, violates Articles
19(1)(g) and 19(1)(a), as online games constitute expressive
content. Jurisprudence under Article 19(1)(a) protects not
only speech and expression but also the medium through
which expression is conveyed. Reliance placed on decisions
such as in Indian Express (supra) and Tata Press Ltd.
(supra), which recognise that freedom of the press and
commercial speech are integral aspects of Article 19(1)(a),
and that the right covers both dissemination and receipt of
content, which applies equally to online games as a medium
of content.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 88 of 269
208. Restrictions on speech are constitutionally permissible only
if they fall within the specific grounds in Article 19(2) and
qualify as “reasonable” in a qualitative, quantitative, and
contextual sense. They must be proportionate and cannot
amount to total prohibition. The TN Online Gambling Act
2022/23, by imposing a blanket ban on online games for
stakes, fails this test of reasonableness and proportionality.
209. Further, under Article 246 read with Entry 34 of List II, State
legislatures are competent only in respect of the composite
activity of “betting and gambling”, which, by necessity and
design, excludes “mere games of skill”. The conjunctive
drafting (“betting and gambling”) is used for precision,
similar to other conjunctive expressions in the Constitution,
and does not permit the State to extend its competence to all
games involving stakes, regardless of their skill ‑ based
character.
E.8. Ld. Counsel Mr. Badri Narayanan made the following
submissions:
210. The submission proceeds on the three ‑ element conception of
gambling/lottery, which includes (a) prize, (b) chance and (c)
consideration, contending that absence of “chance” excludes
the activity from gambling. “Betting” is staking on uncertain
CA Nos. 6124-6131 of 2023 & Connected Matters Page 89 of 269
future events beyond parties’ control and only grouped with
gambling where chance forms the basis of prize distribution.
211. Adopting the RMDC test, wagering on the outcome of a skill
game does not alter its inherent character; skill games
remain skill ‑ based notwithstanding stakes.
212. Reliance placed on several United States judgments, for its
analogy to India’s federal structure, to reject the proposition
that “once there is betting, all games become gambling”, and
to affirm that wagering on skill-based activities does not
transform them into games of chance.
213. Since betting or wagering does not determine or affect how
the game is played or who wins, the character of the game is
not changed merely because stakes are involved. Therefore,
betting on a game of skill does not convert that game into
“gambling”. It is therefore incorrect to assert that playing a
game of skill “for stakes” renders it a game of chance or
“gambling”; the legal character of a game of skill is preserved
irrespective of the presence of stakes.
F. ISSUES FOR CONSIDERATION
CA Nos. 6124-6131 of 2023 & Connected Matters Page 90 of 269
214. Having heard the learned counsel appearing for the parties
and having gone through the materials on record, the
following questions fall for our consideration:
(i) Whether the conjunction “and” appearing in the
expression “betting and gambling” in Entry 34 of the List
II of the Seventh Schedule to the Constitution is to be
interpreted to mean that the competence of the State
Legislature extends only to betting on gambling
activities? In other words, whether betting on games of
pure skill falls outside the purview of the legislative
competence of the State Legislature under the said
entry?
(ii) Whether the two impugned state legislations failed to
correctly infer and apply the decisions of this Court in
RMDC-I (supra) , RMDC-II (supra) and K.R.
Lakshmanan (supra) , respectively?
(iii) Whether the two impugned state legislations are
manifestly arbitrary insofar as they treat both the games
of skill and games of chance in the same manner?
(iv) Whether the two impugned state legislations, by
imposing a blanket prohibition on online games with
stakes, failed to adopt the least intrusive measure for
regulation of the online gaming activities and entities,
CA Nos. 6124-6131 of 2023 & Connected Matters Page 91 of 269
and as such could be said to be constitutionally invalid
for being disproportionate?
(v) Whether the decision of the State Legislatures to
regulate and prohibit online gaming with stakes by way
of the impugned legislations is supported by any
empirical finding or research?
(vi) Whether the expression “gaming” could be said to have
acquired the status of nomen juris and as such includes
only games of chance and excludes games involving
substantial skill?
(vii) Whether there is any rational nexus between the
decision of the State Legislature to prohibit the playing
of online games with stakes and the object sought to be
achieved by the State Governments?
(viii) Whether the competence of the State Legislature in
passing the impugned legislations is to be derived solely
from Entry 34 List II, or other entries like “public order”,
“police”, “public health”, etc. also empower the State
Legislation to pass the impugned legislations?
G. ANALYSIS
I. Scope of Entry 34 in List II of the Seventh Schedule to
the Constitution
CA Nos. 6124-6131 of 2023 & Connected Matters Page 92 of 269
215. The prime object behind the enactment of the Public
Gambling Act almost one and a half centuries back, was to
curb the rise of public gambling houses. At that point of time,
the Legislature had taken a policy decision to not apply the
penal provisions of the Act to games of mere skill. With an
exploding boom in the use of information technology and
widespread accessibility to cyberspace, every mobile phone
has the potential to be a virtual gambling space. Therefore,
the States of Karnataka and Tamil Nadu respectively in lieu
of the aforesaid change in technological landscape, enacted
a statute that factors in online gaming and also prevent
financial losses in the form of gambling debts that arise from
betting and gambling on games of skill as well, besides
creating widespread addiction among the masses, specially
the younger population.
216. The High Court of Karnataka in AIGF (supra) and the High
Court of Madras in Junglee Games (supra), respectively,
while interpreting Entry 34 List II and striking down the
legislations, rendered the following findings:
I. Findings in AIGF
“The two words namely “Betting” and “gambling” as
employed in Entry 34, List II have to be read
conjunctively to mean only betting on gambling
activities that fall within the legislative competence of
the State. To put it in a different way, the word “betting”
CA Nos. 6124-6131 of 2023 & Connected Matters Page 93 of 269
employed in this Entry takes its colour from the
companion word “gambling”. Thus, it is betting in
relation to gambling as distinguished from betting that
does not depend on skill that can be regulated by State
legislation; the expression “gambling” by its very
nature excludes skill. It is chance that pervasively
animates it. This interpretation of the said Entry gains
support from the six decade old CHAMARBAUGWALA
jurisprudence.”
II. Findings in Junglee Games
118.
“ It is in such light that “Betting and gambling” in
Entry 34 of the State List has to be seen, where betting
cannot be divorced from gambling and treated as an
additional field for the State to legislate on, apart from
the betting involved in gambling. Since gambling is
judicially defined, the betting that the State can
legislate on has to be the betting pertaining to gambling;
ergo, betting only on games of chance. At any rate, even
otherwise, the judgments in the two Chamarbaugwala
cases and in K.R. Lakshmanan also instruct that the
concept of betting in the Entry cannot cover games of
skill. Although the State could contend with some
degree of justification that its legislative competence
extends beyond Entry 34 by drawing on, for instance,
Entries 1, 26 or 33, in such event, the State should have
discharged the burden of establishing proportionality.
For reasons detailed in preceding paragraphs, by
imposing a wide-ranging blanket ban, the State has
completely failed to meet the “least intrusive” measure
test and, therefore, the impugned amendment falls foul
of Article 19(1)(g) of the Constitution.”
217. The first question that needs to be addressed before
proceeding forward pertains to the principal argument
canvassed on behalf of the Online Gaming Companies as
well as the findings of the High Courts of Karnataka and
Madras respectively, that the scope of Entry 34 List II is
limited to games of chance alone. We are of the view that the
said finding returned by the High Courts in the impugned
CA Nos. 6124-6131 of 2023 & Connected Matters Page 94 of 269
judgments deserves to be set aside, for the following reasons,
each of which will be dealt with in some detail in the
subsequent parts of this judgment:
a) Intent of the Constituent Assembly, as can be discerned
from a reading of the Constituent Assembly Debates
suggests that the Constitution-makers did not intend to
restrict the scope of Entry 34 to games of chance alone.
b) The consistent legal position as has been propounded
by several decisions of this Court suggests that entries
in the Seventh Schedule have to be interpreted liberally,
so as to confer wide jurisdiction on the Legislature.
c) The decisions of this Court in the two RMDC cases did
not decide the scope of the expression “betting and
gambling” appearing in Entry 34 but was concerned
with a very different factual situation.
d) The decision of this Court in K.R. Lakshmanan (supra)
was passed in the unique facts of the case in that case
and does not interpret the scope of Entry 34.
II. Constituent Assembly Debates on Entry 34 List II
218. The present Entry 34 List II was Entry 45 List II before the
Constituent Assembly. The present Entry 33, which deals
CA Nos. 6124-6131 of 2023 & Connected Matters Page 95 of 269
with “theatres and dramatic performances; cinemas, subject
to Entry 60 of List I; sports, entertainments and
amusements” was Entry 44 before the Constituent
Assembly, though in a different form. It would be appropriate
that any discussion on Entry 45 before the Constituent
Assembly must emanate after examining Entry 44 because
of what had transpired during the Constituent Assembly
Debates. For the sake of conciseness, we have summarized
the manner in which the debates unfolded, extracting only
those portions that are of direct relevance to the issue at
hand.
219. On 02.09.1949, the following transpired before the
Constituent Assembly:
a) Shri T.T. Krishnamachari moved a motion to amend
Entry 44 to include “entertainments and amusements”
as part of the entry.
b) Shri H.V. Kamath raised an objection to such inclusion
on the ground that the Government was trying to
arrogate to itself far more powers to interfere with the
lives of citizens and referred to a Report in the Bombay
papers that the Government was trying to ban a
CA Nos. 6124-6131 of 2023 & Connected Matters Page 96 of 269
harmless game like rummy. The relevant extract is as
follows:
“I feel, Sir, that by including 'entertainments and
amusements' in this entry - they were not there
in the original draft - the Government are trying
to arrogate to themselves far more powers to
interfere with the lives of citizens than are
necessary. The other day there was a report in
the Bombay papers that that Government was
trying to ban even a harmless game like rummy.
I think that entertainments of this kind at least
must be kept beyond the purview of
Government.”
c) In response to the objection, Shri T.T. Krishnamachari
stated that this aspect of the matter comes in as Entry
45 in the List, for which Shri H.V. Kamath elaborated
on the nature of the objection.
d) While addressing the action of the Bombay Government
mentioned by Shri H.V. Kamath, Shri T.T.
Krishnamachari explained that the recent Order of the
Bombay Government was to stop the play of rummy
because of the stakes involved. It was further stated that
when people play the game for such high stakes, it takes
the form of gambling, and it was for that reason that
powers were available under Entry 45 to prohibit
playing of Rummy for money. The relevant extract is as
follows:
CA Nos. 6124-6131 of 2023 & Connected Matters Page 97 of 269
“Sir, I appreciate what my honourable Friend
Mr. Kamath has said in regard to undue
interference by the State in the activities of
private persons in Clubs and other places, but I
do not think that this entry relates to that matter
at all. What it really relates to is a certain
amount of control which the States should have
over places of public resort for purposes of
health, morality and public order. These three
matters of the State will have to safeguard in
places of public resort. What my friend
contemplates to do should be done under the
powers conferred by the next item 45. The recent
order of the Bombay Government is to stop the
play of rummy because of the stakes involved.
The people that play this game for such high
stakes that it takes the form gambling, and it is
for that reason that under the powers that the
Bombay Government have under entry 45 they
have sought to prohibit the playing of rummy for
money. I do not think that this particular entry
under discussion will be abused by any State
Government to unduly restrict any pleasures or
diversions that people have. The purpose of this
entry is entirely different.”
(Emphasis Supplied)
e) It was assured by Shri T.T. Krishnamachari that Entry
44, by including entertainments and amusements, will
not be abused by any State Government to unduly
restrict any pleasures or diversions that people have.
220. What becomes clear from the above is that the founding
Fathers of the Constitution clearly intended even Rummy, a
Game of Skill, to be regulated and even be prohibited, when
played with Stakes, by virtue of powers under the erstwhile
Entry 45 before the Constituent Assembly and which is
CA Nos. 6124-6131 of 2023 & Connected Matters Page 98 of 269
th
Entry 34 of List II at present in the 7 Schedule of the
Constitution of India. A clearer intention of our makers of
the Constitution cannot be derived from any other source. In
fact, when one examines the discussion under Entry 45 that
immediately followed the discussion under Entry 44, this
position is only strengthened.
221. The following comes to light after an examination of the
Constituent Assembly Debates on Entry 45 List II, as it then
stood, on 02.09.1949:
a) Shri Shiban Lal Saksena moved a motion to delete the
entry “betting and gambling” on the ground that it would
be legalized by the entry and substantiated by stating
that it goes against the principles to which the
Constituent Assembly is committed.
b) Shri Lakshminarayan Sahu supported the deletion and
even stated that the entry encourages betting and
gambling and taxation on such items does not appear to
be proper.
c) To the above objections, the following was stated by Dr.
B.R. Ambedkar immediately after which the idea of
deleting the entry was dropped and the Entry was
adopted as part of our Constitution:
CA Nos. 6124-6131 of 2023 & Connected Matters Page 99 of 269
“Sir, I am very much afraid that both my friends,
Mr. Shibban Lal and Mr. Sahu, have entirely
misunderstood the purport of this entry 45 and
they are further under a great misapprehension
that if this entry was omitted, there would be no
betting or gambling in the country at all. I should
like to submit to them that if this entry was
omitted, there would be absolutely no control of
betting and gambling at all, because if entry 45
was there it may either be used for the purpose
of permitting betting and gambling or it may be
used for the purpose of prohibiting them. If this
entry is not there, the provincial
governments would be absolutely helpless
in the matter . I hope that they will realise what
they are doing. If this entry was omitted, the
other consequence would be that this subject
will be automatically transferred to List I under
entry 91. The result will be the same, viz. the
Central Government may either permit gambling
or prohibit gambling. The question therefore that
arises is this whether this entry should remain
here or should be omitted here and go
specifically as a specified item in List I or be
deemed to be included in entry 91. If my friends
are keen that there should be no betting and
gambling, then the proper thing would be to
introduce an article in the Constitution itself
making betting and gambling a crime, not to be
tolerated by the State. As it is, it is a preventive
thing and the State will have full power to
prohibit gambling. I hope that with this
explanation they will withdraw their objection to
this entry.”
(Emphasis Supplied)
222. In short, what becomes apparent is that our founding fathers
intended Betting and Gambling to be regulated and left it to
the States to determine whether to permit them or prohibit
them. While doing so, it was also categorically made clear
that playing even skill-based games of rummy for money
CA Nos. 6124-6131 of 2023 & Connected Matters Page 100 of 269
would tantamount to gambling, and the same would fall
within the regulatory powers of Entry 34 List II, as it stands
now. To shrink this Entry and limit it to regulate only games
of chance, and to completely obliterate the significance of
stakes from the purport of the entry, would not only violate
the express scope of the entry but also the wisdom, intention
and vision of our founding fathers.
223. The finding of the High Court of Madras as well as the High
Court of Karnataka, respectively, that gives a narrow
interpretation of the Entry, has failed to take into account
the power intended to be bestowed upon the States under
the Entry by the framers of the Constitution, and as such
has rendered them powerless to prohibit the activity of
betting and gambling. The extracts reproduced above
indicate that Dr. B.R. Ambedkar was sceptical about the very
same thing happening, which prompted him to push for the
Entry to be included as part of the 7th Schedule. Despite the
existence of such an entry, the State of Karnataka and Tamil
Nadu continue to be powerless to regulate betting and
gambling on games of skill in cyberspace in lieu of the
judgments in AIGF (supra) and Junglee Games (supra) .
CA Nos. 6124-6131 of 2023 & Connected Matters Page 101 of 269
224. The speech of Dr. Ambedkar in the Assembly clearly
indicates that the intent behind the inclusion of the entry
was to leave it to the wisdom of the State Legislatures the
question and manner of regulation of betting and gambling
activities. Thus, even if a State had followed a different
approach towards regulation of betting and gambling for
years, it would be open for it to change the approach to
increase the regulation, or even prohibit certain betting and
gambling enterprises, if a need to do so is felt.
III. Entries in the Seventh Schedule must receive broad
and liberal interpretation
225. The Entries under Schedule 7 of the Constitution of India
have been drafted to be as broad, expansive and wide as
possible. A few of these entries are reproduced below for the
purpose of illustration.
List I
Entry 15- War and peace
Entry 42- Inter-State trade and commerce
Entry 48- Stock exchanges and futures markets
List II
Entry 6- Public health and sanitation; hospitals and
dispensaries.
Entry 25- Gas and gas-works.
Entry 28- Markets and fairs.
Entry 31- Inns and inn-keepers
CA Nos. 6124-6131 of 2023 & Connected Matters Page 102 of 269
List III
Entry 9- Bankruptcy and Insolvency
Entry 10- Trust and trustees
Entry 20- Economic and social planning
Entry 20A- Population Control and family planning
Entry 23- Social security and social insurance;
employment and unemployment.
226. If the word “and” mentioned in all these entries are to be read
as “on”, by adopting an interpretive approach similar to the
one adopted by the High Court of Karnataka and Madras
respectively, it would shrink and limit the legislative scope of
the Parliament as well as the State Legislature. We are afraid
that an approach will not only militate against the
fundamental principles of statutory interpretation but will
also directly be violative of the law laid down by this Court
in the following judgments.
227. The 9-Judge Bench of this Court, in Lalta Prasad Vaish
(supra) , vide paras 57 and 85 respectively held as follows:
“57. The scope of Entry 8 must be interpreted in this
background. If Entry 8 is a product-based Entry, it will
only cover the consumable end-product. However, if it
is an industry-based Entry, it would cover the
production of the product as well. (See Tika Ramji v.
State of UP, AIR 1956 SC 676) Entries 24, 26 and 27 of
List II are general entries relating to industry and the
products of the industries. A distinction between
industry and product is made in List II to give effect to
the legislative scheme by which certain industries may
be controlled by the Union under Entry 52 of List I but
products of those industries which are placed in the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 103 of 269
Concurrent list under Entry 33. To give effect to this
unique demarcation, it was necessary to separate the
entries relating to industries and products in List II.
However, Entry 8 is a specific entry dealing only with
‘intoxicating liquor’. The distinction made between
industry and products in the general entries to give
effect to the scheme of legislative distribution on
industries is not adopted in Entry 8. We have in the
preceding sections emphasised that the primary
principle of interpreting entries in the legislative
lists is to provide a wide meaning to them. A
narrow interpretation must only be adopted when
either (a) the scope of the Entry is limited by the
use of language devices; or (b) a wide
interpretation creates an overlap between entries
within the same list or different lists. For
example, Entry 25 of List II provides States the
competence over “gas and gas-works”. This Court
in Calcutta Gas Company (supra) did not interpret
the Entry to only include the product of ‘gas and
gas works’ but rather interpreted it to include the
industry. This is the construction which is in
consonance with settled principles of
interpretation .
xxx xxx xxx
85. The judgment of this Court in Gannon
Dunkerley (supra) must be read in the context of the
settled principle of interpreting legislative
entries, that the entries must be conferred the
widest meaning possible
. Interpreting a phrase or
words in the Legislative Lists based on the legal import
of the phrase is, thus, in many ways an exception to
the settled principle of interpreting entries. This is for
the simple reason that the legislative entries delimit
the scope of competence of the legislative bodies.
If the entries are interpreted based on the meanings or
definitions in a legislation, the purpose of the Seventh
Schedule may become redundant. Further, the statute
does not define phrases based on popular or common
parlance meaning but rather based on the scope of the
legislation and the manner in which the provisions are
drafted. A deeming fiction is often used to define
phrases by conferring artificial meanings. (See
Ahmedabad Municipal Corporation v. GTL
Infrastructure Limited (2017) 3 SCC 545 [13] “13. “… it
CA Nos. 6124-6131 of 2023 & Connected Matters Page 104 of 269
would be self-defeating to understand the meaning and
scope of Entry 49 of List II by reference to the definition
clauses in the Gujarat Act. Definitions contained in the
statute may at times be broad and expansive; beyond
the natural meaning of the words or may even contain
deeming provisions. Though the wide meaning that
may be ascribed to a particular expression by the
definition in a statute will have to be given effect to, if
the statute is otherwise found to be valid, it will, indeed,
be a contradiction in terms to test the validity of the
statute on the touchstone of it being within the
legislative entry, by a reference to the definition
contained in the statute”) The interpretation based on
‘legislative meaning’ elucidated in Gannon
Dunkerley (supra), which narrows the interpretation of
entries, thereby creating an exception to the rule of wide
interpretation should only be employed by Courts when
the twin tests highlighted above. The tests are (a) the
phrase should have acquired a well-recognised,
definite and precise meaning in law; and (b) the legal
import of the word must be practically unanimous.
Additionally, we also are of the view that the legislative
meaning interpretation should be adopted only when
the deviation from the popular meaning of the phrase is
not too wide. The legislative meaning cannot be used to
artificially narrow legislative entries. We also deem it
necessary to note that we must be cognizant that the
standard of ‘legislative meaning’ is employed to
identify the ‘intent’ of the framers of
the Constitution and belongs to the originalist school of
thought, which has been consistently opposed by this
Court over the years. See Gannon Dunkerley (supra) :
“… Sales tax was not a subject which came into vogue
after the Government of India Act 1935. It was known
to the framers of that statute and they made express
provision for it under Entry 48.” For these reasons, the
principle of interpretation elucidated in Gannon
Dunkerley (supra) must be used cautiously by Courts.”
(Emphasis Supplied)
228. In Welfare Association v. Ranjit P. Gohil , reported in
(2003) 9 SCC 358 this Court held as follows:
CA Nos. 6124-6131 of 2023 & Connected Matters Page 105 of 269
“28. The fountain source of legislative power exercised
by Parliament or the State Legislatures is not Schedule
7; the fountain source is Article 246 and other
provisions of the Constitution. The function of the three
lists in the Seventh Schedule is merely to demarcate
legislative fields between Parliament and States and
not to confer any legislative power. The several entries
mentioned in the three lists are fields of legislation. The
Constitution-makers purposely used general and
comprehensive words having a wide import
without trying to particularize. Such construction
should be placed on the entries in the lists as
makes them effective; any construction which will
result in any of the entries being rendered futile
or otiose must be avoided. That interpretation has
invariably been countenanced by the
constitutional jurists, which gives the words used
in every entry the widest-possible amplitude.
Each general word employed in the entries has
been held to carry an extended meaning so as to
comprehend all ancillary and subsidiary matters
within the meaning of the entry so long as it can
be fairly accommodated subject to an overall
limitation that the courts cannot extend the field
of an entry to such an extent as to result in
inclusion of such matters as the framers of the
Constitution never intended to be included within
the scope of the entry or so as to transgress into
the field of another entry placed in another list. ”
(Emphasis Supplied)
IV. The decisions in RMDC-I ( supra ), RMDC-II ( supra ) and
K.R. Lakshmanan ( supra ) respectively
229. Substantial reliance has been placed by the Gaming
Companies on three decisions - the two RMDC cases and
K.R. Lakshmanan (supra) . These decisions were also
significantly considered by the High Courts in the respective
CA Nos. 6124-6131 of 2023 & Connected Matters Page 106 of 269
impugned judgments. Thus, we first deem it necessary to
trace the manner in which reliance on the said decisions was
placed by the High Courts, and thereafter we propose to
discuss our understanding of these decisions and whether
and to what extent they hold relevance in the instant case.
230. The High Court of Madras drew references to the RMDC
cases, and held that these cases laid down a determinative
test which separate gambling from other activities on the
basis of the existence of a ‘substantial degree of skill’. The
High Court also observed that the placement of “betting and
gambling” in Entry 34 of List II and the principle that
activities amounting to gambling are res extra commercium ,
and hence not protected under Article 19(1)(g), whereas the
activities involving substantial skill fall within the
constitutionally guaranteed protection. The relevant
paragraphs are as follows:
“23. The rummy petitioners first refer to the
two Chamarbaugwala cases decided by a Constitution
Bench and the distinction brought out therein between
a game of skill and a game of chance. In the first of the
two cases cited, reported at AIR 1957 SC 699 (State of
Bombay v. R.M.D. Chamarbaugwala), the issue
involved was the rationale of declining the renewal of a
licence to conduct a prize competition. The contention of
the State before the Supreme Court was that there
could be no business in promoting a prize competition
and the violation of the writ petitioners' rights under
CA Nos. 6124-6131 of 2023 & Connected Matters Page 107 of 269
Article 19(1)(g) of the Constitution did not arise. In the
discussion on the validity of the Amending Act of 1952
that was before the Supreme Court, such court noticed
that “Betting and gambling” as appearing in List-II in
the Seventh Schedule to the Constitution was there in
the Government of India Act, 1935. In the context of the
definition of “prize competition” that included any
competition in which the success did not depend to a
substantial degree upon the exercise of skill, the
Supreme Court referred to an English judgment that
opined that even if a scintilla of skill was required for
success the competition could not be regarded as of a
gambling nature, but toned down the dictum and
acknowledged that a game of substantial skill would
not amount to gambling. The Supreme Court agreed
with the proposition that “a competition in order to
avoid the stigma of gambling must depend to a
substantial degree upon the exercise of skill.” At
paragraph 17 of the report, the court went on to say
that a competition in which success does not depend to
a substantial degree upon the exercise of skill “is now
recognised to be of a gambling nature.”
24. In the other Chamarbaugwala case, reported
at AIR 1957 SC 628 (R.M.D. Chamarbaugwala v. Union
of India), there is a more wholesome discussion on the
skill versus chance aspect at paragraphs 3 to 6 of the
report. The court also noticed that in the
other Chamarbaugwala judgment it had held that
“trade and commerce protected by Article 19(1)(g) and
Article 301 are only those activities which could be
regarded as lawful trading activities, that gambling is
not trade but res extra commercium and that it does not
fall within the purview of those Articles.” Paragraph 5
of the report is of some relevance:
“5. As regards competitions which involve
substantial skill however, different
considerations arise. They are business
activities, the protection of which is guaranteed
by Article 19(1)(g) and the question would have
to be determined with reference to those
competitions whether Sections 4 and 5 and
Rules 11 and 12 are reasonable restrictions
enacted in public interest. But Mr. Seervai has
CA Nos. 6124-6131 of 2023 & Connected Matters Page 108 of 269
fairly conceded before us that on the materials
on record in these proceedings, he could not
maintain that the restrictions contained in those
provisions are saved by Article 19(6) as being
reasonable and in the public interest. The
ground being thus cleared, the only questions
that survive for our decision are (1) whether, on
the definition of “prize competition” in Section
2(d), the Act applies to competitions which
involve substantial skill and are not in the
nature of gambling; and (2) if it does, whether
the provisions of Sections 4 and 5 and Rules 11
and 12 which are, ex concessi void, as regards
such competitions, can on the principle of
severability be enforced against competitions
which are in the nature of gambling.”
25. At paragraph 10 of the report, the Supreme Court
recorded the State's submission that the impugned Act
in that case was relatable to Entry-34 in the State List.
However, on an overall appreciation of the legislation,
the court observed that by virtue of “the declared object
(of the Act) and the wording of the statute, we are of
opinion that the competitions which are sought to be
controlled and regulated by the Act are only those
competitions in which success does not depend to any
substantial degree on skill.” The principle is
summarised at paragraph 23 of the report:
“23. Applying these principles to the present Act,
it will not be questioned that competitions in
which success depends to a substantial extent
on skill and competitions in which it does not so
depend, form two distinct and separate
categories. The difference between the two
classes of competitions is as clear-cut as that
between commercial and wagering contracts.
On the facts, there might be difficulty in deciding
whether a given competition falls within one
category or not; but when its true character is
determined, it must fall either under the one or
the other. The distinction between the two
classes of competitions has long been
recognised in the legislative practice of both the
United Kingdom and this country and the courts
CA Nos. 6124-6131 of 2023 & Connected Matters Page 109 of 269
have, time and again, pointed out the
characteristic features which differentiate them.
And if we are now to ask ourselves the question,
would Parliament have enacted the law in
question if it had known that it would fail as
regards competitions involving skill, there can be
no doubt, having regard to the history of the
legislation, as to what our answer would be. Nor
does the restriction of the impugned provisions
to competitions of a gambling character affect
either the texture or the colour of the Act; nor do
the provisions require to be touched and re-
written before they could be applied to them.
They will squarely apply to them on their own
terms and in their true spirit and form a code
complete in themselves with reference to the
subject. The conclusion is therefore inescapable
that the impugned provisions, assuming that
they apply by virtue of the definition in Section
2(d) to all kinds of competitions, are severable in
their application to competitions in which
success does not depend to any substantial
extent on skill.”
xxx xxx xxx
48. The next set of petitioners, who are also mostly
involved in offering betting on rummy on their
platforms, seek to make a distinction between betting
and gambling. …
49. They refer to the Chamarbaugwala cases where
the use of skill has been seen to be permissible as a
business activity and entitled to protection under Article
19(1)(g) of the Constitution. They refer to the history of
the regulation of gaming and the prohibition in certain
areas before copiously referring to the judgment in K.R.
Lakshmanan.
xxx xxx xxx
57. Of the several petitioners who have challenged the
Amending Act, one is a federation or association of the
entities that provide games on the virtual platform or
cyberspace. …
(emphasis supplied)
xxx xxx xxx
64. These petitioners refer to the principles enunciated
in the Chamarbaugwala cases and specifically rely on
paragraph 20 of the report in K.R. Lakshmanan, where
CA Nos. 6124-6131 of 2023 & Connected Matters Page 110 of 269
the expression “mere skill” has been held to “mean
substantial degree or preponderance of skill.”
(Emphasis Supplied)
231. The High Court of Madras also drew reference from the
decision in K.R. Lakshmanan (supra) for its definition of
“mere skill”, which was held to mean “substantial degree or
preponderance of skill”. Relying on the decision in K.R.
Lakshmanan (supra) , the High Court went on to hold that
the protection under Article 19(1)(g) of the Constitution shall
be applicable to a game of skill that is distinct from a game
of chance, on the preponderance of the skill element
involved. The relevant observations made vide paragraphs
108 and 127 respectively are reproduced below:
“108. Since the discussion here has to be confined to
the validity of the impugned Amending Act, the several
tests enunciated in the authoritative judicial
pronouncements brought to bear on the subject by the
parties need to be understood and applied. For a
start, K.R. Lakshmanan instructs that when a game of
skill is distinct from a game of chance, on the
preponderance of the skill element involved, the activity
would be protected by Article 19(1)(g) of the
Constitution and competitions involving games of skill
have to be regarded as business activities.
xxx xxx xxx
127. At the same time, the Amending Act and the law
laid down on the subject in a plethora of judgments are
so inconsistent and irreconcilable that both cannot
stand together. Even the Law Commission's
recommendations stressed on regulation and not
prohibition. In the chit fund case of Narayana
Aiyangar that the State has relied on, the emphasis is
on the need for regulation in the interests of the public.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 111 of 269
There is no doubt that M.J. Sivani read the word
“gaming” in a wider sense when it observed that “a
game of pure chance or mixed chance and skill, it is
gaming”; but such dictum of a two-Judge Bench
rendered in 1995 must be seen to have been tempered
by the clear enunciation of the law in such regard in the
later judgment of K.R. Lakshmanan, rendered by a
three-Judge Bench, when it observed that gaming
would mean wagering or betting on games of chances
and it “would not include games of skill …”. Again, M.J.
Sivani upheld a legislation that the Supreme Court
described to be “to regulate running of the video
games”.
(Emphasis Supplied)
232. Drawing from both the RMDC cases and K.R. Lakshmanan
(supra) respectively, the High Court distilled the principle
that Entry 34 in List II of the Seventh Schedule to the
Constitution of India (dealing with “betting and gambling”)
has to be construed as ‘betting on gambling’ and is to be
confined to betting integral to gambling, i.e., betting only
upon games of chance and not games of skill. By doing so,
the High Court equated the term ‘gambling’ with games of
chance alone. It does not comprehend games of skill, which
are lawful commercial activities protected by Article 19(1)(g).
On that construction, it went on to hold that a blanket
proscription that indiscriminately sweeps in skill ‑ based
games cannot be sustained and that the amendment,
therefore, violates Article 19(1)(g).
CA Nos. 6124-6131 of 2023 & Connected Matters Page 112 of 269
233. In coming to this conclusion, the deductions from the RMDC
cases in the High Court’s view appear to be that the concept
of ‘betting’ in Entry 34 of List II cannot cover games of skill
because it cannot be divorced from gambling and treated as
an additional field for the State to legislate on, apart from the
betting involved in gambling. The observations at paragraph
125 of the judgment are reproduced below:
“125. It is in such light that “Betting and gambling” in
Entry 34 of the State List has to be seen, where betting
cannot be divorced from gambling and treated as an
additional field for the State to legislate on, apart from
the betting involved in gambling. Since gambling is
judicially defined, the betting that the State can
legislate on has to be the betting pertaining to
gambling; ergo, betting only on games of chance. At
any rate, even otherwise, the judgments in the
two Chamarbaugwala cases and in K.R.
Lakshmanan also instruct that the concept of betting in
the Entry cannot cover games of skill. Although the
State could contend with some degree of justification
that its legislative competence extends beyond Entry
34 by drawing on, for instance, Entries 1, 26 or 33, in
such event, the State should have discharged the
burden of establishing proportionality. For reasons
detailed in preceding paragraphs, by imposing a wide-
ranging blanket ban, the State has completely failed to
meet the “least intrusive” measure test and, therefore,
the impugned amendment falls foul of Article 19(1)(g) of
the Constitution.”
(Emphasis Supplied)
234. A Division Bench of the High Court of Karnataka in AIGF
(supra) , after having extensively discussed the two RMDC
cases, invalidated the impugned Acts on the basis that the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 113 of 269
wording of Entry 34 must be read conjunctively such that
“betting” derives its colour from “gambling”, thereby
confining the competence of the States to legislate only on
activities characterised by chance rather than skill. It also
went on to deduce from these decisions that a game that
involves a substantial amount of skill cannot be construed
as gambling. The relevant observations pertaining to the
RMDC decisions are made in the following paragraphs as
extracted below:
“IX. SCOPE OF ENTRY 34 IN STATE LIST;
CHAMARBAUGWALA JURISPRUDENCE; GAMES OF
SKILL v. GAMES OF CHANCE:
Learned advocates appearing for the petitioners
submitted that the term ‘Betting and gambling’
employed in Entry 34, List II having been treated as a
constitutional concept in CHAMARBAUGWALLA I &
II and in the cases that followed, as distinguished from
an ordinary legal concept this Court too has to construe
it accordingly. They contended that substantially the
Amendment Act being pari materia with the statutes of
other States, the approach of this Court to the matter
needs to be consistent with the relevant decisions of
several High Courts in the country. They also notified
that some of these have been affirmed by the Apex
Court on challenge. Justice Oliver Wendell Holmes
in TOWNE v. EISNER, had said “A word is not a
crystal, transparent and unchanged; it is the skin of a
living thought and may vary greatly in colour and
content according to the circumstances and time in
which it is used…”. The two words namely “Betting”
and “gambling” as employed in Entry 34, List II have
to be read conjunctively to mean only betting on
gambling activities that fall within the legislative
competence of the State. To put it in a different way, the
word “betting” employed in this Entry takes its colour
from the companion word “gambling”. Thus, it is betting
CA Nos. 6124-6131 of 2023 & Connected Matters Page 114 of 269
in relation to gambling as distinguished from betting
that does not depend on skill that can be regulated by
State legislation; the expression “gambling” by its very
nature excludes skill. It is chance that pervasively
animates it. This interpretation of the said Entry gains
support from the six decade
old CHAMARBAUGWALA jurisprudence, as discussed
below:
(i) In CHAMARBAUGWALA-I, supra the Apex
Court inter alia was considering whether the Bombay
Lotteries and Prize Competition Act, 1948, is a
legislation relatable to Entry 34, List II, i.e., “Betting
and gambling”. To answer this question, the definition
of “prize competition” in the said legislation was
examined with all its constituents & variants such as
“gambling prize competition”, “gambling adventure”,
“gambling nature” & “gambling competition”. After
undertaking this exercise, the Court observed:
“…On the language used in the definition section
of the 1939 Act as well as in the 1948 Act, as
originally enacted, there could be no doubt that
each of the five kinds of prize competitions
included in the first category to each of which
the qualifying clause applied was of a gambling
nature. Nor has it been questioned that the third
category, which comprised “any other
competition success in which does not depend to
a substantial degree upon the exercise of skill”,
constituted a gambling competition. At one time
the notion was that in order to be branded as
gambling the competition must be one success in
which depended entirely on chance. If even a
scintilla of skill was required for success the
competition could not be regarded as of a
gambling nature.
The Court of Appeal in the judgment under
appeal has shown how opinions have changed
since the earlier decisions were given and it is
not necessary for us to discuss the matter again.
It will suffice to say that we agree with the Court
of Appeal that a competition in order to avoid the
stigma of gambling must depend to a
substantial degree upon the exercise of skill.
Therefore, a competition success wherein does
not depend to a substantial degree upon the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 115 of 269
exercise of skill is now recognized to be of a
gambling nature.”
What emerges from the above observations is that :
gambling is something that does not depend to a
substantial degree upon the exercise of skill, and
therefore something which does depend, ought not to
be considered as gambling; as a logical conclusion, a
game that involves a substantial amount of skill is not
a gambling.
(ii) In R.M.D. CHAMARBAUGWALA-II, supra the Court
was treating the question, whether it was
constitutionally permissible for section 2(d) of the Prize
Competition Act, 1955, which defined “Prize
Competition” to take within its embrace not only the
competitions in which success depended on chance but
also those wherein success depended to a substantial
extent on the skill of player. What is observed
in CHAMARBAUGWALA-I becomes further clear by the
following observations in this case:
“… If the question whether the Act applies also
to prize competitions in which success depends
to a substantial degree on skill is to be
answered solely on a literal construction of s. 2
(d), it will be difficult to resist the contention of
the petitioners that it does. The definition of
‘prize competition’ in s. 2(d) is wide and
unqualified in its terms. There is nothing in the
working of it, which limits it to competitions in
which success does not depend to any
substantial extent on skill but on chance…that
competitions in which success depends to a
substantial extent on skill and competitions in
which it does not so depend, form two distinct
and separate categories … The distinction
between the two classes of competitions has
long been recognised in the legislative practice
of both the United Kingdom and this country,
and the Courts have, time and again, pointed
out the characteristic features which
differentiate them. And if we are now to ask
ourselves the question, would Parliament have
enacted the law in question if it had known that
it would fail as regards competitions involving
skill, there can be no doubt, having regard to the
history of the legislation, as to what our answer
CA Nos. 6124-6131 of 2023 & Connected Matters Page 116 of 269
would be … The conclusion is therefore
inescapable that the impugned provisions,
assuming that they apply by virtue of the
definition in s. 2(d) to all kinds of competitions,
are severable in their applications to
competitions in which success does not depend
to any substantial extent on skill…”
xxx xxx xxx
XIX. AS TO ARTICLE 19(1)(g) AND ENTRY 26
(TRADE AND COMMERCE) IN STATE LIST:
(a) The Apex Court while
considering CHAMARBAUGWALA-II, supra opined that
“…we find it difficult to accept the contention that those
activities which encourage a spirit of reckless
propensity for making easy gain by lot or chance, which
lead to the loss of the hard earned money of the
undiscerning and improvident common man and
thereby lower his standard of living and drive him into
a chronic state of indebtedness and eventually disrupt
the peace and happiness of his humble home could
possibly have been intended by our Constitution
makers to be raised to the status of trade, commerce or
intercourse and to be made the subject matter of a
fundamental right guaranteed by the Article 19(1)(g).”
It also reproduced the observation of the US Supreme
Court in UNITED
STATES v. KAHRIGER and LEWIS v. UNITED STATES:
“…there is no constitutional right to gambling…” In
view of the settled position of law, it hardly needs to be
stated that gambling, i.e., the ‘games of chance’ do not
enjoy any Constitutional protection since they are mala
in se. It is open to the legislature to absolutely prohibit
them as is done to the trades in noxious or dangerous
goods or trafficking in women. However, games of
skill by their very nature stand on a different footing.
xxx xxx xxx
(j) The Apex Court in INDIAN EXPRESS supra extended
protection to the Press with the following reasoning:
“…Newspaper industry enjoys two of the
fundamental rights, namely the freedom of
speech and expression guaranteed under Article
19(l)(a) and the freedom to engage in any
profession, occupation, trade, industry or
CA Nos. 6124-6131 of 2023 & Connected Matters Page 117 of 269
business guaranteed under Article 19(1)(g) of
the Constitution, the first because it is concerned
with the field of expression and communication
and the second because communication has
become an occupation or profession and
because there is on invasion of trade, business
and industry into that field where freedom of
expression is being exercised…”
The games of skill as we have reasoned out above
involve elements of expression and therefore enjoy
regulatable protection under Article 19(1)(a); it has long
been settled that these games apparently having
business characteristics are protected under Article
19(1)(g). Therefore the above observations in Indian
Express equally apply to the case of petitioners.
However, the Amendment Act does not critically adjust
the boundaries of existing category of protected
activities i.e., games of skill with the unprotected acts
of gambling. Instead, State has created a wholly new
category of medium-based-regulation when change of
medium per se does not alter the true nature & content
of the games. The permissible limits of restriction
recognized by Chamarbaugwalas are thus trampled,
by proscribing the online games by lock, stock &
barrel. To scuttle the ship is not to save the cargo : to
jettison may be.
(Emphasis Supplied)
235. Further, in dealing with the argument of the State that
advancements in science, technology, and online gaming
ecosystems had rendered the RMDC decisions obsolete, the
High Court underscored that the RMDC principles have been
repeatedly affirmed by this Court in decisions such as K.R.
Lakshmanan (supra) and several High Courts across the
country:
CA Nos. 6124-6131 of 2023 & Connected Matters Page 118 of 269
“XX. AS TO WHETHER CHAMARBAUGWALA
JURISPRUDENCE HAS LOST RELEVANCE DUE TO
ADVANCEMENT OF SCIENCE & TECHNOLOGY:
(a) Learned Advocate General appearing for the State
in his imitable style and vociferously contended that :
the provisions of an organic Constitution like ours have
to be construed keeping in view contemporary socio-
economic developments and the new challenges
associated with the same. There has been a paradigm
shift in the whole lot of activities in the society owing
to advancement of science & technology. New
implications and difficulties are cropping up in the
society justifying innovative ventures on the part of the
State to effectively manage them. A greater leverage
needs to be conceded to the State in devising
appropriate measures for curbing the menace of
online gaming. He passionately submitted that what
was true of things that happened in the bygone
decades i.e., when CHAMARBAUGWALAS were
decided, need to be examined afresh. In support of
this, he cites the decision in SIVANI supra contending
that the absolute embargo on videogames has been
upheld by the Apex Court, despite
CHAMARBAUGWALAS. He also refers to a Public
Interest Litigation in W.P. No. 13714/2020
between SHARADA D.R. v. STATE OF KARNATAKA in
which a direction was sought for banning of all forms
of online gambling and betting disposed off on
26.10.2021 by this Court, and that the Amendment
Act has been enacted keeping in view the same.
(b) We do appreciate the above submissions of the
learned Advocate General. However, that does not
much come to the rescue of respondents. True it is
: Constitution is intended to enure for ages to come
and consequently, to be adapted to the various crises
of human affairs. It is unwise to insist that what the
provisions of the constitution meant to the vision of its
makers must mean to the vision of our time. They
should be interpreted to meet and cover changing
conditions of social and economic life. A Constitution
states not rules for the passing hour but the principles
for an expanding future. At the same time, the
meaning of the Constitution does not change with
CA Nos. 6124-6131 of 2023 & Connected Matters Page 119 of 269
every ebb and flow of economic events. A constitution
is not a storehouse of fossilized principles. It is a living
law of the people and accordingly its provisions need
to be construed by all the organs of the State.
(c) However, the submission of learned Advocate
General overlooks one important factor:
CHAMARBAUGWALAS were decided decades ago is
true, but that jurisprudence has been validated time
and again by the Apex Court in K.R.
LAKSHMANAN(1996) and other subsequent cases.
Thus it is not that what was decided in
CHAMARBAUGWALAS is being re-visited for the first
time now. In the recent past, several High Courts in
the country have followed the same after critical
examination viz., VARUN GUMBER (P&H-2017),
GURDEEP SINGH (BOMBAY-2019), RAVINDRA SINGH
(RAJASTAN-2020), JUNGLEE GAMES (MADRAS-
2021), HEAD DIGITAL WORKS (KERALA-
2021), supra. Some of these cases went to Apex Court
and came to be affirmed, the latest being AVINASH
MEHROTRA, supra decided on 30.7.2021. All this is
already discussed at paragraphs (IX) & (X) above. We
need not refer to SIVANI again since it is already
discussed in detail infra. The PIL case does not in any
way come to the rescue of the respondents since the
prayer therein is related to banning of all online
gambling as such. Apparently, case of the petitioners
is not one of gambling; their business does not involve
any act which is determined by the wheel of fortune.”
(Emphasis Supplied)
236. The High Court of Karnataka made a reference to the
decision in K.R. Lakshmanan (supra) for its observations
on the scope of Entry 34 in List II and the distinction drawn
between a game of chance and a game of skill, echoing the
RMDC jurisprudence. The same is reproduced hereinbelow:
CA Nos. 6124-6131 of 2023 & Connected Matters Page 120 of 269
“IX. SCOPE OF ENTRY 34 IN STATE LIST;
CHAMARBAUGWALA JURISPRUDENCE; GAMES OF
SKILL v. GAMES OF CHANCE:
…
(iv) In K.R. Lakshmanan, a Three Judge Bench of the
Apex Court was examining the vires of amendments to
the Madras City Police Act, 1888 and the
Madras Gaming Act, 1940 whereby the exception
carved out for wagering on horse-racing from the
definition of “gaming” was deleted, much like the effect
of the Amendment Act herein which inter alia widens
the definition of “gaming” to include “wagering on
games of skill”, that hitherto enjoyed constitutional
protection. Having considered CHAMARBAUGWALAS-I
& II, K. SATYANARAYANA and some notable decisions
of foreign jurisdictions, the Court succinctly stated the
difference between a game of chance and a game of
skill, as under:
“3. The new Encyclopedia Britannica defines
gambling as “The betting or staking of
something of value, with consciousness of risk
and hope of gain on the outcome of a game, a
contest, or an uncertain event the result of which
may be determined by chance or accident or
have an unexpected result by reason of the
better's miscalculations”. According to Black's
Law Dictionary (Sixth Edition) “gambling
involves, not only chance, but a hope of gaining
something beyond the amount played. Gambling
consists of consideration, an element of chance
and a reward… Gambling in a nut-shell is
payment of a price for a chance to win a prize.
Games may be of chance, or of skill or of skill
and chance combined. A game of chance is
determined entirely or in part by lot or mere luck.
The throw of the dice, the turning of the wheel,
the shuffling of the cards, are all modes of
chance. In these games the result is wholly
uncertain and doubtful. No human mind knows
or can know what it will be until the dice is
thrown, the wheel stops its revolution or the
dealer has dealt with the cards. A game of skill,
on the other hand-although the element of
chance necessarily cannot be entirely
CA Nos. 6124-6131 of 2023 & Connected Matters Page 121 of 269
eliminated-is one in which success depends
principally upon the superior knowledge,
training, attention, experience and adroitness of
the player.”
“33. The expression ‘gaming’ in the two Acts has
to be interpreted in the light of the law laid-down
by this Court in the two Chamarbaugwala
cases, wherein it has been authoritatively held
that a competition which substantially depends
on skill is not gambling. Gaming is the act or
practice of gambling on a game of chance. It is
staking on chance where chance is the
controlling factor. ‘Gaming’ in the two Acts
would, therefore, mean wagering or betting on
games of chance. It would not include games of
skill like horse-racing. … We, therefore, hold that
wagering or betting on horse-racing - a game of
skill - does not come within the definition of
‘gaming’ under the two Acts. 34… Even if there
is wagering or betting with the Club it is on a
game of mere skill and as such it would not be
‘gaming’ under the two Acts.”
237. Further, the decision in K.R. Lakshmanan was also
(supra)
relied on to draw the conclusion that games of skill do not
metamorphise into games of chance merely because they are
played online. Consequently, it refused to agree with the
contentions of the Ld. Advocate General that gaming
includes both a ‘game of chance’ and a ‘game of skill’.
“XII. AS TO DIFFERENCE BETWEEN ACTUAL
GAMES & VIRTUAL GAMES, AND IF ALL ONLINE
GAMES ARE GAMES OF CHANCE:
The vehement contention of Learned Advocate General
that gaming includes both a ‘game of chance’ and a
‘game of skill’, and sometimes also a combination of
both, is not supported by his reliance on M.J
SIVANI v. STATE OF KARNATAKA34. We are not
CA Nos. 6124-6131 of 2023 & Connected Matters Page 122 of 269
convinced that M.J. SIVANI recognises a functional
difference between actual games and virtual games.
This case was decided on the basis of a wider
interpretation of the definition of ‘gaming’ in the context
of a legislation which was enacted to regulate the
running of video parlours and not banning of video
games; true it is that the Apex Court treated certain
video games as falling within the class of ‘games of
chance’ and not of ‘games of skill’. However, such a
conclusion was arrived at because of manipulation
potential of machines that was demonstrated by the
reports of a committee of senior police officers; this
report specifically stated about the tampering of video
game machines for eliminating the chance of winning.
This decision cannot be construed repugnant
to Chamarbaugwala jurisprudence as explained
in K.R. LAKSHMANAN. We are of a considered view
that the games of skill do not metamorphise into games
of chance merely because they are played
online, ceteris paribus. Thus, SIVANI is not the best
vehicle for drawing a distinction between actual games
and virtual games. What heavily weighed with the
Court in the said decision was the adverse police
report. It is pertinent to recall Lord Halsbury's
observation in QUINN v. LEATHAM: that a case is only
authority for what it actually decides in a given fact
matrix and not for a proposition that may seem to flow
logically from what is decided. This observation
received its imprimatur in STATE OF
ORISSA v. SUDHANSU SEKHAR MISRA.”
(Emphasis Supplied)
238. Finally, it relied on the classification of horse-racing as made
by the three-judge bench in K.R. Lakshmanan (supra) as
being ‘neither gaming nor gambling’ since it is a game of
mere skill to hold that the amended definition of ‘gaming’ in
the impugned Acts excludes lottery, wagering, betting on
horse-race run on any race course etc., and offends the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 123 of 269
clause of ‘equal protection of the laws’ as enshrined in Article
14 by being unjustifiably selective. The relevant observations
are as reproduced hereinbelow:
“XXI. AS TO DISCRIMINATION AND VIOLATION OF
EQUALITY UNDER ARTICLE 14:
(b) The amended definition of ‘gaming’ excludes in so
many words, ‘a lottery or wagering or betting on horse-
race run on any race course’ in a given circumstance.
The Apex Court in K.R. LAKSHMANAN supra held that,
horse-racing is a ‘game of mere skill’ and therefore, it
is ‘neither gaming nor gambling’. If the legislative
policy is to protect the games of skill from being treated
as proscribed, the Amendment Act being unjustifiably
selective in that suffers from a grave constitutional
infirmity. It offends the clause of ‘equal protection of the
laws’ enacted in Article 14, since protection is
unreasonably sectarian. The equal protection clause
would be diluted into a mild constitutional injunction
that the State shall treat as equal in law only the horse-
racers who are equal in fact with other players of
games of skill. For saving such a blatant
discrimination, the respondents have failed to establish
the reasonable basis on which such a classification is
founded and the rational nexus identifiable between
the differentia of and the object sought to be achieved
by such a classification vide STATE OF WEST
BENGAL v. ANWAR ALI SARKAR.”
(Emphasis Supplied)
239. In short, it appears that both the Madras High Court and the
Karnataka High Court respectively read the RMDC decisions
as a constitutional lodestar for the position that the
expression “betting and gambling” in Entry 34 of List II is to
be construed conjunctively and narrowly, such that “betting”
CA Nos. 6124-6131 of 2023 & Connected Matters Page 124 of 269
takes its colour from “gambling,” confining State competence
to betting integral to games of chance. By contrast, games
where success depends to a substantial degree on skill
constitute lawful business protected by Article 19(1)(g). In
light of the same, the statutes or blanket prohibitions that
oversee this skill-chance divide are overbroad,
disproportionate, and ultra vires to the extent they purport
to regulate or proscribe skill ‑ based activities.
240. The question that, therefore, arises for our consideration is
whether the interpretation of “betting and gambling” in Entry
34 of List II, as adopted by the respective High Courts by
placing reliance on the judgments in RMDC-I (supra) , RMDC-
II (supra) and K. R. Lakshmanan (supra) , can be construed
as ‘betting on gambling’. In other words, can the State’s
legislative competence under Entry 34 List II be confined
exclusively to betting on games of chance alone, thereby
rendering any prohibition or regulation of skill ‑ based games
played with stakes unconstitutional.
241. To address the contentions as canvassed, we must first try
to decipher what has been held in the aforesaid three
decisions, and more importantly, the context in which the
same has been held. What appears from a reading of the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 125 of 269
decision of this Court in RMDC–I (supra) is that the primary
issue which the Constitution Bench was confronted with was
as regards whether the 1952 Amendment to the Bombay
Lotteries and Prize Competitions Control and Tax Act, 1948
would also cover in its ambit “innocent prize competitions”.
Elaborately dealing with the scheme of the 1952 Amendment
Act, this Court observed that had the intention of the
legislature been to include “innocent prize competitions” in
the regulatory scheme of the 1948 Act, then the same would
have been done by prescribing a different, and less stringent,
set of regulations as compared to the ones prescribed for the
prize competitions which were of a gambling nature. The
reason assigned by the Court for the observation was that
while an innocent prize competition could be regulated
under Entry 60 of the State List, it would be difficult to hold
that it could be regulated under Entry 34 of the List II.
242. Further, what is evident from a reading of the aforesaid
decision is that the Court was interpreting the effect of the
amendment in the specific context of the legislative history
of the impugned legislation and also the definition of “prize
competition” enacted by the Legislature itself.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 126 of 269
243. Thus, what can be discerned from a reading of RMDC–I
(supra) is that first, innocent prize competitions were held to
be not covered by “betting and gambling” as appearing in
Entry 34 of the State List, and secondly, that such innocent
prize competitions may be regulated under Entry 60 of the
State List. What is further forthcoming from a reading of the
said decision is that illegitimate prize competitions may be
subject to taxation under Entry 62 of the State List.
244. However, the most pertinent observation made in the said
decision, which bears a direct relevance to the present case,
and directly covers the case before us, is the one which was
made by the Bench after the discussion on the afore-stated
aspects. The Court observed thus:
“20. A similar argument was sought to be raised on a
construction of clause (ii) of Section 2(1)(d). As already
stated, in between the first and the third categories of
prize competitions which, as already seen, are of a
gambling nature the definition has included a second
category of competitions in which prizes are offered for
forecasts of the results either of a future event or of a
past event the result of which is not yet ascertained or
not yet generally known. It is said that forecasts of
such events as are specified in the section need not
necessarily depend on chance, for it may be accurately
done by the exercise of knowledge and skill derived
from a close study of the statistics of similar events of
the past. It may be that expert statisticians may form
some idea of the result of an uncertain future event but
it is difficult to treat the invitation to the general public
to participate in these competitions as an invitation to a
game of skill. The ordinary common people who usually
CA Nos. 6124-6131 of 2023 & Connected Matters Page 127 of 269
join in these competitions can hardly be credited with
such abundance of statistical skill as will enable them,
by the application of their skill, to attain success. For
most, if not all, of them the forecast is nothing better
than a shot at a hidden target. Apart from the
unlikelihood that the Legislature in enacting a statute
tarring both lotteries and prize competitions with the
same brush as indicated by Section 3 would squeeze
in innocent prize competitions in between two
categories of purely gambling varieties of them, all the
considerations and difficulties we have adverted to in
connection with the construction of the first category
and the qualifying clause therein will apply mutatis
mutandis to the interpretation of this second clause.”
(Emphasis Supplied)
245. The extract reproduced above indicates that the Court in
RMDC-I (supra) considered as to whether events involving the
forecast of an uncertain future event, if dependent on
statistical skill, will amount to gambling or not. The Court
held that although some members of the general public who
are invited to such events may exercise statistical skill in
making an accurate forecast, yet most of the people could
hardly be attributed with such degree of statistical expertise.
The said observations of the Court show that it was not
oblivious of the reality wherein in the garb of skill, common
people would essentially be engaging in forecasting or betting
endeavors, and specifically observed that such betting
activities would not enjoy the constitutional protection under
Article 19(1)(g) and the possibility of some experts exercising
CA Nos. 6124-6131 of 2023 & Connected Matters Page 128 of 269
skill would not protect such activities from being declared as
res extra commercium . What is further discernible from the
said observations is that the Court was cognizant of the fact
that while games of skill may be excluded from the term
“gambling”, they would still be covered under the expression
“betting” as betting is nothing but staking money on the
outcome of a future uncertain outcome.
246. The case of rummy as well as fantasy sports companies
before us stands on a footing similar to the one that was
expressly considered and rejected by this Court in RMDC-I
(supra) . While the game of rummy substantially depends on
skill, betting on the outcome of a game of rummy is akin to
making a forecast on the outcome of an unknown future
event, and thus while in a limited number of cases an expert
may be able to make an accurate forecast by exercising
statistical skill, yet to say that on an open online platform,
where common masses play the game with stakes, the
nature of the game is anything but betting. Similarly, in the
case of fantasy sports, while an expert may make a
prediction with some degree of certainty, it is almost
common knowledge that the majority of people who
participate in such games do so on “gut feeling” rather than
CA Nos. 6124-6131 of 2023 & Connected Matters Page 129 of 269
on the basis of some mathematical knowledge. Even
otherwise, to say that the outcome of a game like cricket, for
example, which has innumerable variables that decide the
outcome of a given match, can be foreseen by a common
person, would be nothing but closing our eyes to the
practical reality that in the garb of making fantasy or dream
teams, the players are merely taking a shot at a hidden
target, merely in a more sophisticated manner, than a slot
machine or roulette.
247. We are not unmindful of the fact that when even the best AI
powered prediction models cannot predict with precision the
outcome of a cricket match, it would be too much to believe
that a common person may calculate, based on statistical
knowledge, the best combination of players who would be
the best 11 players to perform on a given day in a given
match.
248. It is further important to mention that there is no discussion
in the said decision as to what are the attributes of the
expression “betting” and also whether the legislative
competence of the State Legislature under Entry 34 is
limited to betting on gambling activities.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 130 of 269
249. Further, as regards the decision in RMDC–II (supra) , the key
expression in contention was “competitions which involve
substantial skill” and whether they would fall within the
regulatory purview of Entry 34 of List II.
250. The dispute that the court was resolving in RMDC–II (supra)
was as regards whether the Prize Competitions Act, 1955,
covered even competitions where substantial skill was
involved, and as such was void for legislative excess. The
Court observed that the impugned legislation was severable
and thus was valid to the extent it applied to prize
competitions of a gambling nature. It is important to
underscore that the Court never held that a game of
substantial skill played with stakes would be or not be
covered under the expression “betting and gambling”
appearing in Entry 34. To put it differently, it never fell for
consideration of the court as regards whether an event where
the uncertain outcome of an event was to be predicted would
be within the regulatory purview of Entry 34 or not.
251. Insofar as the decision in RMDC–II (supra) is concerned,
paragraph no. 9 of the report assumes great significance in
the context of the present case. The court observed therein
that competitions of a non-gambling nature were not in the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 131 of 269
mind of the State Legislatures when they resolved that the
Central Government should enact a uniform legislation for
regulating gambling competitions. It was further observed
therein that the competitions involving substantial skill “had
not done any harm to the public and had presented no
problems to the States, and at no time had there been any
legislation directed to regulating them”. The said observation
of the Court clearly indicates that the decision was not
curtailing the power of the State Legislature to legislate on a
game of skill, in the event a need was felt to do so but was
only deciding the dispute in the context of the legislative
history of the legislation impugned before it.
252. Further, what also follows as a natural corollary of the
aforesaid observations is that if games of substantial skill
are conducted in a manner that they start to pose problems
for the State or cause harm to the public, then the State will
not be powerless to regulate such games of substantial skill
as well. Such is the case in the present situation where
betting on games of skill is posing a threat to the State and
the well-being of the masses, and thus, even as per the
dictum in RMDC–II (supra) , the State Legislature cannot be
held to be powerless to regulate the same.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 132 of 269
253. The situation that the State of Karnataka and Madras
respectively faced at the time of enacting the impugned
legislation is starkly different from the situation that formed
the backdrop in the two RMDC cases. The statement of
objects of the impugned Acts indicates the widespread
problems being caused by the prevalence of online gaming
platforms allowing betting and gambling with real money at
stake. In such circumstances, the decision in RMDC–II
(supra) cannot be an impediment, as the decision dealt with
a factual scenario entirely different from the current one, and
also because the decision does not explain or curtail the
scope of the word “betting” appearing in Entry 34 List II.
254. It needs to be pointed out that the nature of legislation under
challenge before us is of a different nature. The legislations
impugned in the two RMDC cases never intended to regulate
betting on games of substantial skill. All that was sought to
be regulated there were situations wherein a participant
himself indulged in a game, success in which was not
substantially dependent on skill, and it was such regulation
which was challenged on the ground that the phrasing of the
legislation left scope for regulation of games of skill too,
CA Nos. 6124-6131 of 2023 & Connected Matters Page 133 of 269
which would be beyond the competence of the State
Legislature under Entry 34 of the List II.
255. The Court in the said decisions never had the occasion to
dwell upon the scope of the expression “betting and
gambling” as appearing in Entry 34 List II for the simple
reason that the factual situations in the said cases were
covered by the expression “gambling” inasmuch as the
games under consideration there were all where the
participant himself took a chance at the “hidden target”.
Thus, there was no requirement for the Court to consider the
scope of “betting” as it appears in the expression “betting and
gambling” and also the nature of the conjunction “and”
joining the two words.
256. As such, we find it difficult to hold that the decisions in the
two RMDC cases have taken away the power of the State
Legislature to regulate games of skill altogether. It is trite law
that the words of the legislature cannot be treated as mere
surplusage and some meaning and weight must be ascribed
to the words employed by the lawmakers while drafting the
legislation. This principle only assumes greater importance
when the words under consideration belong to a
foundational document like the Constitution itself, whose
CA Nos. 6124-6131 of 2023 & Connected Matters Page 134 of 269
draftsmen were none other than the founding fathers and
mothers of our nation.
257. While it may be true that games of skill may not get covered
by the expression “gambling”, it is not correct to say that
even “betting” on games of skill would be out of the
competence of the State Legislature to legislate upon.
258. We next turn our attention to the decision of this Court in
K.R. Lakshmanan (supra) . In the said decision, betting on
horse-racing was held not to be a game of chance and thus
entitled to the protection of Section 49 of the 1963 Police Act
and Section 11 of the 1930 Gaming Act. It is pertinent to
mention that the protection afforded to betting on horse-
racing in the said decision flowed from the protection
available to games of “mere skill” under the 1963 Police Act
and the 1930 Gaming Act. It was held by the Court that,
being a game of skill, wagering on horse-racing would not
amount to gambling. Thus, it was not the scope of the
expression “betting and gambling” as appearing in Entry 34
which was the subject matter of determination, rather, the
issue pertained to whether horse racing would be entitled to
the protection of the exception that the State Legislature had
itself carved out for games of “mere skill”.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 135 of 269
259. What follows from a reading of the decision as aforesaid is
that where the State Legislature, in its wisdom, has deemed
it appropriate to regulate games where monetary stakes are
involved, without affording any special protection to games
of mere skill, the decision in K.R. Lakshmanan (supra) will
not be of much avail. In the absence of Sections 11 and 49
of the 1930 Gaming Act and 1963 Police Act, respectively,
would the decision in K.R. Lakshmanan (supra) still be the
same? We find the answer to be a ‘No’.
260. We also take note of the observation made by the Australian
High Court in King v. Connara reported in 61 CLR 596 , to
the effect that whether an activity belongs to the category of
commerce or to the category of gaming/gambling, is a matter
of social opinion and not jurisprudence. The Constitution
makers, by enacting a broad entry 34 have left ample scope
for the State Legislatures to keep an eye on the efflux in
social opinion as regards these activities and codify the
regulations necessary to deal with a changing social order.
As we have already discussed, with the disruption caused by
the ushering of internet and mobile based gaming, the State
Legislatures cannot be forced to remain tethered to the
traditional understanding of gaming or gambling. It is also
CA Nos. 6124-6131 of 2023 & Connected Matters Page 136 of 269
evident that the decisions relied upon by the Petitioners,
were all rendered in specific factual scenarios, entirely
different from the one in hand. Moreover, the approach
adopted by this Court in all those decisions was to give true
meaning and effect to the intent of the Legislature, as was
forthcoming from the tone and tenor of those specific
legislations. However, in none of those decisions, has Entry
34 been interpreted to mean that the scope of the Entry
excludes activities pertaining to skill from its scope – and
while many of the State Legislatures deemed it appropriate
to create exceptions in favour of skill in the earlier
legislations, they cannot be held to be bound by what was
once the understanding of the concept, and which
understanding may not anymore align with the realities of
the modern, technology driven social life.
261. A reading of the decision in K.R. Lakshmanan (supra) also
indicates that the Court considered the manner in which the
Club operated and conducted the horse-races, as well as the
process by which betting happened. The observations of the
Court point out that the entire process of conducting races
and betting on them was highly regulated and organized,
which is very different from the uncertainty and veil of
CA Nos. 6124-6131 of 2023 & Connected Matters Page 137 of 269
invisibility associated with online gaming activities, whether
of skill or of chance.
262. Further, as a reading of paragraph no. 37 would make
evident, the Court held that wagering or betting on horse
racing, when it takes place within the premises of the Club
on the date when such a race is actually run on the turf of
the Club, would not be illegal. However, the Court
immediately added that betting at any place other than the
Club, like the streets or bazaars would not enjoy immunity.
Therefore, it appears that the idea of physical control and
regulation over the aspect of betting was a predominant
reason why the Court held betting inside the Club as being
legal. Such physical boundaries or possibility of control are
palpably missing from the online gaming landscape.
263. There is another aspect of the matter which requires some
consideration. The nature of the legislation impugned in the
two RMDC cases was such that the legislations were aimed
at regulating/taxing “prize competitions” wherein the
success of the participant did not substantially depend on
the skill of the participant. Similarly, in K.R. Lakshmanan
(supra) , this Court was called upon to adjudicate whether
betting on horse-racing could be prohibited by the legislation
CA Nos. 6124-6131 of 2023 & Connected Matters Page 138 of 269
impugned therein, which had a specific provision conferring
immunity to games of mere skill.
264. However, the situation in the present case is of a different
nature. The question is not that whether games of
substantial skill simpliciter can be prohibited by virtue of
Entry 34 List II. This much is settled that such games would
not amount to gambling and hence enjoy the protection of
Article 19(1)(g) of the Constitution. The question is that when
a player or third person places a bet on the uncertain
outcome of a game of skill, with the hope of earning an
amount more than he has staked, would such an act, which
indubitably amounts to betting, not be covered by the
expression “betting and gambling” used in Entry 34 and thus
be amenable to regulation by the State Legislature. In view
of the discussion as aforesaid, which indicates that even the
much relied upon decisions in the two RMDC cases left scope
for the State Legislature to regulate activities wherein the
uncertain outcome of a future event is to be forecasted.
265. Even in a game of skill, the outcome of the game being played
by multiple players is an uncertain future event, and even
with much exercise of skill, can never be predicted with
certainty. We would also like to observe that a game of skill,
CA Nos. 6124-6131 of 2023 & Connected Matters Page 139 of 269
played without stakes dependent on the outcome is very
different from a societal perspective as compared to a game
of skill played with stakes on the outcome of the game. The
former does not amount to betting or gambling, but the latter
amounts to betting, and thus falls within the purview of the
legislative powers of the State.
266. Having elaborately discussed the decisions in the two RMDC
cases and K.R. Lakshmanan (supra) , we shall now proceed
to analyse if the High Courts while passing the impugned
judgments, correctly applied the dictum to the factual
scenario before us. In other words, can the views of the
respective High Courts in this regard that ‘betting and
gambling’ by its very nature only pertains to games of chance
be sustainable in law?
267. We are not in agreement with the ratio evolved in AIGF
(supra) and Junglee Games (supra) respectively holding the
view that the Entry 34 in List II which reads as “betting and
gambling” should be read as “betting on gambling”.
268. This finding is a clear Constitutional aberration, tinkering
with the Constitution or actually rewriting the Constitutional
text which Courts are not entitled to do. The expression
CA Nos. 6124-6131 of 2023 & Connected Matters Page 140 of 269
betting and gambling is not strange, alien or unacceptable
expression, requiring a course correction through a Court
judgment. “Betting and gambling” is a common usage
expression across the world and across several legislation
within the country and outside. It is like usage of the
expression in common parlance “pipes and tubes”. “Betting
and gambling” is a set expression and the two terms in the
expression go with the flow. Both the High Courts erred
seriously in rendering a finding that Entry 34 List II should
be read as “betting on gambling” thereby meaning that only
betting on a game of chance would tantamount to gambling,
which can be regulated under the said Constitutional Entry
and through this interpretation, both the High Courts have
provided immunity to betting or putting stakes on game of
skill once and for all from the purview of Entry 34 List II.
269. Once it goes out of the Constitutional scheme and therefore
would remain unregulated is something which not only goes
against the teeth of various judgments but the underlying
Constitutional principle that betting on uncertain events
irrespective of the underlying game being a game of skill or
chance, would fall within the rigors of Entry 34 List II.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 141 of 269
270. When the uncertainty remains the same and the constant
factor in both these groups of games also remains the same,
an interpretation taking one out of the regulation and
retaining the other especially when the State Governments
of Karnataka and Tamil Nadu tracing their power to Entry
34 List II had removed the protection to stakes played on
games of skill, is an erroneous reading of Entry 34 of List II.
271. According to the High Courts, the act of staking would
constitute “betting” and only when such betting takes place
in relation to a gamble, i.e., taking a chance or in a chance-
based game, would the States be entitled to exercise their
legislative powers under Entry 34 List II. For the reasoning
of the High Court to be logically correct, it must be correct to
say that the element of gambling does not involve placing
any stakes. However, such a statement would be incorrect.
Both betting and gambling involve the aspect of staking.
Therefore, to eliminate the aspect of staking from the
element of gambling and attributing the aspect of staking
only to the expression betting is incorrect. In the absence of
staking, an activity can never constitute gambling. Merely
taking a chance without staking can never be a gamble. It is
CA Nos. 6124-6131 of 2023 & Connected Matters Page 142 of 269
placing money to win more money that forms the bedrock of
a gambling adventure.
272. The question that arises is what is then the difference
between the scope of the terms “betting” and “gambling”.
Both betting and gambling are interchangeable expressions.
They mean the same and are understood as an activity of
placing money on an uncertain and unknown outcome of
either an event or a sporting event or a random occurrence
or non-occurrence of anything.
273. The expression “betting and gambling” cannot be split to
mean that the staking angle alone would amount to betting
whereas the risk angle or the chance element would amount
to gamble. Both betting and gambling involve the aspect of
staking money on an uncertainty. Merely because the risk
element is commonly perceived as “taking a chance”, it
cannot mean an expression would cover only games of
chances. In both Rummy, a game of skill, and Teenpathi , a
game of chance, the persons staking on the uncertain
outcome, equally risk and “take a chance” on their unknown
and uncertain victory.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 143 of 269
274. The protection afforded to games of skill under Entry 34
cannot be construed as protection to betting on games of
skill, which essentially becomes a gambling enterprise. The
protection is to games of skill, where such games are to be
conducted not in a manner which essentially renders them
into gambling activities by allowing the players to bet on the
uncertain outcome of their victory.
275. As stated above RMDC-I (supra) neither dealt with a game of
skill nor with persons staking on games of skill. The only
ratio that can be deciphered from the ratio in RMDC-I (supra)
is that a prize competition, which is chance-based and is
played upon paying an entry fee, would constitute gambling
with the stake amount being the entry fee. What follows,
which is also the ratio in RMDC-I (supra) , is that any prize
competition or tournament which is skill based and is played
upon paying an entry fee would not constitute gambling.
Nothing more can be read into RMDC-I (supra) .
276. Therefore, to even remotely suggest that RMDC-I (supra) re-
casted Entry 34 List II from “betting and gambling” to
“betting on gambling” is incorrect, and such a finding
emanates from a misreading of RMDC-I ( supra ).
CA Nos. 6124-6131 of 2023 & Connected Matters Page 144 of 269
277. The sheet anchor of the online gaming companies’
submission is a far-fetched interpretation by interlocking a
couple of sentences in the judgments of this Court in RMDC-
I (supra) , RMDC-II (supra) , K.R. Lakshmanan (supra) and
Satyanarayana (supra), respectively, without examining
the underlying context.
278. The Online gaming companies have placed strong reliance
on the following findings rendered by the Constitution Bench
judgement in RMDC-I (supra) :
“At one time the notion was that in order to be branded
as gambling the competition must be one success in
which depended entirely on chance. If even a scintilla of
skill was required for success the competition could not
be regarded as of a gambling nature. The Court of
Appeal in the judgment under appeal has shown how
opinions have changed since the earlier decisions were
given and it is not necessary for us to discuss the matter
again. It will suffice to say that we agree with the Court
of Appeal that a competition in order to avoid the stigma
of gambling must depend to a substantial degree upon
the exercise of skill. Therefore, a competition success
wherein does not depend to a substantial degree upon
the exercise of skill is now recognised to be of a gambling
nature.”
(Emphasis Supplied)
279. The contention canvassed on behalf of the online gaming
companies is erroneous as the above finding in RMDC
CA Nos. 6124-6131 of 2023 & Connected Matters Page 145 of 269
cannot be read to support their contention for the following
reasons:
a) The first question that requires to be asked is whether
in the facts of RMDC-I (supra) , any game of skill was
played with stakes. The answer to this question is an
RMDC-I
overwhelming ‘No’. When in the facts of (supra) ,
there was no element of staking on a game of skill by
any player/participant, the judgment in RMDC-I (supra)
cannot be a binding precedent for the principle that a
game of skill when played with stakes would not be
gambling.
b) However, the judgment in RMDC-I ( supra ) is crucial and
lays down an important principle of law and must be
understood in the light of the underlying facts.
c) The 1939 Act, the 1948 Act and the 1952 Act defined
“prize competition”. The 1952 Act, under Section 12A
levied a tax on such “prize competitions”. The State of
Bombay traced the power to levy the tax to the erstwhile
th
Entry 62 of List II of the 7 Schedule to the Constitution
of India which permitted the State to levy taxes on
Betting and Gambling. The endeavour of the Promoter
in RMDC- I ( supra ) was to somehow establish that the
definition of prize competition covered Skill based
CA Nos. 6124-6131 of 2023 & Connected Matters Page 146 of 269
competitions, and the State was therefore incompetent
to levy a Tax under Entry 62 List II as the same would
not be gambling.
d) This Court examined the three limbs of the definition of
prize competitions and came to a conclusion that in all
the three categories the success in the competition was
chance based and proceeded to uphold the levy of the
State under Entry 62 List II by declaring them to be
gambling adventures. At this juncture, the Department
takes recourse to Sutra No.1 placed before this Court
i.e. there is no gambling if no stakes are involved,
irrespective of whether the underlying game is a game
of skill or game of chance.
e) The question that therefore arises is what were the
“stakes” in the facts of RMDC-I (supra) . The answer lies
in the underlying High Court judgment in RMDC-I
(supra) , placed on record by learned Senior counsel Mr.
Gopal Sankaranarayanan.
f) In the first paragraph, the following was recorded as
facts of the case:
“The registered office of the petitioners is
situated in Bangalore. They own and run a
weekly newspaper called the Sporting Star. This
paper is printed and published in Bangalore and
it contains a crossword prize competition called
CA Nos. 6124-6131 of 2023 & Connected Matters Page 147 of 269
the R.M.D.C. Crosswords for which entries are
received from various parts of India including
the State of Bombay. The petitioners have
agents and depots in various places in the
territory of India including the State of Bombay
to collect entry forms and fees for being
forwarded to the petitioners at Bangalore. The
petitioners advertise their crossword prize
competition in various publications in various
places in India including the State of Bombay.”
(Emphasis Supplied)
g) Therefore, every participant of the prize competition,
which was subject matter in RMDC-I (supra) , had paid
an “entry fee” to participate in the Competition. Section
12A, which levied the tax on such prize competitions
adopted the Gross Entry Fee (Total Entry Fee collected)
as the measure of Tax.
h) In other words, the entry fee paid by a participant, for a
prize competition covered under the respective Acts,
which were inherently gambling adventures,
constituted the stake amount. This is because the entry
fee was paid only on the uncertain and unknown
outcome of the event to gain an amount higher than
what was staked. It is for this reason that the
Department in Sutra No. 3 contended that a game of
chance involving even a competition fee is gambling,
CA Nos. 6124-6131 of 2023 & Connected Matters Page 148 of 269
because the entry fee paid for such a competition would
constitute the stake amount.
i) The same is however not true when the underlying game
is a game of skill. An entry fee paid for a competition,
which is skill-based, would not be gambling. RMDC-I ’s
ratio becomes pertinent only in this context.
j) In a prize competition involving an entry fee, when the
underlying competition is skill-based, the entry fee
would be for obtaining the right to participate in the
competition. The entry fee cannot be construed as stake
amount placed on the unknown and uncertain outcome
of the competition. This is because, unlike an entry fee
paid for a gambling adventure, in a skill-based
competition, the prize money is never linked to the bet
or stake amount. With utmost certainty, in a gambling
adventure, the pool money assured to the winner is
always linked to the bet or stake amount.
k) The online gaming companies, being aware of this
subtle difference, attempted to treat both the scenarios
as the same. In other words, the online gaming
companies contend that in both the scenarios, the entry
fee is only for the right to participate in the competition.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 149 of 269
It is at this juncture that the intention of the participant
becomes pertinent.
l) In a chance-based competition or an inherently
gambling adventure, the participant is merely taking a
shot at a hidden target and it is for that reason that the
entry fee would itself constitute the stake amount.
However, in a skill-based competition, the entry fee
would be paid towards obtaining a right to participate
and the intention is not to take a shot at a hidden target.
As stated earlier, in a skill-based competition, the prize
money is never linked to the stake amount. The
expression “entry fee” is a misnomer in a game of
chance.
m) Here again, the online gaming companies contend that
since rummy is a game of skill, the stakes placed by
each participant must be treated akin to an entry fee for
a skill-based competition. It was also argued that since
the Revenue concedes that an entry fee for a skill-based
competition is not gambling, the show-cause notices in
the present batch of maters requires to be quashed.
n) This argument requires to be rejected outright because
the online gaming companies in the facts and
circumstances of the case have not called for
CA Nos. 6124-6131 of 2023 & Connected Matters Page 150 of 269
participants to participate in any tournament
conducted by them where there are winners announced
and declared by the companies at the end of the
competition. To the contrary, the terms and conditions
is a clear invitation to place stakes on the uncertain and
unknown outcome of each game and where each game
has a winner, unlike a tournament. The companies
cannot be permitted to state that there can be hundreds
of tables (or virtual rooms) with varying amounts of pool
money and each table is a tournament by itself. Such a
contention would be too far-fetched and defies logic and
what is commonly understood as a competition or
tournament.
o) The aforesaid can also be looked into from one another
angle. If one examines the online gaming platforms, it is
nothing but a systematic inducement technique to
ensure a player bet more and more. This is provided in
the form of discounts, incentives for repeated betting,
incentives for a particular number of victories and of
course, as stated above, retaining the winnings upto a
particular amount before it could be withdrawn and a
prohibition to withdraw the deposited amount before it
is turned into winnings by staking the deposited
CA Nos. 6124-6131 of 2023 & Connected Matters Page 151 of 269
amount repeatedly. This never happens in a skill-based
competition. A promoter or an organizer of a skill-based
competition never induces a player or a participant to
repeatedly stake. The amount collected as an entry fee
in a skill-based competition would merely entitle a
player or participant to participate in the game.
p) In short, an entry fee for a chance-based adventure and
a skill-based competition boils down to the intention of
the player and the intention of the promoter.
q) It is in the above context that the ratio in RMDC-I (supra)
requires to be appreciated. If a promoter is floating a
skill-based competition for an entry fee, that per se
would not be gambling. If a promoter is floating a
chance-based competition for an entry fee, that per se
would constitute gambling. This alone is the inference
that can be drawn from RMDC-I (supra) .
r) RMDC-I (supra) cannot be relied upon by the online
gaming companies to contend that games of skill, when
played for stakes, would not amount to gambling,
especially when the underlying facts in RMDC-I (supra)
did not involve a game of skill and did not involve
placing stakes on such games of skill.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 152 of 269
280. In the context of Entry 34 List II, the ratio in RMDC-I (supra)
is crucial. The States have the power to regulate a chance-
based competition even for an entry fee since that would
constitute the stake amount. The States do not have the
power to regulate skill-based competitions for an entry fee
since the entry fee will not constitute the stake amount. For
example, the States cannot interfere with BCCI conducting
IPL tournaments or a school Under-14 All India Cricket
Tournament. However, powers under Entry 34 List II can be
exercised by the States even on games of skill when they are
played for stakes since the stake element would amount to
betting and gambling, providing the basis for the States to
interfere. RMDC-I ’s ratio merely seeks to achieve this
purpose.
281. If for any reason, in a given set of facts and circumstances,
it is found that the entry fee partakes the character of a stake
or nothing but the stake based on the outcome of such a
game or competition involving skill, then it would become
betting and gambling. On the other hand, if it retains its
character only as an entry fee and the organizers reward the
winner with the trophy or a cash prize or prize money which
is announced in advance, then it is in the nature of a reward
CA Nos. 6124-6131 of 2023 & Connected Matters Page 153 of 269
for one who has succeeded in the competition and would not
take the colour and character of a bet amount. This
distinction is not academic or superficial and happens in
reality.
282. Lastly, on a perusal of the judgment in RMDC-I (supra) , the
stand of the State is in fact, supported. This Court took
recourse and examined the aspects of gambling from the
ancient history perspective, the mythological perspective
and the perspectives offered by various religions. After
quoting extensively from the Rig Veda, the Mahabharata,
Yajnavalkya, and Vrihaspati, this Court also took note of
Hamilton’s Hedaya and the following was quoted with
approval:
“…Hamilton in his Hedaya, Vol IV, book XLIV, includes
gambling as a kiraheeat or abomination. He says “It is
an abomination to play at chess, dice or any other
game; for if anything is staked it is gambling, which is
expressly prohibited in the Koran or if, on the other
hand, nothing be hazarded it is useless and vain.”
(Emphasis Supplied)
283. Nothing could be more telling than the above reference to
Hamilton’s Hedaya by this Court. If this Court really
intended to permit and constitutionally protect games of skill
being played with stakes, it could not have possibly quoted
CA Nos. 6124-6131 of 2023 & Connected Matters Page 154 of 269
Hamilton’s Hedaya and in particular, the above extract in
support of that proposition, since it says exactly to the
contrary. There is nothing in RMDC-I (supra) to suggest that
this Court took note of Hamilton’s Hedaya and expressed
its disagreement over the same. To the contrary, in what
could be termed as a lecture on the aspects of Betting and
Gambling and how the same could not be elevated to the
level of a fundamental right under the Constitution, this
Court took recourse to Hamilton’s Hedaya as a supporting
document and specifically quoted a portion which says that
chess being played with stakes would amount to Gambling.
There cannot be any doubt that chess is a Game of Skill.
Therefore, to even remotely suggest that RMDC-I (supra) is
good law for the proposition that a game of skill being played
with stakes enjoys constitutional protection is incorrect and
deserves to be rejected.
284. There is something else that has drawn our curiosity. When,
according to the State, RMDC-I (supra) ’s ratio would not be
applicable in the present case, why is the State then placing
reliance on RMDC-I (supra) ? The answer lies in the 2nd
category of games covered by the definition of prize
CA Nos. 6124-6131 of 2023 & Connected Matters Page 155 of 269
competition, which was subject matter of interpretation in
RMDC-I (supra) .
nd
285. In the 2 category of competition, prizes were offered for the
forecast of results either of a future event or of a past event,
the result of which is not yet ascertained or not yet generally
known. This category was declared by this Court to be a
gambling adventure. The State, in the facts of the present
case, drew a parallel to contend that the players in the
platform are doing nothing but forecasting their victory in a
game of rummy, which event is unknown, uncertain and not
known at the time of placing the stake. When this Court has
held such forecasting to be gambling, the State contends
that the players are equally gambling because the act of
staking on the unknown and uncertain victory in the game
is no less forecasting.
286. The online gaming companies contend that the
interpretation of the State would overturn 70 years of
jurisprudence, as all courts in India have understood RMDC-
I (supra) in such a way that it protects games of skill to be
played with stakes, and the same would not amount to
gambling. With the greatest of respect, the above alleged
ratio does not flow on an explicit reading of RMDC-I (supra) .
CA Nos. 6124-6131 of 2023 & Connected Matters Page 156 of 269
When what does not flow from RMDC-I (supra) has been
canvassed for 70 years as if emanating from RMDC- I (supra) ,
the same is erroneous and requires a course correction.
There are multiple judgments rendered by various High
Courts which hold that games of skill played with stakes
amounts to gambling, and all these judgments have also
considered RMDC-I (supra) . It is therefore incorrect to say
that the views of the gaming companies have alone been
upheld or adopted throughout the country for 70 years. In
fact, the contention of the State is truly in spirit with RMDC-
I (supra) because the gaming companies are taking shelter
under a game of skill while actually promoting gambling,
which was frowned upon by this Court in RMDC-I (supra) .
Explicit gambling, though, while playing a game of skill,
would remain gambling and taking protection under an
assumed ratio of RMDC-I (supra) would be virtually undoing
RMDC-I (supra) .
V. Online Gaming Companies’ Interpretation of RMDC-II
287. The online gaming companies before this Court treated the
severability principle laid down in RMDC-II (supra) as an
extension of RMDC-I (supra) to contend that games of skill
move away from the regulatory sphere of Entry 34 List II. The
State completely agrees with this contention. It is true that
CA Nos. 6124-6131 of 2023 & Connected Matters Page 157 of 269
a genuine skill-based competition cannot be within the
regulatory sphere of Entry 34 List II. However, to further
stretch it to contend that since games of skill are outside the
purview of Entry 34 List II, even staking on them would not
be governed by the said entry is incorrect and cannot be
accepted.
288. RMDC-II (supra) will apply and protect games of skill from
the purview of Entry 34 List II only when they are not played
for stakes. However, once stakes are introduced in a game of
skill, the said entry would gain full relevance, and the States
will be competent to regulate stakes being placed on a game
of skill. It is incorrect to state that since games of skill enjoy
constitutional protection, even staking on such games of
skill enjoys equal protection. They do not, and such an
interpretation must be eschewed at the outset, and such an
interpretation would, in fact, be overturning what RMDC-I
(supra) and RMDC- II (supra) intended to achieve.
289. Lastly, reliance placed by the gaming companies on the
decision in K.R. Lakshmanan (supra) is also misplaced. As
we have already discussed, the decision protected only such
betting on horse-racing as took place within the club
premises on the day of the race being run in the racing club.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 158 of 269
This protection can be drawn from the second category of
games considered in RMDC-I (supra) wherein the forecasting
of uncertain events on the basis of statistical expertise and
skill was considered. When forecasting the outcome of a
horse-race is considered, the people who are present inside
the club on the day of the race being run definitely constitute
a small group of persons who may be attributed with above-
average expertise in the factors affecting the outcome of a
horse race. The situation in K.R. Lakshmanan (supra) was
entirely different from the situation before us, where there is
no enclosure in the virtual world, and where the average
participant cannot be credited with the expertise of a punter
inside a racing club. Furthermore, the express declaration of
betting from outside the club premises as illegal by the
decision in the said case further reinforces that the decision
was passed in the specific context of horse-racing, which is
very different in scale, accessibility and outreach than online
gaming activities.
290. Therefore, it is abundantly clear that there is no legal shelter
for the online gaming companies to claim that placing stakes
on games of skill would not amount to betting and gambling.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 159 of 269
The Authorities relied on by the Union and the States
uniformly hold the contrary.
VI. The impugned legislations do not suffer from
manifest arbitrariness
291. The concept of equality, as envisaged under Article 14,
contains an interdiction against arbitrariness and
discrimination. Insofar as the first part, it insists that the
likes must be treated equally. Though the word
discrimination is not used in the Article, the primary object
behind the Article is to avoid discrimination not only at the
point of framing a law but also at the point of execution. The
embargo, therefore, is applicable to substantive as well as
procedural laws. To withstand successfully to the challenge
of discrimination, the law must be based on reasonable
classification. There must be an object to such classification,
which must be legal, and the very object itself must not be
to discriminate. There must be a reasonable nexus between
the classification and the object sought to be achieved.
292. The classification must be such that there must be a logical
difference between the persons grouped together and the
persons left out. Such classification must not only have a
nexus to the object but must be determined towards
CA Nos. 6124-6131 of 2023 & Connected Matters Page 160 of 269
achieving that object and must be rational. If the
classification is reasonable, based on intelligible differentia,
it is neither discriminative nor arbitrary. Anything that is
discriminative is obviously arbitrary, but an arbitrary action
need not be merely discriminative. Similarly, when the
classification is found to be reasonable, just because it puts
another class at a different pedal or a particular section at a
disadvantageous position would not be a ground to treat is
either as arbitrary or warranting interference. In the present
case, we have already held that, irrespective of whether it is
a game of skill or chance, when coupled with stakes would
amount to betting and gambling. We have also clarified the
judgments in RMDC-I (supra) , RMDC-II (supra) , K.R.
Lakshmanan (supra) and explained the difference between
online and offline games, although when coupled with
stakes, there can be seldom any difference in the treatment.
Hence, we do not find any arbitrariness or discrimination as
envisaged so as to attract Article 14. The treatment or
definition in the act is a policy decision, which the state is
entitled to take, while classifying an activity. In the present
case, the classification is, as we have seen, based on a report.
Therefore, we find a reasonable nexus between the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 161 of 269
classification/definition and the object sought to be
achieved.
293. The terms betting and gambling which are often used
interchangeably and carry a specific meaning in common
parlance. The following are the ingredients of betting and
gambling:
a) There must be a stake/bet.
b) The bet that is placed must be on the result of an
uncertain outcome.
c) The stakes must be placed with a hope of gaining
substantially more than what is being staked,
depending upon the result of the uncertain event.
294. There is no question of manifest arbitrariness as betting and
gambling are independent activities in themselves and it is
not concerned with the nature of the game being played. The
artificial construction that is sought to be created by the
online gaming companies will denude the State of all the
powers to regulate and prohibit betting and gambling for
times to come. If such a contention is allowed to be
sustained, it will cause grave injustice to the saintly ideals of
the Fathers of our Constitution.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 162 of 269
295. If one examines the judgments rendered across several
jurisdictions, an inescapable conclusion that one would
arrive at is that the underlying classification of a game as
either skill or chance is immaterial and once any game is
played with stakes, it would amount to betting and gambling.
296. The Queen’s Bench had an occasion to examine Section 17
of the Licensing Act, 1872 in the case of Dyson v. Mason
reported in [L.R.] 22 Q.B.D. 351 . Section 17 of the Licensing
Act penalized a licensed person if he suffers any gaming or
any unlawful game to be carried on in his premises. The
Licensing Act, however, did not define the expression
gaming. What arose for consideration of the Court was
whether playing skittle pool on a billiard table for money in
places licensed for the sale of intoxicating liquors is gaming
under Section 17 of the Act.
297. To escape from Section 17, the Licensees set up a plea that
Games of Skill, though played with money, will not fall within
the ambit of gaming and further contended that the
expression gaming will only sweep within its ambit games of
chance. The respondent therein contended that even though
skittle pool may be a lawful game of skill, playing the same
with stakes would render it “gaming”, attracting Section 17.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 163 of 269
298. After examining the rival contentions, the following findings
were rendered by the Queen’s Bench:
a) Justice Huddleston declared skittle pool to be a game of
skill and formulated a question as to whether playing
the same for money would be gaming. While answering
the question, he held that playing any game for money
would amount to gaming. In support of this conclusion,
he relied on Patten v. Rhymer , Danford v. Taylor ,
Luff v. Leaper , Reg v. Ashton . He also adopted the
view of Justice Mellor in Bew v. Harston and
categorically declared that the view of Chief Justice
Cockburn in Bew v. Harston was unsupported by any
authority.
b) Justice Wills agreed with the Decision rendered by
Justice Huddleston and reiterated that playing of any
game for money would be gaming, as per ordinary use
of language and that there are many authorities in
support of this proposition.
299. The High Court of Calcutta, in the case of King Emperor v.
Arjoon Singh reported in 6 C.L.J. 708: 6 Cr. L.J. 421 was
examining the Bengal Public Gambling Act, 1867. The Act
CA Nos. 6124-6131 of 2023 & Connected Matters Page 164 of 269
did not really define gaming but merely indicated what it is
like and excluded wagering or betting on some particular
occasions and particular circumstances and also excluded a
lottery. Section 10 of the Act excluded the application of the
Act to games of mere skill wherever played. The question
before the High Court was whether, the game that was being
played at the time when the Petitioners were arrested was
gaming under the Act.
300. The High Court laid down a three-pronged test to determine
whether the offence of gaming was made out or not. They are
as follows:
a) First, it should be determined whether the game is
covered by the definition of gaming meaning thereby, to
determine whether a game was being played with
stakes.
b) Secondly, if the game is a game of chance, it is hit by
the Act.
c) Thirdly, if the game is a game of skill, it will not be hit
by the Act since Section 10 protects gaming on games
of skill.
301. As to when something would constitute gaming, the High
Court, after referring to the Imperial Dictionary, Murray’s
Dictionary, Hari Singh v. Jadu Nandan reported in (1914)
23 I.C., 484 , Ram Pratap Nemani v. Emperor reported in
CA Nos. 6124-6131 of 2023 & Connected Matters Page 165 of 269
1912 SCC OnLine Cal 161 and King Emperor v. Musa
reported in AIR 1917 Mad 124 respectively, held that it is
the existence of a stake and not the character of the game as
one of skill or chance, that is regarded as constituting the
distinction between playing a game and gaming. Entirely
King Emperor
adopting the view of Justice Sadashiva Iyer in
v. Musa (supra) , it was held that the question whether
chance or skill does not enter into the connotation of the
expression gaming. As a concluding remark, it was held that
all that should be seen is whether the game that was going
on was for money, which was staked on the result of the
game, which was to be lost or won according to the success
or failure of the person who had staked the money.
302. The High Court of Madras in the case of Re Musa & Ors.
was considering Section 3(10) of the Tamil Nadu Towns
Nuisances Act, 1889. Three crucial ratios emanate out of this
judgment and they are as follows:
a) It is the existence of a stake and not the character of the
game as one of skill or chance, that would determine
what gaming is.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 166 of 269
b) The importance of identifying the game as one of skill or
chance arises only because certain statutes protect
“gaming” on Games of Skill.
c) Games of Skill being protected throw no light on the
meaning of the word gaming.
303. In fact, the ratio of Re Musa (supra) is fortified by the
decision of the High Court of Allahabad in Panna Lal v.
Emperor reported in AIR 1926 ALL 187 . The question that
arose in the said case for consideration was whether playing
marbles, a game of skill, for stakes attracted the offence of
gaming under the Public Gambling Act. Section 13A of the
United Provinces Public Gambling (Amendment) Act, 1917,
excluded games of mere skill from the scope of the Act. It is
in this context that the High Court held that had it not been
for the exclusion under Section 13A, the conviction would
have been in order. While addressing the nature of exclusion,
the High Court held that the playing of a game of mere skill
for stakes in a public place is gaming, but it is not such
gaming as falls under the Public Gambling Act. This is a
categorical declaration that games of skill played with stakes
is gambling and the protection will simply not attract the
offence. The protection cannot be elevated to such a high
CA Nos. 6124-6131 of 2023 & Connected Matters Page 167 of 269
pedestal to contend that it would not amount to gambling at
all.
304. The ratios and propositions emanating from the above four
judgments referred to by the State can be formulated as
follows:
a) The expression of the word “gaming” in its natural
import would mean playing any game, whether skill or
chance, for stakes. Gaming, wherever not defined by the
statutes, is akin to betting and gambling.
b) Wherever the expression gaming is defined in the
statute, one has to go by the definition attributed to that
expression. Almost in all instances it would still indicate
it being akin to betting and gambling.
c) The character of the underlying game is immaterial in
determining whether there exists betting and gambling.
What is essential is the element of stake. Introducing
stakes in any game amounts to betting and gambling.
d) The underlying character of the game gains relevance
only when the statutes protect games of skill played
with stakes from constituting an offence. Such a
protection is immaterial to determine whether there
exist gaming or betting and gambling. This is because
CA Nos. 6124-6131 of 2023 & Connected Matters Page 168 of 269
protection is required only when it is betting and
gambling in the first place.
e) Wherever players enjoy the protection, it merely
indicates that it would not constitute an offence. The
protection cannot be read to mean that staking on a
game of skill would not amount to gambling at all.
305. A perusal of the judgments rendered pre-Constitution as well
as post-Constitution clearly indicates that as far as betting
and gambling are concerned, a differentiation cannot be
made between games of chance and games of skill because
the player staking the amount, in both cases, does it with a
hope of winning more money than what is staked. That is
the essence of gambling. An enquiry as to the nature of the
game, as that of skill or chance, can be done only when the
Statute in question protects a game of skill from penal
prosecution. Only in such cases, a differentiation between a
game of skill and a game of chance is required for the
purpose of ascertaining conviction. In the absence of such a
provision, the differentiation based on the underlying game
pales into insignificance as the underlying activity is betting
and gambling in both cases. When a particular statute does
not differentiate between games of chance or games of skill,
CA Nos. 6124-6131 of 2023 & Connected Matters Page 169 of 269
the gaming companies cannot possibly argue that even in
the absence of a protection clause they continue to be a
protected species. Rendering the states powerless to remove
such clauses of protection would amount to a constitutional
injustice and prohibit the state from exercising policy
discretion towards public welfare.
306. Therefore, when the element of betting and gambling enters
the picture, the nature of the game ceases to be of relevance.
The common aspect of addiction and the desire to gain more
and more looms large wherever staking money on an
uncertain event is involved. When such is the case, there is
no question of manifest arbitrariness since the States have
always been permitted to regulate or prohibit betting and
gambling. The States had hitherto permitted and protected
betting and gambling on games of skill. When a technological
boom happened and when the vicious activity of betting and
gambling entered every household, the States wanted to
remove such protection. While states like Telangana have
proactively made it an offence to gamble (even on games of
skill) in cyberspace, the judgments of the Madras High Court
and Karnataka High Court have restrained the two States
from preventing the destruction of the future of the youth.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 170 of 269
The judgments have not factored in the social evils and
consequences that would accrue if betting and gambling are
so rampant and prevalent in the society.
307. The judgment of the Division Bench in Director General of
Police, State of Tamil Nadu v. Mahalakshmi Cultural
Association reported in 2012 SCC OnLine Mad 1130 is of
utmost importance as it lays down the correct position of
law. The High Court of Madras held as follows:
“21. Playing of cards perhaps may be for relaxing
oneself or for an entertainment provided such play has
limitations. Playing of cards with stakes has two evils
i.e., it corrupts the mind of the players to become addict
and it makes most of the players bankrupt. Discussions
above undoubtedly point against the practice of
indulging in gambling, be it rummy or other similar
games, where wagering or betting is involved. We may
also refer to the ordinary use of the expression
"winning". The word "winning" has been given the
following meaning in the Universal Dictionary of
English Language, namely, "Amount won, esp. money
won in betting." In the Oxford English Dictionary, the
word "winning" is given the following meaning, namely,
"Things or sums gained, gains, profits, earnings in mod.
use chiefly applied to money won by gaming or betting."
In Webster's Third International Dictionary, the word
"winning" is given the following meaning, namely,
"Something one wins esp. the money won by success in
competition." Therefore, in the event a place is used for
gambling, it will be termed to be a gambling house and
such gambling would amount to an illegal activity in the
event the member or the guests or the club/association
make profit out of such gambling. The object of the
Association is also to allow the members to play cards
not amounting to gambling.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 171 of 269
22. We may also refer to yet another aspect as to
whether the guests can be also allowed to play rummy.
As per the objects of the Association, it is entitled to
entertain members and guests. So long as the guests
are allowed to use the association premises for an
activity which is not illegal, the Police has no authority
to proceed against them, as the Association would be
entitled to allow them to avail the facilities. In the event
the guests are found playing rummy (13 cards) with
stakes, they would be also considered as indulging in
gambling.
xxx xxx xxx
24. On the basis of the above discussions, we arrive at
the following conclusions:-
(1) The game of rummy (13 cards) is only a game of skill
even though an element of chance is also involved.
(2) In the event rummy is played by the members or the
guests without stakes, the provisions of the Chennai
City Police Act are not attracted.
(3) In the event rummy is played by the members or the
guests with stakes, the provisions of the Chennai City
Police Act are attracted.
(4) In the event the club/association either allows its
members or guests to play rummy with stakes or make
any profit or gain out of such gambling, the Police has
the authority to invoke the provisions of the Chennai
City Police Act.
(5) In order to ascertain as to whether the premises is
used as a gaming house for gambling, the Police is
entitled to invoke Section 23 of the Act.”
(Emphasis Supplied)
308. The High Court of Karnataka, in AIGF (supra) had held that
games of skill do not metamorphize into games of chance
merely because they are played online, and therefore, the
udgment of this Court in MJ Sivani (supra) cannot be the
best guide to distinguish online games and physical games.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 172 of 269
309. This Court had considered playing of any game , whether of
skill or chance, for money or money’s worth to be
gambling/gaming in MJ Sivani (supra) . The High Court of
Karnataka has failed to apply this ratio and has cursorily
distinguished the facts of the dispute in AIGF (supra) from
what was considered to be “gaming” as per common parlance
in MJ Sivani (supra) .
310. In MJ Sivani (supra) this Court referred to two definitions of
Gaming as given in the Strouds Judicial Dictionary and
th
Black’s Law Dictionary reported in 6 edn. at 679 , as
given below:
“(i) The Strouds Judicial Dictionary:
To play any game, whether of skill or chance for money
or money’s worth; and the act is not less gaming
because the game played is not in itself unlawful and
whether it involved or did not involve skill.
(ii) The Black’s Law Dictionary Bryan A. Garner &
Henry C. Black, Black’s Law Dictionary, (6th ed.) 679,
1990
The practice or act of gambling. An agreement between
two or more persons to play together at a game of
chance for a stake or wager which is to become the
property of the winner, and to which all contribute. The
elements of gaming are the presence of price or
consideration, chance and prize or reward.”
311. The Court also noted that Section 2(7) of Mysore Police Act,
1963, defines “gaming” to mean that “it does not include a
CA Nos. 6124-6131 of 2023 & Connected Matters Page 173 of 269
lottery but all forms of wagering or betting in connection with
any game of chance, except wagering or betting on a horse-
race, when such wagering or betting takes place”.
Accordingly, the Court defined ‘Gaming’ in the following
words:
“Gaming is to play any game whether of skill or chance
for money or money’s worth and the act is not less
gaming because the game is not in itself unlawful and
whether it involved or did not involve skill.”
(Emphasis Supplied)
312. In MJ Sivani (supra) this Court, while determining the issue
of the legality of prohibition on video games, under Section
2(7) of the Mysore Police Act, 1963, observed that, even if
video games were considered to be games of skill, the
outcome could be manipulated by tampering with the
machines. Therefore, the court refused to grant protection to
these games.
313. The medium of play, whether online or not, is not relevant to
the issue. The only thing that is required to be checked is
whether, irrespective of the nature of the game and
irrespective of the medium of play, whether stakes are
involved. The moment stakes are involved the medium of
CA Nos. 6124-6131 of 2023 & Connected Matters Page 174 of 269
playing or the nature of the game as one of skill or chance is
irrelevant because it will constitute betting and gambling.
314. As far as the contention of the online gaming companies that
the legislation violates their fundamental rights under Article
19(1)(g) is concerned, it has to be rejected at the outset for
the simple reason that once the trade being carried out by
the companies is classified as a “betting and gambling”
enterprise, it becomes res extra commercium and the
question of applicability of Article 19 does not arise.
VII. The impugned legislations are not disproportionate
315. The occasion for testing the impugned legislations on
proportionality does not arise as activities encompassed
under “betting and gambling” are in the nature of res extra
commercium, and as a reading of the decision in the two
RMDC cases also suggests, no one can claim a fundamental
right in operating an activity which is extra commercium .
316. Undoubtedly, games of skill would be protected by the
constitutional guarantee laid down under Article 19, but
betting or wagering on any game, be it a game of skill, would
not be entitled to receive any such protection.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 175 of 269
317. The Madras High Court, vide para 102 of the impugned
judgment, has held that the 2021 TN Amendment Act has
provided a sweeping definition to the word gaming under
Section 3-A and has therefore eliminated any chance for
display of skill even for little stakes. The High Court could be
said to have failed to appreciate that the moment the stakes
are involved, irrespective of the quantum and scale of such
stakes, the activity would fall under the ambit of betting and
gambling. When such is the case, the States are empowered
to legislate, regulate or prohibit under Entry 34 List II.
318. Vide Para 110 of the judgment in Junglee Games ( supra ),
the Madras High Court had agreed that gambling and betting
has a negative impact on individuals and can also be ruinous
to their well-being. After having observed the same, the
Court is incorrect in holding that the element of skill is being
neglected by the impugned legislation because ultimately,
staking on games of skill would also constitute betting and
gambling and can cause the same ruin and financial and
psychological hardship to individuals indulged in it.
319. Therefore, there is no question of proportionality since
gambling ventures are ultimately res extra commercium as
held in RMDC-I (supra) .
CA Nos. 6124-6131 of 2023 & Connected Matters Page 176 of 269
320. The High Court has held that a blanket ban on games of skill
played with little stake fails the proportionality test. This is
incorrect because there is no underlying constitutional right
to the online gaming companies. We say so because the
moment they are categorized as betting and gambling, the
underlying activity would become res extra commercium and
therefore, the states would have absolute power to impose a
blanket ban the moment stakes are involved. There can be
no question of proportionality when the underlying activity
itself is res extra commercium and lacks constitutional
protection under Article 14 or 19 of the Constitution of India.
A reference can be had to the judgment of this court in P.N.
Krishna Lal and Ors v. Govt of Kerala and others
reported in 1995 Supp (2) SCC 187 , wherein it was held, as
under:
“31. Under the Act, the State has absolute right to
regulate production, transport, storage, possession and
sale of liquor or intoxicant drug. No person has any
absolute right to sell liquor or intoxicated drug except in
accordance with law which aimed at preservation of
public health as well as to raise revenue. Dealing in
liquor or intoxicant drug is, therefore, not an absolute
right to business or trade but is a regulated right in
accordance with law. The Act prohibits mixing of
noxious substance with liquor or possession thereof.
The State, therefore, possesses the right of complete
control on all kinds of intoxicants, namely,
manufacture, collection, sale and consumption thereof.
Regulation of sale of potable liquor prevents reckless
CA Nos. 6124-6131 of 2023 & Connected Matters Page 177 of 269
propensity for adulterating liquor to make easy gain at
the cost of health and precious life of consumer, equally
none has freedom or fundamental right to do business
in adulterated articles of food. Cognizant to the
contemporaneous large scale deaths or grievous hurt to
the consumers of adulterated liquor mixed with noxious
substance, the Amendment Act aims to prevent their
recurrence and accordingly it came to be made.
32. No civilised society, therefore, would countenance
that a citizen has a fundamental right to trade or
business in activities which are criminal in its
propensity, immoral, obnoxious and injurious to health,
safety and welfare of the general public. It is, therefore,
a question, of public expedience and public morality
that the State is fully competent to regulate the
business in liquor or intoxicated drug to mitigate its evil
or to suppress it in its entirety. There is no inherent right
in a citizen to conduct business or trade in adulterated
intoxicated liquor by retail or wholesale. It is, therefore,
obvious that dealing in liquor inherently pernicious or
dangerous goods which endangers the community or
subversive of morale, is within the, legislative
competence under the Act. The State has thereby the
power to prohibit trade or business which is injurious
to the health and welfare of the public and the
elimination and exclusion from the business is inherent
in the nature of liquor business. The power of the
legislature to evolve the policy and its competence to
raise presumptive evidence should be considered from
this scenario.”
321. The competence of the state to regulate certain activity also
enables it to prohibit the same activity. The 2021 TN
Amendment Act has not provided a sweeping definition or a
“Midas touch”. It has merely brought every form of betting
and gambling under its sweep, and for that the States are
empowered under Entry 34 List II.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 178 of 269
322. Moreover, vide para 105, the Madras High Court in its
impugned judgment has expressed concern over the fact that
a simple game of volleyball or football played for a cash prize
will now come under the scope of the 1930 Gaming Act. This
speculation deserves to be rejected at the outset as contests
are different from tournaments, and the cash prize won as a
result of the exercise of skill in such tournaments would not
have a direct and immediate nexus to the stake amount that
is placed. An entry fee for a tournament based on a game of
skill is different from a stake amount. Moreover, the
preamble of the impugned Acts conveys that the online
medium with rampant scope for betting and gambling is the
species that is sought to be prohibited. In this regard, the
submissions of the Revenue in Part III of the Written
Submissions [Paragraph 26(m)-26(n), Para 27], where a
contest is distinguished from a tournament, may be read in
conjecture.
323. There is one another angle to look at this issue. The directive
principles of state policy as contained in the Constitution,
provide that the welfare of the people shall be the guiding
light for the State. In particular, it provides for securing the
health and strength of workers and also ensures that
CA Nos. 6124-6131 of 2023 & Connected Matters Page 179 of 269
children are protected from exploitation. It also enshrines in
Articles 38 and 47 that the states shall strive to promote the
welfare of the people and raise the standard of living. Online
betting and gambling have demonstrably been a serious
addiction hazard, and have also caused financial hardships
owing to their inherently risk-prone nature. This was taken
note of by the State Legislature of Tamil Nadu at the time of
enacting the impugned legislation, as the various
considerations and empirical factors considered by the
Legislature are taken note of in the preamble to the TN
Online Gambling Act 2022/23, which is reproduced
hereinbelow:
“[…] AND WHEREAS the Hon’ble High Court of Madras
by Common Order dated 03.08.2021 in W.P.No.18022
of 2020, etc, struck down Part II of the Tamil Nadu
Gaming and Police Laws (Amendment) Act, 2021,
which banned wagering or betting in cyber space, as
ultra vires the Constitution, with liberty to bring in an
appropriate legislation conforming to the constitutional
sense of propriety in the field of betting and gambling
by the State;
AND WHEREAS the Government constituted a Five
Member Committee under the Chairmanship of retired
Hon’ble Justice Thiru K. Chandru to advise on enacting
a fresh legislation on online games;
AND WHEREAS the Committee in its report, taking into
account the parameters of physical space of operation,
time of playing, players’ relationship with other
players, addiction level, amount of money involved,
level of economic activity, scale of organisers’ profit and
role of credit, has observed that online version of any
CA Nos. 6124-6131 of 2023 & Connected Matters Page 180 of 269
game cannot be compared with the offline version of the
game, except in cases of word games or board games
not involving any random outcome generator;
AND WHEREAS the said report further states that in
the case of online version of games including online
rummy, the algorithm for the random generators are
known to the developers and hence are pseudo random
generators; such games can be played with bots (an
autonomous program or character designed to interact
with systems or users); no mechanism is available for
auditing the centralised server architecture of the
gaming systems; and artificial intelligence can be used
to manipulate the games and lure the players into
continued indulgence;
AND WHEREAS the said report classifies the online
games, into two types, namely, one which have
minimal or negligible randomness factor and another
having random event or count generators which are
pseudo random and are addictively designed and
accordingly recommends to regulate the former and to
ban the latter;
AND WHEREAS in a recent survey conducted by the
Government among more than two lakh teachers of the
School Education department, to study the effects of
online games on school students, more than seventy
four per cent. of the teachers responded that
concentration of students is impacted, sixty seven per
cent. of the respondents said that they noticed eye
defects, more than seventy four per cent. of them said
they noticed decrease in intelligent quotient, writing
skills and creativity of students, more than seventy six
per cent. said they have noticed significant decrease in
self esteem of students, more than seventy seven per
cent. said they have noticed increase of anger in
students and more than seventy two per cent. said they
have noticed indiscipline among students;
AND WHEREAS the Government, on seeking the view
of the general public on the proposed legislation, more
than ninety nine per cent. that is, 10,708 out of the total
10,735 mails received, have requested for imposing a
total ban on online games;
CA Nos. 6124-6131 of 2023 & Connected Matters Page 181 of 269
AND WHEREAS seventeen stakeholders comprising of
representatives from the online gaming industry, think
tanks, political parties, players association and social
activists, who were provided an opportunity to express
their views in person, have put forth various
suggestions and requests to the Government, such as,
to allow self regulation by the industry themselves,
regulation by the Government, to differentiate real
money games and other forms of games, to provide age
and money restrictions, to ban advertisements, to
prevent money laundering, to provide grievance
redressal mechanism and to provide a total ban on
online games;
AND WHEREAS it is considered that the issues of
online gaming and gambling cannot be dealt with by
the old binary of game of chance versus game of skill
and a new conceptual framework is needed which
incorporates understanding of how information
technology operates at basic level, the critical difference
between physical and online in general and also
between physical and online versions of games;
AND WHEREAS it is an established scientific fact that
true random outcome is not feasible in a software and
any randomness will depend upon the specific
algorithm written by the developer and that audit of the
algorithm makes it difficult to detect any hidden
algorithm designed to favour the game provider and
that overlay of artificial intelligence in the online
gaming can make the gaming scenario completely
unfair to the game player/customer, with the game
service provider / facilitator literally being able to hold
all the cards; and that no scientifically validated
algorithm for testing of even pseudo randomness is
available at present;
AND WHEREAS due to the inherent addictiveness by
design of the online games and the money being put in
by the game players, the complete gaming scenario
amounts to an exploitative, addictive service, causing
not only health hazards but also social and economic
harm of epidemic proportions;
CA Nos. 6124-6131 of 2023 & Connected Matters Page 182 of 269
AND WHEREAS many research studies on the effects
of online gambling and online gaming addiction on
youth, have highlighted negative effects such as
development of aggressive behaviour, poor eye-sight,
reduced concentration, diminished analytical thinking,
decreased productivity and hence should be viewed as
a potent vice that would affect the long term prospects
of the State and its population;
AND WHEREAS the ruining of families and suicide
deaths due to online gaming addiction affects public
health, disturbs social order and prejudices the
maintenance of public order;
AND WHEREAS the Government, after careful
consideration of the report of the said Committee, the
findings of the survey among school teachers, research
studies on the subject, and the views of the
stakeholders and the general public, have decided to
enact a law to prohibit online gambling and to regulate
online games in the State; […]”
(Emphasis Supplied)
324. Thus, as a reading of the preamble would show, the
Legislature was mindful of the harms associated with betting
and gambling on online games, irrespective of their nature
as a game of skill or chance, and also the virtual
impossibility of devising a mechanism of regulation to ensure
fairness in algorithm and artificial intelligence-driven online
gaming platforms. The Legislature has also adverted to
specific findings of surveys on the effects of online gaming
on children and the severe consequences of the online
gaming-induced financial difficulties. It was only after taking
into consideration these factors and realities that the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 183 of 269
impugned legislation was enacted. We need not say any more
on whether despite taking into consideration the aforesaid
factors, the legislation could still be said to be arbitrary. The
answer would be a clear no.
VIII. On Nomen Juris and Legal Fiction
325. It was contended on behalf of the respondents that the word
“gaming” has acquired the status of a “ nomen juris ” to mean
to include only games of chance and thus, even by legislative
intervention or changes, games of skill cannot be read into
the definition of gaming. The said contention seems to have
found favour with the High Courts.
326. However, we are of the view that the aforesaid contention
cannot be accepted. The Constitution has deployed the
expression “betting and gambling” in Entry 34 of List II. The
word “gaming” does not define the subject matter of
Legislation in List II. The constitution makers had the
foresight not to constrain the future generations from
adopting an evolved meaning of the words employed by them
at the time of drafting of the Constitution. Thus, the words
used were deliberately kept broad enough to be able to take
shape and get moulded suitably by the tides of time, so as to
bring within their folds circumstances which could not have
CA Nos. 6124-6131 of 2023 & Connected Matters Page 184 of 269
been foreseen in 1950. The foresight and wisdom of the
Constitution makers lay not in predicting the future, but in
knowing the inevitability of change and evolution, and
codifying that inevitability in the language used in the
Constitution.
327. While the term “gaming” may be defined in a manner so as
to bring it within the meaning of the expression “betting and
gambling”, the constitutional expression “betting and
gambling” cannot be forced to conform to some archaic
definition of “gaming”. The words “gaming” and “gambling”
cannot always be equated. Gaming has not been judicially
defined to include only games of chance, contrary to what
has been held in the judgment in Junglee Games (supra) .
The phrase “gaming” cannot be said to be nomen juris . The
phrase “gaming” is a statutory definition that can be altered
according to the will of the Legislature. In no way can it be
dependent on the element of chance alone. The definition of
“gaming” is fluid and fluctuating across states and different
legislations. Therefore, by no stretch of imagination can the
term acquire the status of nomen juris . Each gaming statute,
with its unique and evolving definition of gaming, cannot
acquire nomen juris . The term gaming and what it includes
CA Nos. 6124-6131 of 2023 & Connected Matters Page 185 of 269
and excludes takes colour from the Legislature in question.
This has also been laid down by the High Court of Madras in
Re Musa (supra) where the Court interpreted the common
parlance meaning of the term “gaming” when the statute in
question did not have a carve-out clause that protected
betting and gambling on games of skill.
328. Further, the finding of the High Court of Madras that betting
and gambling on games of skill is deemed to be gaming by
way of legal fiction is incorrect. The judgments relied upon
in the previous paragraphs illuminate that the moment
stakes are involved, it would constitute betting and gambling
irrespective of the nature of the game. Therefore, there is no
question of Midas Touch or Legal fiction since, for eons,
staking money on any game has been considered to be
betting and gambling and hence pernicious.
329. As to why such protection offered to betting and gambling on
games of skill had to be removed, the preamble to the TN
Online Gambling Act 2022/23, read in tandem with our
following discussion, would make the legislative intent
unambiguous.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 186 of 269
330. In the aforesaid context and to conclude, the obiter dicta of
the judgment in D. Siluvai Venance v. State, rep. by the
Inspector of Police reported in 2020 SCC Online Mad
1546 needs to be looked into. What was opined by the Judge
would express the plight of the States and all the well-
wishers of the Nation. The extracts are reproduced
hereunder:
“22. The gaming industry in India is undergoing a
dramatic transition, not only in terms of its audience,
but also in terms of the modes of participation and
engagement. Gambling Laws in India prohibit betting or
wagering and any act which is intended to aid or
facilitate the same. For the purpose of regulating
gaming in India, most of the Indian legislations
differentiate between "games of skill" and "games of
chance". Gaming/Gambling, being a State Subject,
India has laws which differ from State to State.
Therefore, what is permitted in one State, may be an
offence in another.
23. The Public Gaming Act, 1867, is the Central Act in
this subject, which has been adopted by several State
Governments and the remainders have enacted their
own legislation to regulate gaming/gambling, within its
territory. It is to be noted at this juncture that such State
legislations have been enacted prior to the advent of
virtual/online gambling in India, except the State of
Sikkim, Nagaland and Telangana, which have
introduced regulations pertaining to online gaming also.
xxx xxx xxx
37. It is to be noted at this juncture that except the
decisions in Varun Gumber's case [High Court of Punjab
and Haryana]; Gurdeep Singh Sachar's case [Bombay
High Court]; and Chandresh Sankhla's case [High
Court of Rajasthan] which dealt with the fantasy sport-
Dream11, none of the precedents referred supra deal
with online gaming. The decisions discussed supra are
in respect of recreational clubs and not specifically refer
CA Nos. 6124-6131 of 2023 & Connected Matters Page 187 of 269
about any virtual area, like, Internet. Neither the Public
Gaming Act, 1867, nor the Tamil Nadu Gaming Act,
1930, specifically speaks about such virtual area, as
the advent of such online games are very recent. In fact,
the Hon’ble Supreme Court, while dealing with an
appeal, has held that the issue pertaining to online
rummy has not arisen at all, till date.
38. India has a rich heritage with a diverse range of
sports/games. Sports is not only an important source
of entertainment, but also imparts value of hard work,
discipline and co-operation. To regulate the physical
sports/games, we are having a legislative set up, but
having such a set up to deal with the emerging online
games/virtual games is the need of the hour. A
comprehensive regulatory framework by a regulatory
body is necessary to regulate the online sports and to
curb any illegal activities as well. In fact, such
regulation of online sports would encourage investment
in the sector, which could lead to technological
advancements as well as generation of revenue and
employment.
39. We should not loose [sic] sight of the fact that
nowadays, almost in all the social media, youngsters
are being attracted, to play such online games, by
alluring with prize money. Gaming sites are also
partaking a slice on the winning hand, as of a virtual
gambling house. In fact, these online games lure the
unemployed youth that they can earn money by playing
these games.
40. Saint Thiruvalluvar in 934th and 939th couplet of
Thirukkural described the evils of gambling as
follows:…….
which means--
"There is nothing else that brings poverty like gambling
which causes many a misery and destroys one's
reputation." ….
which means-
"Gambling would preclude the five Rathnas, viz.,
Reputation, Education, Wealth, Food and Cloth, from
reaching the person."
CA Nos. 6124-6131 of 2023 & Connected Matters Page 188 of 269
41. At this juncture, this Court is inclined to share the
modus operandi of such online games.
42. If X and Y want to play a game, both of them have
to bet a sum of Rs. 10/- (Say). The winner will get the
amount that he put in place, i.e., Rs. 10/- and in
addition to that, he will get an additional sum, Say 75%
that was put in place by the opponent, being the prize
amount. The balance, i.e., 25%, will be credited to the
account of the particular online gaming site. The loser
will loose [sic] everything.
43. If a group of persons (Say 10) want to play a game,
each one of them have to bet a sum of Rs. 10/- (Say).
At the end of the game, the Winner will get his amount
as well as 100% of his bet amount, being the prize
money. The Runner will get his amount as well as 70%
of his bet amount, being the prize money. The losers will
not only loose [sic] the game, but also loose [sic] Rs. 10/-
that was put in by them. A rough calculation for the
aforesaid scenario will give a whooping sum of Rs. 63/-
to the online gaming site, while awarding Rs. 20/- to
the Winner and Rs. 17/- to the Runner. Naturally, a
player, if he looses [sic] his amount, will try to meet out
his loss by playing again and again.
44. To be noted, if these set of unemployed youth, who
are also under frustration, if get trapped into these
elements, may go to any level to meet their loss. The
most dangerous thing for any Society is educated
criminals. If a knowledgeable person turns out to be a
criminal, it would be a havoc on the society. Nowadays,
we are also witnessing Graduates involving in chain
snatches and other dacoity cases.
45. Keeping these aspects in mind and to regulate and
monitor such virtual games, some of the States have
amended their prevailing Gaming Acts.
46. The Sikkim Online Gaming (Regulation) Act, 2008,
mandates that license has to be obtained for conducting
such online games, within the State's boundaries.
47. The Nagaland Prohibition of Gambling and
Promotion and Regulation of Online Games of Skill Act,
CA Nos. 6124-6131 of 2023 & Connected Matters Page 189 of 269
2016, has excluded the staking of money on games of
skill from the ambit of gambling. The Act also defines
what are the games of skill and also listed them. Of
course, license has to be obtained for conducting such
games, within it's boundaries.
48. The Telangana Gaming (Amendment) Act, 2017,
prohibits all forms of gaming for money, be it games of
skill or games of chance. In fact, the Government of
Telangana has further moved a Bill to amend the
Telangana Prevention of Dangerous Activities of
Bootleggers, Dacoits, Drug-Offenders, Goondas,
Immoral Traffic Offenders and Land-Grabbers Act,
1986, by including "Gaming Offender", who commits or
abets the commission of offences punishable under the
Telangana Gaming Act, 1974.
49. When the menace of lottery was at its peak, sucking
the blood and life of several families, the Government
of Tamil Nadu, in the year 2003, has taken a rigid
stand, with an iron hand and banned the sale of all
lotteries, including online, within the territory of the
State, by passing the Government Order in G.O. Ms. No.
20 Home (Courts II) Department dated 08.01.2003. This
Government Order, though challenged before the
Courts of law, still holds the field. By virtue of this
order, the Government has thus prevented the suicidal
deaths, who have not only lost their hard earned money
but also their family peace and reputation, in the State.
50. Similarly, when the menace of charging exorbitant
interest, by way of 'daily vatti', 'hourly vatti', 'kandhu
vatti', 'meter vatti', 'vattiku vatti', was in its prime, the
Government of Tamil Nadu, in the year 2003, has
enacted Tamil Nadu Prohibition of Charging Exorbitant
Interest Act, 2003, thereby, wiped the tears of the
affected people at large.
51. Therefore, this Court hopes and trusts that this
Government shall take note of the present alarming
situation and pass suitable legislation, thereby,
regulating and controlling such online gaming through
license, of course, keeping in mind the law of the land
as well as the judicial precedents in this regard. This
Court is not against the virtual games, but, the anguish
CA Nos. 6124-6131 of 2023 & Connected Matters Page 190 of 269
of this Court is that there should be a regulatory body
to monitor and regulate the legal gaming activities, be it
in the real world or the virtual world. Needless to say
that if the Government intends to pass a legislation in
this regard, all the stakeholders should be put in notice
and their views should be ascertained.
52. Since this Court is exercising power under Section
482 Cr.P.C., with the above suggestions, this Court
refrains from observing any further, leaving it to the
Government.”
(Emphasis Supplied)
331. The states are always at liberty to define a particular word
or expression for the purpose of achieving the object of the
enactment. The scope of judicial review of a challenge to a
definition or classification is limited. As we have already held
that when the Parliament or the Legislature has, in its
wisdom, either defined or classified a particular expression,
it is not for the courts to give a different interpretation to
deviate from the object the enactment seeks to achieve by
altering the natural meaning attached to the expressions in
the enactment. A reference may be had to the judgment of
this Court in Polestar Electronic (Pvt.) Ltd. v. Additional
Commissioner, Sales Tax reported in (1978) 1 SCC 636 ,
this Court has held as under:
“7. Now, if there is one principle of interpretation more
well-settled than any other, it is that a statutory
enactment must ordinarily be construed according to
the plain natural meaning of its language and that no
words should be added, altered or modified unless it is
plainly necessary to do so in order to prevent a
CA Nos. 6124-6131 of 2023 & Connected Matters Page 191 of 269
provision from being unintelligible, absurd,
unreasonable, unworkable or totally irreconcilable with
the rest of the statute. This rule of literal construction is
firmly established and it has received judicial
recognition in numerous cases. Crawford in his book on
“Construction of Statutes” (1940 Edn.) at p. 269
explains the rule in the following terms:
“Where the statute's meaning is clear and explicit,
words cannot be interpolated. In the first place, in such
a case they are not needed. If they should be
interpolated, the statute would more than likely fail to
express the legislative intent, as the thought intended
to be conveyed might be altered by the addition of new
words. They should not be interpolated even though the
remedy of the statute would thereby be advanced, or a
more desirable or just result would occur. Even where
the meaning of the statute is clear and sensible, either
with or without the omitted word, interpolation is
improper, since the primary source of the legislative
intent is in the language of the statute.”
Lord Parker applied the rule in R. v. Oakes [(1959) 2 All
ER 350] to construe “and”, as “or” in Section 7 of the
Official Secrets Act, 1920 and stated :
“It seems to this Court that where the literal reading of
a statute, and a penal statute, produces an intelligible
result, clearly there is no ground for reading in words
or changing words according to what may be the
supposed intention of Parliament. But here we venture
to think that the result is unintelligible.”
Lord Reid also with great clarity and precision which
always characterise his judgment enunciated the rule
as follows in Federal Steam Navigation Co.
Ltd. v. Department of Trade and Industry [(1974) 2 All
ER 97] :
“Cases where it has properly been held that a word can
be struck out of a deed or statute and another
substituted can as far as I am aware be grouped under
three heads: where without such substitution the
provision is unintelligible or absurd or totally
unreasonable; where it is unworkable; and where it is
CA Nos. 6124-6131 of 2023 & Connected Matters Page 192 of 269
totally irreconcilable with the plain intention shown by
the rest of the deed or statute.”
This rule in regard to reading words into a statute was
also affirmed by this Court in several decisions of
which we may refer only to one,
namely, Narayanaswami v. Pannerselvam [(1972) 3
SCC 717 : AIR 1972 SC 2284 : (1973) 1 SCR 172] where
the Court pointed out that:
“‘..... addition to, or modification of words used in
statutory provision is generally not permissible ...’, but
‘courts may depart from this rule to avoid a patent
absurdity’.”
Here, the word used in Section 5(2)(a)(ii) and the second
proviso is “re-sale” simpliciter without any
geographical limitation and according to its plain
natural meaning it would mean re-sale anywhere and
not necessarily inside Delhi. Even where the
purchasing dealer resells the goods outside Delhi, he
would satisfy the requirement of the statutory provision
according to its plain grammatical meaning. There are
no words such as “inside the Union Territory of Delhi”
qualifying “re-sale” so as to limit it to re-sale within the
territory of Delhi. The argument urged on behalf of the
Revenue requires us to read such limitative words in
Section 5(2)(a)(ii) and the second proviso. The question
is whether there is any necessity or justification for
doing so? If “re-sale” is construed as not confined to the
territory of Delhi, but it may take place anywhere, does
Section 5(2)(a)(ii) or the second proviso lead to a result
manifestly unintelligible, absurd, unreasonable,
unworkable or irreconcilable with the rest of the Act? Is
there any compulsive necessity to depart from the rule
of plain and natural construction and read words of
limitation in Section 5(2)(a)(ii) and the second proviso
when such words have been omitted by the law-giver?
We do not think so.
8. It may be pointed out in the first place that the
Legislature could have easily used some such words as
“inside the Union Territory of Delhi” to qualify the word
“re-sale”, if its intention was to confine re-sale within
the territory of Delhi, but it omitted to do what was
CA Nos. 6124-6131 of 2023 & Connected Matters Page 193 of 269
obvious and used the word “re-sale” without any
limitation or qualification, knowing full well that unless
restriction were imposed as to situs, “re-sale” would
mean re-sale anywhere and not merely inside the
territory of Delhi. The Legislature was enacting a piece
of legislation intended to levy tax on dealers who are
laymen and we have no doubt that if the legislative
intent was that “re-sale” should be within the territory
of Delhi and not outside, the Legislature would have
said so in plain unambiguous language which no
layman could possibly misunderstand. It is a well-
settled rule of interpretation that where there are two
expressions which might have been used to convey a
certain intention, but one of those expressions will
convey that intention more clearly than the other, it is
proper to conclude that, if the legislature used that one
of the two expressions which would convey the
intention less clearly, it does not intend to convey that
intention at all. We may repeat what Pollack C.B. said
in Attorney General v. Sillem [(1864) 2 H & C 431, 526]
that:
“If this had been the object of our legislature, it might
have been accomplished by the simplest possible piece
of legislation; it might have been expressed in language
so clear that no human being could entertain a doubt
about it.”…
IX. The State Legislature also derives competence from
the Entry 1 List II, that is, “public order”
332. One another vital issue that falls for our consideration is
whether the State of Tamil Nadu and State of Karnataka had
the legislative competence under Article 246(3) r/w Entry 1
th
of List II in the 7 Schedule to the Constitution of India, for
the purpose of enacting Part II of the 2021 TN Amendment
Act and the 2021 Karnataka Amendment Act, respectively.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 194 of 269
This, we feel, is in addition to the duties of the State
enshrined in the directive principles, about which we have
discussed above.
333. Entry 1 in the State List reads as follows:
Public order (but not including the use of any naval,
military or air force or any other armed force of the
Union or of any other force subject to the control of the
Union or of any contingent or unit thereof in aid of the
civil power)
a. Contours of the Expression “Public Order”
334. This Court has interpreted the expression “public order” in
Entry 1 of the State List at multiple instances and has
consistently held that it is an expression that has a very wide
connotation. Notions of what constitutes this wider concept
of public order have been expounded in various judgments.
The categories below distil the judicially-developed
ingredients.
b. Detriment to tranquility, health, and comfort
335. One of the earliest cases to interpret the expression ‘public
order’ and give the phrase a wide connotation is the decision
of this Court in Romesh Thappar v. State of Madras
reported in AIR 1950 SC 124: 1950 SC 436 . It laid down
CA Nos. 6124-6131 of 2023 & Connected Matters Page 195 of 269
the meaning of “public order” to mean an expression that
signifies the state of tranquility which prevails among the
members of a political society, as a result of the internal
regulations enforced by the government. It thereby conceived
public order not merely as the absence of disorder but as the
existence of a peaceful social condition enabling normal civic
life.
“6. The impugned Act was passed by the Provincial
Legislature in exercise of the power conferred upon it
by Section 100 of the Government of India Act, 1935,
read with Schedule VII List II Entry 1 to that Act, which
comprises among other matters, “public order”. Now
“public order” is an expression of wide connotation and
signifies that state of tranquillity which prevails among
the members of a political society as a result of the
internal regulations enforced by the Government which
they have established. Although Section 9(1-A) refers to
“securing the public safety” and “the maintenance of
public order” as distinct purposes, it must be taken that
“public safety” is used as a part of the wider concept of
public order, for, if public safety were intended to
signify any matter distinct from and outside the content
of the expression “public order”, it would not have been
competent for the Madras Legislature to enact the
provision so far as it relates to public safety. This
indeed was not disputed on behalf of the respondents.
But it was urged that the expression “public safety” in
the impugned Act, which is a statute relating to law and
order, means the security of the province, and,
therefore, “the security of the State” within the meaning
of Article 19(2) as “the State” has been defined in
Article 12 as including, among other things, the
Government and the legislature of each of the erstwhile
provinces. Much reliance was placed in support of this
view on R. v. Governor of Wormwood Scrubs Prison, ex
p Foy [R. v. Governor of Wormwood Scrubs Prison, ex p
Foy, (1920) 2 KB 305] where it was held that the
phrase “for securing the public safety and the defence
CA Nos. 6124-6131 of 2023 & Connected Matters Page 196 of 269
of the realm” in Section 1 of the Defence of the Realm
(Consolidation) Act, 1914, was not limited to securing
the country against a foreign foe but included also
protection against internal disorder such as a rebellion.
The decision is not of much assistance to the
respondents as the context in which the words “public
safety” occurred in that Act showed unmistakably that
the security of the State was the aim in view. Our
attention has not been drawn to any definition of the
expression “public safety”, nor does it appear that the
words have acquired any technical signification as
words of art.”
(Emphasis Supplied)
336. An application of this understanding can be found in State
of Rajasthan v. Shri. G Chawla & Dr. Pohumal, reported
in AIR 1959 SC 544 wherein the State of Ajmer (later State
of Rajasthan) enacted the Ajmer (Sound Amplifiers Control)
Act, 1952. The Act imposed restrictions on the tuning and
placement of amplifiers. For example, it mandated that an
amplifier cannot be so tuned to be audible beyond 30 yards
and cannot be placed at a height of more than six feet from
the ground. The legislative competence of the State was
challenged on the ground that amplifiers are instruments of
broadcasting and communication, and their control would
fall within the exclusive domain of the Parliament under
Entry 31 of List I.
337. Rejecting this contention, this Court held that the
manufacture or the licensing of amplifiers or the control of
CA Nos. 6124-6131 of 2023 & Connected Matters Page 197 of 269
their ownership or possession, including the regulating of
the trade in such apparatus, is one matter, but the control
of the use of such apparatus, though legitimately owned and
possessed, to the detriment of the tranquillity, health and
comfort of others, is quite another. Sustaining the legislation
under Entry 1 of the State List, this Court vide Paras 12-14
held as follows:
“12. There can be little doubt that the growing nuisance
of blaring loudspeakers powered by amplifiers of great
output needed control, and the short question is
whether this salutary measure can be said to fall
within one or more of the entries in the State List. It
must be admitted that amplifiers are instruments of
broadcasting and even of communication, and in that
view of the matter, they fall within Entry 31 of the
Union list. The manufacture, or the licensing of
amplifiers or the control of their ownership or
possession, including the regulating of the trade in such
apparatus is one matter, but the control of the ‘use' of
such apparatus though legitimately owned and
possessed, to the detriment of tranquility, health and
comfort of others is quite another. It cannot be said that
public health does not demand control of the use of
such apparatus by day or by night, or in the vicinity of
hospitals or schools, or offices or habited localities. The
power to legislate in relation to public health includes
the power to regulate the use of amplifiers as producers
of loud noises when the right of such user, by the
disregard of the comfort of and obligation to others,
emerges as a manifest nuisance to them. Nor is it any
valid argument to say that the pith and substance of
the Act falls within Entry 31 of the Union list, because
other loud noises, the result of some other instruments
etc., are not equally controlled and prohibited.
13. The pith and substance of the impugned Act is the
control of the use of amplifiers in the interests of health
and also tranquility, and thus falls substantially (if not
CA Nos. 6124-6131 of 2023 & Connected Matters Page 198 of 269
wholly) within the powers conferred to preserve,
regulate and promote them and does not so fall within
the entry in the Union list, even though the amplifier,
the use of which is regulated and controlled is an
apparatus for broadcasting or communication. As
Latham, C.J. pointed out in Bank of New South
Wales v. The Commonwealth [(1948) 76 CLR I, 186] :
“A power to make laws ‘with respect to’ a subject-
matter is a power to make laws which in reality and
substance are laws upon the subject-matter. It is not
enough that a law should refer to the subject-matter or
apply to the subject-matter : for example, income tax
laws apply to clergymen and to hotel-keepers as
members of the public; but no one would describe an
income tax law as being, for that reason, a law with
respect to clergymen or hotel-keepers. Building
regulations apply to buildings erected for or by banks;
but such regulations could not properly be described as
laws with respect to banks or banking.”
14. On a view of the Act as a whole, we think that the
substance of the legislation is within the powers
conferred by entry No. 6 and conceivably entry No. 1 of
the State List, and it does not purport to encroach upon
the field of entry No. 31, though it incidentally touches
upon a matter provided there. The end and purpose of
the legislation furnishes the key to connect it with the
State List. Our attention was not drawn to any
enactment under entry No. 31 of the Union list by which
the ownership and possession of amplifiers was
burdened with any such regulation or control, and
there being thus no question of repugnancy or of an
occupied field, we have no hesitation in holding that the
Act is fully covered by the first cited entry and
conceivably the other in the State List.
(Emphasis Supplied)
338. Subsequently, in Rev. Stainislaus (supra) , this Court
considered the constitutional validity of the M. P. Dharma
Swatantraya Adhiniyam, 1968, and the Orissa Freedom of
CA Nos. 6124-6131 of 2023 & Connected Matters Page 199 of 269
Religion Act, 1967 respectively enacted by the State of
Madhya Pradesh and the State of Orissa respectively. The
legislative competence of the State Legislatures was
challenged on the ground that matters of religion fall within
the residuary power of the Union under Entry 97 of List I.
However, the State Governments defended the enactments
as ‘public order’ legislations.
339. This Court held that the impugned Acts fall within the
purview of Entry 1 of List II of the Seventh Schedule as they
are meant to avoid disturbance to the public order by
prohibiting conversion from one religion to another in a
manner reprehensible to the conscience of the community.
It especially noted that anything that disturbs the current of
the life of the community, and does not merely affect an
individual, would amount to disturbance of public order.
Situations such as forcible conversions or attempts to
provoke communal passions have a clear potential to disturb
communal harmony, therefore falling within the State’s
power to legislate on public order. The relevant paragraphs
of the judgment are reproduced here below:
“24. The expression “public order” is of wide
connotation. It must have the connotation which it is
meant to provide as the very first Entry in List II. It has
been Held by this Court in Ramesh Thappar v. State of
CA Nos. 6124-6131 of 2023 & Connected Matters Page 200 of 269
Madras [1950 SCC 436 : AIR 1950 SC 124 : 1950 SCR
594 : 51 Cri LJ 1514] that “public order” is an
expression of wide connotation and signifies state of
tranquillity which prevails among the members of a
political society as a result of internal regulations
enforced by the Government which they have
established.
25. Reference may also be made to the decision
in Ramjilal Modi v. State of U.P. [AIR 1957 SC 620 :
1957 SCR 860, 866 : 1957 Cri LJ 1006] where this
Court has Held that the right of freedom of religion
guaranteed by Articles 25 and 26 of the Constitution is
expressly made subject to public order, morality and
health, and that
it cannot be predicated that freedom of religion can
have no bearing whatever on the maintenance of public
order or that a law creating an offence relating to
religion cannot under any circumstances be said to
have been enacted in the interests of public order.”
It has been Held that these two articles in terms
contemplate that restrictions may be imposed on the
rights guaranteed by them in the interests of public
order. Reference may as well be made to the decision
in Arun Ghoshe v. State of West Bengal [(1970) 1 SCC
98 : 1970 SCC (Cri) 67] where it has been Held that if
a thing disturbs the current of the life of the community,
and does not merely affect an individual, it would
amount to disturbance of the public order. Thus if an
attempt is made to raise communal passions, e.g. on
the ground that some one has been “forcibly” converted
to another religion, it would, in all probability, give rise
to an apprehension of a breach of the public order,
affecting the community at large. The impugned Acts
therefore fall within the purview of Entry 1 of List II of
the Seventh Schedule as they are meant to avoid
disturbances to the public order by prohibiting
conversion from one religion to another in a manner
reprehensible to the conscience of the community. The
two Acts do not provide for the regulation of religion and
we do not find any justification for the argument that
they fall under Entry 97 of List I of the Seventh
Schedule.
(Emphasis Supplied)
CA Nos. 6124-6131 of 2023 & Connected Matters Page 201 of 269
c. Public Safety or Interest
340. This Court has recognized that ‘public order’ overlaps
substantially with notions of public safety, public
tranquillity, and in certain contexts public interest as well
and that ‘public order’ in Entry 1 of List II can be read
comprehensively to include such aspects. While in Romesh
Thappar (supra) , the statute in question used ‘public safety’
and maintenance of “public order” as distinct expressions,
this Court treated public safety as part of the wider concept
of public order. It thereby approached public safety as
subsumed within public order.
341. This overlap has also been elucidated in Nek Mohammad v.
Province of Bihar, reported in 1948 SCC OnLine Pat 54
where the Patna High Court held that “public order” as
mentioned in the provincial legislative entry is
comprehensive enough to include public safety in its relation
to maintenance of public order, and that “public safety” in
that statutory setting is either synonymous with public order
or comprehended within it vide page 782 of the judgment:
“Section 3 says that an order made under section 2
shall be in force for a period not exceeding six months
from the date on which it is made unless earlier
revoked by the authority making the order. Section 4
relates to grounds of detention. I shall have to consider
the terms of section 4 in detail in connection with
CA Nos. 6124-6131 of 2023 & Connected Matters Page 202 of 269
another argument, and for the purpose of the
arguments which we are now considering it is not
necessary to quote the terms of section 4. Learned
Counsel for the petitioners has emphasised that the
expression ‘public safety’ occurs both in the preamble
and in section 2(1). He has further emphasised that the
word ‘and’ between the two expressions ‘public safety’
and ‘maintenance of public order’ shows that the two
expressions relate to different subjects. In my opinion,
learned Counsel for the petitioners has approached the
subjects mentioned in the three Legislative Lists from
an entirely wrong, narrow and technical point of view.
It has been more than once held that in interpreting a,
Constitution Act a wide meaning should be given to the
words which confer upon any Legislature the power to
legislate on certain topics and, within the ambit of the
words, the most sovereign powers must be understood
to be given to the Legislature. It has been further held
that the entries in the Constitution Act should be given
a large and liberal interpretation, the reason being that
the allocation of the subjects in the three Lists is not by
way of scientific definition but by way of a
mere simplex enumeratio of broad categories, [see the
observations made by their Lordships of the Federal
Court In the matter of the Central Provinces and Berar
Sales of Motor Spirit and Lubricants Taxation
Act [(1939) A.I.R. (F.C.) 1.] . Dealing with the question
of the interpretation of the subjects in the three
Legislative Lists, it was observed by his Lordship
Gwyer, C.J., in A.L.S.P.P.L., Subrahmanyan
Chettiar v. Muttuswami Goundan [(1941) A.I.R. (F.C.)
47.] , as follows:—“It must inevitably happen from time
to time that legislation, though purporting to deal with
a subject in one list, touches also on a subject in
another list, and the different provisions of the
enactment may be so closely intertwined that blind
adherence to a strictly verbal interpretation would
result in a large number of statutes being declared
invalid because the Legislature enacting them may
appear to have legislated in a forbidden sphere. Hence
the rule which has been evolved by the Judicial
Committee whereby the impugned statute is examined
to ascertain its ‘pith and substance’, or its ‘true nature
and character’, for the purpose of determining whether
it is legislation with respect to matters in this list or in
CA Nos. 6124-6131 of 2023 & Connected Matters Page 203 of 269
that.” In Prafulla Kumar Mukherjee v. Bank of
Commerce, Ltd., Khulna [(1947) A.I.R. (P.C.) 60.] , it
was pointed out by their Lordships of the Privy Council
that it was not possible to make so clean a cut between
the powers of the various legislatures that they would
never overlap. Their Lordships then say—“Subjects
must still overlap and where they do the question must
be asked what in pith and substance is the effect of the
enactment of which complaint is made and in what list
is its true nature and character to be found. If these
questions would not be asked, much beneficent
legislation would be stifled at birth, and many of the
subjects entrusted to Provincial Legislation could never
effectively be dealt with”. If these observations are kept
in view, then there can be no doubt that the true nature
and character of the Act under our consideration brings
it within item 1 of the Provincial Legislative List. That
item mentions first “public order” in its general and
widest sense, subject only to one limitation that it does
not include the use of His Majesty's naval, military or
air forces in aid of the civil power; then, there is a
further particular— “preventive detention for reasons
connected with the maintenance of public order”. This
particular merely indicates one aspect of public order.
The expression “public order” in List I of the Provincial
Legislative List must, in its context, be taken in a
comprehensive sense so as to include public safety in
its relation to the maintenance of public order. The
expression “public safety” may have one meaning in
one context and another in a different context; for
example, traffic regulations for motor vehicles may
have an aspect of public safety, so also adulteration of
foodstuffs and other goods. The subject of adulteration
of foodstuffs is item 30 of the Provincial Legislative List.
I do not think it can be contended for one moment that
the Provincial Legislature has no power to make laws
with respect to adulteration of foodstuffs and other
goods, merely because the subject may, in some of its
aspects, be connected with, public safety. In the same
way the maintenance of public order undoubtedly
involves considerations of public safety, but surely that
would not be a ground for holding that the Provincial
Legislature is not competent to make laws for the
maintenance of public order. It is worthy of note that,
apart from the general subject, of ‘Public Order’
CA Nos. 6124-6131 of 2023 & Connected Matters Page 204 of 269
mentioned in item 1 of the Provincial Legislative List,
one particular aspect of public order namely, preventive
detention for reasons connected with the maintenance
of public order, is specifically mentioned. I emphasise
the words “for reasons connected with the
maintenance of public order” One of the reasons
connected with the maintenance of public order may
well, be public safety. If we consider the scope and
purpose of the Act as a whole, then the conclusion at
which one is bound to reach is that in its true nature
and character it deals with the maintenance of public
order involving, no doubt, considerations of public
safety as well. In the context in which the expression
“public safety” occurs in the preamble and in section
2(1) of the Act, it is either synonymous with public order
or is comprehended by the more general term “Public
Order” and the use of the word ‘and’ is not disjunctive.
I do not think that there is any encroachment on item 1
of the Federal Legislative List which deals with, inter
alia, preventive detention in British India for reasons of
State connected with defence, external affairs, etc. That
item may also have an aspect of public safety, but of a
different character altogether, being connected with
defence, external affairs, or the discharge of the
functions of the Crown in the relation to the Indian
States. Learned Counsel for the petitioners has relied
on certain observations made by his Lordship Zafrulla
Khan, J., in the case of King-Emperor v. Sibnath
Banerjeei [(1943) 24 Pat. L.T. 332, P.C.]. The
observations will be found at page 345. His Lordship
said as follows:— “The argument before us was limited
to the ground that ‘public safety or interest’ was not one
of the heads specified in entry no. 1 of List I or entry
no. 1 of List II of the Seventh Schedule to the
Constitution Act as subjects in respect of which Indian
legislation might provide for ‘preventive detention’. The
judgment of this Court in Talpade's case [(1943) 24 Pat.
L.T. 158, F.C.] , clearly proceeded on the footing that
such legislation was covered by the two entries. We
think that the expressions ‘reasons of State connected
with defence’ and ‘reasons connected with the
maintenance of public order’ are wide enough to
include ‘public safety or interest’.” It is contended that
those observations show that ‘public safety’ was
considered to be covered by the two items in the two
CA Nos. 6124-6131 of 2023 & Connected Matters Page 205 of 269
lists taken together, and in view of the proclamation of
emergency under section 102 of the Government of
India Act, the Federal Legislature had power then to
make laws for a province with respect to any of the
matters enumerated in the Provincial Legislative List,
but now the Provincial Legislature cannot make laws
with respect to any of the matters enumerated in List I.
I do not read those observations in the sense in which
learned Counsel for the petitioners takes them. The
question before their Lordships was whether section 2
of the Defence of India Act was ultra vires the Indian
Legislature, and it was not necessary for their
Lordships to consider whether the legislation in
question came within List I or List II. It would have been
enough to decide that it came within the subjects
mentioned in either of the two lists or the two lists taken
together. It cannot, therefore, be said that the Federal
Court had decided that public safety as a subject of
legislation would not come within item 1 of List II; on
the contrary, the observation was to the effect that the
expression ‘reasons connected with the maintenance of
public order’ was wide enough to include ‘public safety
or interest’. As I have already stated, many of the
subjects mentioned in the three lists have a ‘public
safety’ aspect and the maintenance of public order
undoubtedly includes, public safety. There are certain
other observations in another decision of the Federal
Court [Kashav Talpade v. King-Emperor [(1943) 24 Pat.
L.T. 158, F.C.] ] on which learned Counsel for the
petitioners places some reliance. These observations
which will be found at pages 173 and 174 of the report
are:— “If a detaining authority gives four reasons for
detaining a man, without distinguishing between them,
and any two or three of the reasons are held to be bad,
it can never be certain to what extent the bad reasons
operated on the mind of the authority or whether the
detention order would have been made at all if only one
or two good reasons had been before them.” These
observations were made with reference to certain
observations made by Chagla, J. (as he then was)
when the case was before the Bombay High Court.
(Emphasis Supplied)
CA Nos. 6124-6131 of 2023 & Connected Matters Page 206 of 269
342. The overlap between public order and public safety has also
been recognised by a seven-Judge Bench of this Court in
Madhu Limaye v. Sub-Divisional Magistrate , reported in
(1970) 3 SCC 746 while explaining the scope of Section 144
of the CrPC. The Court emphasised that disturbances of
public tranquility, including riots and affrays, can lead to the
subversion of public order unless prevented in time. It
described Section 144 as being directed against the menace
of serious disturbances of a grave character, justifying action
on public order grounds.
“24. The gist of action under Section 144 is the urgency
of the situation, its efficacy in the likelihood of being
able to prevent some harmful occurrences. As it is
possible to act absolutely and even ex parte it is
obvious that the emergency must be sudden and the
consequences sufficiently grave. Without it the exercise
of power would have no justification. It is not an
ordinary power flowing from administration but a
power used in a judicial manner and which can stand
further judicial scrutiny in the need for the exercise of
the power, in its efficacy and in the extent of its
application. There is no general proposition that an
order under Section 144, Criminal Procedure Code
cannot be passed without taking evidence: see Mst
Jagrupa Kumari v. Chobey Narain Singh [37 Cr LJ 95]
which in our opinion is correct in laying down this
proposition. These fundamental facts emerge from the
way the occasions for the exercise of the power are
mentioned. Disturbances of public tranquillity, riots
and affray lead to subversion of public order unless
they are prevented in time. Nuisances dangerous to
human life, health or safety have no doubt to be
abated and prevented . We are, however, not
concerned with this part of the section and the validity
of this part need not be decided here. In so far as the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 207 of 269
other parts of the section are concerned the key-note of
the power is to free society from menace of serious
disturbances of a grave character. The section is
directed against those who attempt to prevent the
exercise of legal rights by others or imperil the public
safety and health. If that be so the matter must fall
within the restrictions which the Constitution itself
visualizes as permissible in the interest of public order,
or in the interest of the general public. We may say,
however, that annoyance must assume sufficiently
grave proportions to bring the matter within interests of
public order.”
(Emphasis Supplied)
343. Further, in S. Bagavathy v. State of Tamil Nadu , reported
in 2007 SC OnLine Mad 218 a Full Bench of the Madras
High Court held that public order has comprehensive
meaning to include public safety in relation to maintenance
of public order and explicitly stated that public order, public
safety, public tranquility, and public interest are overlapping
terms. It also clarified that public order need not always be
traced only to violence like riot or insurrection. It concerns
an orderly state of society in which citizens peacefully pursue
normal activities. Relevant paragraphs are reproduced here
below:
“120. In our considered opinion, on the question,
whether the impugned enactment can be sustained
under Entry 1, viz. Public Order, it should be
remembered that public order is an expression of wide
connotation intended to take care of the public safety
for the members of the political society. Therefore , the
public order need not in every case be traced
CA Nos. 6124-6131 of 2023 & Connected Matters Page 208 of 269
either to the security of the State or to the law
and order.
121. Public Order has a comprehensive meaning so as
to include public safety in its relation to the
maintenance of the public order and the maintenance
of the public order involves consideration of the public
safety. The Public order, public safety, public
tranquility and the public interest are all overlapping
terms with each other. The expression public order
therefore requires the very wide connotation. The public
order is the basic need in any organised society. It
implies orderly state of society and community in which
citizens can peacefully pursue their normal activities of
life. Therefore, it may not be proper to read the public
order only with reference to insurrection, riot,
turbulence or the crimes of violence. Hence, the public
order in Entry 1 of List II, must be interpreted to include
the public safety in its relation to the maintenance of
the public order.”
(Emphasis Supplied)
d. Even Tempo of the Life of the Community, Potentiality
Test
344. The test of “even tempo” formulation has become one of the
most widely cited tests for separating public order from
ordinary issues of law and order. This test was
authoritatively laid down by this Court in Arun Ghosh v.
State of West Bengal, reported in (1970) 1 SCC 98 where
it held that public order is the “even tempo of life of the
community” in a specified locality and that disturbance of
public order must be distinguished from acts directed
CA Nos. 6124-6131 of 2023 & Connected Matters Page 209 of 269
against individuals which do not disturb society to the extent
of causing a general disturbance of public tranquility.
345. While noting the thin line between disruption of ‘law and
order’, and disruption of ‘public order’, this Court in Arun
Ghosh (supra) observed that every infraction of law does
necessarily affect public order, but an action affecting law
and order may not necessarily affect public order. On the
same line then, an act affecting public order need not
necessarily affect the security of the State. It is sufficient if it
affects a section of the society at large. On this premise, the
Court went on to hold that the true test does not lie in the
kind of disorder but rather the potentiality of the act, in
question. In the Court’s view, one act may affect only
individuals, while the other though of a similar kind may
have such an impact that it would disturb the even tempo of
the life of the community.
“3. The submission of the counsel is that these are
stray acts directed against individuals and are not
subversive of public order and therefore the detention
on the ostensible ground of preventing him from acting
in a manner prejudicial to public order was not
justified. In support of this submission reference is
made to three cases of this Court: Dr Ram Manohar
Lohia v. State of Bihar [(1966) 1 SCR 709] ; Pushkar
Mukherjee v. State of W.B. [ WP No. 179 of 1968,
decided on November 7, 1968 : (1969) 1 SCC 10]
and Shyamal Chakraborty v. Commissioner of Police,
Calcutta [WP No. 102 of 1969, decided on August 4,
CA Nos. 6124-6131 of 2023 & Connected Matters Page 210 of 269
1969 : (1969) 2 SCC 426] . In Dr Ram Manohar Lohia
case [(1966) 1 SCR 709] this Court pointed out the
difference between maintenance of law and order and
its disturbance and the maintenance of public order
and its disturbance. Public order was said to embrace
more of the community than law and order. Public order
is the even tempo of the life of the community taking the
country as a whole or even a specified locality.
Disturbance of public order is to be distinguished from
acts directed against individuals which do not disturb
the society to the extent of causing a general
disturbance of public tranquillity. It is the degree of
disturbance and its affect upon the life of the
community in a locality which determines whether the
disturbance amounts only to a breach of law and order.
Take for instance, a man stabs another. People may be
shocked and even disturbed, but the life of the
community keeps moving at an even tempo, however
much one may dislike the act. Take another case of a
town where there is communal tension. A man stabs a
member of the other community. This is an act of a very
different sort. Its implications are deeper and it affects
the even tempo of life and public order is jeopardized
because the repercussions of the act embrace large
sections of the community and incite them to make
further breaches of the law and order and to subvert
the public order. An act by itself is not determinant of
its own gravity. In its quality it may not differ from
another but in its potentiality it may be very different.
Take the case of assault on girls. A guest at a hotel may
kiss or make advances to half a dozen chamber maids.
He may annoy them and also the management but he
does not cause disturbance of public order. He may
even have a fracas with the friends of one of the girls
but even then it would be a case of breach of law and
order only. Take another case of a man who molests
women in lonely places. As a result of his activities girls
going to colleges and schools are in constant danger
and fear. Women going for their ordinary business are
afraid of being waylaid and assaulted. The activity of
this man in its essential quality is not different from the
act of the other man but in its potentiality and in its
affect upon the public tranquillity there is a vast
difference. The act of the man who molests the girls in
lonely places causes a disturbance in the even tempo
CA Nos. 6124-6131 of 2023 & Connected Matters Page 211 of 269
of living which is the first requirement of public order.
He disturbs the society and the community. His act
makes all the women apprehensive of their honour and
he can be said to be causing disturbance of public order
and not merely committing individual actions which
may be taken note of by the criminal prosecution
agencies. It means therefore that the question whether
a man has only committed a breach of law and order
or has acted in a manner likely to cause a disturbance
of the public order is a question of degree and the extent
of the reach of the act upon the society. The French
distinguish law and order and public order by
designating the latter as order publique. The latter
expression has been recognised as meaning something
more than ordinary maintenance of law and order.
Justice Ramaswami in Writ Petition No. 179 of 1968
drew a line of demarcation between the serious and
aggravated forms of breaches of public order which
affect the community or endanger the public interest at
large from minor breaches of peace which do not affect
the public at large. He drew an analogy between public
and private crimes. The analogy is useful but not to be
pushed too far. A large number of acts directed against
persons or individuals may total up into a breach of
public order. In Dr Ram Manohar Lohia case examples
were given by Sarkar and Hidayatullah, JJ. They show
how similar acts in different contexts affect differently
law and order on the one hand and public order on the
other. It is always a question of degree of the harm and
its affect upon the community. The question to ask is:
Does it lead to disturbance of the current of life of the
community so as to amount a disturbance of the public
order or does it affect merely an individual leaving the
tranquillity of the society undisturbed? This question
has to be faced in every case on facts. There is no
formula by which one case can be distinguished from
another.”
(Emphasis Supplied)
346. This Court reiterated this “current of life” standard in Kanu
Biswas v. State of West Bengal , reported in ( 1972) 3 SCC
831 and distinguished ‘law and order’ from ‘public order’ on
CA Nos. 6124-6131 of 2023 & Connected Matters Page 212 of 269
the basis of whether something leads to disturbance of the
current life of the community so as to amount to a
disturbance of the public order or does it affect merely an
individual leaving the tranquillity of the society undisturbed.
The dictum laid down vide para 7 of the judgments, as
reproduced below, bottles down to a question of ‘degree’ and
‘extent of the reach’ of the act upon the society.
“7. The question whether a man has only committed a
breach of law and order or has acted in a manner likely
to cause a disturbance of the public order, according to
the dictum laid down in the above case, is a question
of degree and the extent of the reach of the act upon the
society. Public order is what the French call “order
publique” and is something more than ordinary
maintenance of law and order. The test to be adopted
in determining whether an act affects law and order or
public order, as laid down in the above case, is: Does it
lead to disturbance of the current of life of the
community so as to amount to a disturbance of the
public order or does it affect merely an individual
leaving the tranquillity of the society undisturbed?
(Emphasis Supplied)
347. What follows from the decision in Arun Ghosh (supra) is
essentially that an act by itself is not determinant of its own
gravity because the same conduct may have radically
different public-order implications depending on the
circumstances. Consequently, the Court had stressed that
the question is always one of degree of harm and the act’s
effect upon the community in a locality. The same approach
CA Nos. 6124-6131 of 2023 & Connected Matters Page 213 of 269
was applied by this Court in Nagendra Nath Mondal v.
State of W.B., reported in (1972) 1 SCC 498 , where the
Court held that an attack on an educational institution, in
the course of which its registers and other papers were
destroyed by acts of arson, falls within the area of public
order although it was aimed at an individual entity because
of its potentiality to cause reverberations affecting the even
tempo of community life.
“8. The detention order, no doubt, mentioned that it
was issued with a view to prevent the detenu acting
prejudicially to the maintenance of public order. The
contention raised by counsel, however, involves the
question whether the acts alleged against the detenu
constituted breach of public order or were such as
would be prejudicial to its maintenance. As to what is
meant by the expression, “public order”, Hidayatullah,
J., (as he then was) in Lohia v. State [(1966) 1 SCR 709
: AIR 1966 SC 740] said that any contravention of law
always affected order, but before it could be said to
affect “public order”, it must affect the community or the
public at large. He considered three concepts viz. “law
and order”, “public order” and “the security of the
state” generally used in preventive detention measures
and suggested that to appreciate the scope and extent
of each of them, one should imagine three concentric
circles, the largest of them representing “law and
order”, the next representing “public order” and the
smallest representing “the security of the state”. An act
might affect “law and order”, but not “public order”, just
as an act might affect public order but not “the security
of the state”. Therefore, if the detention order were to
use the expression “maintenance of law and order”,
that would be widening the scope of the detaining
authority, if the statute concerned confined that power
in relation to acts prejudicial to “the maintenance of
public order”. A similar distinction was also drawn
in Pushkar Mukherjee v. West Bengal [(1969) 1 SCC 10
CA Nos. 6124-6131 of 2023 & Connected Matters Page 214 of 269
: (1969) 2 SCR 635] where Ramaswami J. observed
that the expression “public order” in Section 3(1) of the
Preventive Detention Act, 1950, did not take in every
kind of infraction of law. An assault by one on another
in a house or even in a public street might create
disorder but not public disorder, for the latter was one
which affected the community or the public at large.
Therefore, a line of demarcation must be drawn
between serious and aggravated forms of disorder
which affect the community or injure the public interest
and the relatively minor breaches of peace of a purely
local significance which primarily injure specific
individuals and only in consider sense public interest.
A mere disturbance of law and order leading to
disorder was, thus, not necessarily sufficient for action
under the Preventive Detention Act, but a disturbance
which would affect public order fell within the scope of
the Act.
9. But in Arun Ghosh v. West Bengal [(1970) 1 SCC 98
: (1970) 3 SCR 288] it was pointed out that the true
distinction between the areas of “law and order” and
“public order” was one of degree and extent of the
reach of the act in question upon society. Acts similar
in nature, be committed in different contexts and
circumstances might cases different reactions; in one
case it might affect the problem of the breach of law
and order, and in another the breach of public order.
The analogy resorted to by Ramaswami, J., of crimes
against individuals and crimes against the public,
though useful to a limited extent, would not always be
apt. An assault by one individual upon another would
affect law and order only and cause its breach. A
similar assault by a member of one community upon a
leading individual of another community, though
similar in quality, would differ in potentiality in the
sense that it might cause reverberations which might
affect the even tempo of the life of the community. As
the Court pointed out, “the act by itself is not
determinant of its own gravity. In its quality it may not
differ but in its potentiality it may be very different.” At
the same time, the power of detention having been
permitted to the State under the Constitution as an
exceptional power, its exercise had to be scrutinised
with extreme care and could not be used as a
CA Nos. 6124-6131 of 2023 & Connected Matters Page 215 of 269
convenient substitute for the normal processes of the
criminal law of the country. (Cf. S.K.
Saha v. Commissioner of Police, Calcutta). [(1970) 1
SCC 149 : (1970) 3 SCR 360].
10. These are all cases under the Preventive Detention
Act, 4 of 1950, which by Section 3 of it confers power
of detention on specified grounds which include acts
prejudicial to the maintenance of public order. The
present Act likewise confers such power with a view to
prevent a person from acting in any manner prejudicial
to the security of the State or the maintenance of public
order under its Section 3(1). Though the Act does not
define the expression “public order”, it does define the
expression “acting in any manner prejudicial to the
security of the State or the maintenance of public
order”. That expression under the definition inter alia
means “committing mischief within the meaning of
Section 425 of the Penal Code, 1860, by fire or any
explosive substance on any property of Government or
any local authority or any corporation owned or
controlled by Government or any University or other
educational institution, or on any public building where
the commission of such mischief disturbs or is likely to
disturb public order....” The definition itself thus draws
a distinction between mischief by fire or explosive
substance upon property of one of the specified
categories and such mischief upon any such properties
which disturbs or is likely to disturb public order. The
former, however reprehensible, would be taken care of
by the Penal Code, and it is only in respect of the latter
that the drastic power of detention without trial
conferred by the first sub-section can be validly
exercised. But to the extent that the expression “public
order' is not defined here also, decisions under Act 4 of
1950 delineating the sphere of “public order” from
those of “maintenance of law and order” and “the
security of the State” would still be of utility.
11. The acts alleged against the petitioner in the
grounds for detention are acts which fall under Section
3(2)(b), in that, they constitute mischief by fire and by
explosive substance on property of an educational
institution. But the question is whether these acts
disturbed or were likely to disturb public order; in the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 216 of 269
words of Hidayatullah, C.J., in Arun Ghosh v. West
Bengal case, disturb the even tempo of the life of the
community of that specified locality. The distinction
drawn by clause (b) of Section 3(2) then is between
causing fire, for instance, to a building of an
educational institution simpliciter, and committing
mischief of the same nature but such that it disturbs or
is likely to disturb the even tempo of the community in
that particular locality.
12. The grounds set out two acts alleged against the
petitioner. The first, of December 1, 1970, was that the
petitioner and some others trespassed after midnight
into the Headmaster's room in the Moynaguri Higher
Secondary School and set fire to books, registers,
furniture etc. and then placed a bomb in the school
building thereby endangering the life of the teaching
staff and the students attending the school. The
second, of April 5, 1970, was that the petitioner along
with some others again trespassed into the same
school and set fire to parts of it and then threatened the
members of its staff with death if they offered
resistance or disclosed his name to any authority.
13. The target of arson, (assuming the allegations to be
true which we have to assume) was an educational
institution and particularly the registers and other
papers maintained by it. The object obviously was
vandalism, to disrupt its working by burning its records
and to create a scare so that neither the teaching staff
nor the pupils would dare attend it for prosecution of
studies. The parents dare not hence-forth send their
wards for fear that the school might be set on fire while
they are in it. The bomb was manifestly placed in the
premises for creating that scare. It could not have been
intended for any other purpose after the records and
furniture had been set on fire. In these circumstances,
the alleged acts did not merely constitute mischief
under Section 425 of the Penal Code, but constituted
such mischief which disturbed or was likely to disturb
public order. The acts in question, no doubt, would be
acts similar to those committed by a person who resorts
to arson, but in the circumstances were acts different
in potentiality, and therefore, fell within the definition
CA Nos. 6124-6131 of 2023 & Connected Matters Page 217 of 269
in Section 3(2)(b). The first argument urged on behalf of
the petitioner must, consequently, fail.”
(Emphasis Supplied)
348. Similarly, in Amiya Kumar Karmakar v. State of W.B.,
reported in (1972) 2 SCC 672 , this Court reiterated this test
and held that even though the alleged act of killing might
appear as a crime against an individual, its political-
ideology-driven purpose to terrorize non-adherents and
thereby cause panic and abandonment of normal activities
transforms its impact into one striking at public order. The
relevant paragraphs are reproduced below:
“6. As to the proper connotation and the scope of the
concept of public order, as distinguished from the
concepts of law and order and security of State, the Act
furnishes no dictionary. But these three concepts have
by now been matters of discussion in several
judgments of this Court wherein a clear differentiation
of one from the other has been elucidated. Such
differentiation was illustrated in some cases by means
of three imaginary concentric circles, the narrowest of
them being that relating to the security of the State, the
next being that pertaining to public order, and the third,
the largest, being that pertaining to law and order.
(See Lohia v. State. [AIR 1966 SC 740 : (1966) 1 SCR
709: (1966) 2 SCJ 549] ) In other cases, the
differentiation was sought to be made on the basis of
the degree of disorder affecting, in one case the
community at large, and in other, specific individuals,
and only in a secondary sense public order in other
words, between crimes against specific individuals and
crimes against the public. Such a distinction appears at
first sight attractive by reason of the simplicity of its
test, but on a closer examination of it fails to cover
cases which are marginal and sometimes overlapping.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 218 of 269
As pointed out in Arun Ghosh v. West Bengal [(1970) 1
SCC 98 : (1970) 3 SCR 288] the true distinction between
the areas of law and order and public order lies not
merely in the nature or quality of the act, but in the
degree and extent of its reach upon society. Acts similar
in nature, but committed in different contexts and
circumstances, might cause different reactions. In one
case it might affect specific individuals only, and
therefore touches the problem of law and order only,
while in another it might affect public order. The Act by
itself, therefore, is not determinant of its own gravity.
In its quality it may not differ from other similar acts,
but in its potentiality, that is, in its impact on society, it
may be very different. On the basis of such a
distinction, an attack on an educational institution, in
the course of which its registers and other papers were
destroyed by acts of arson, was held to fall within the
area of public order although it was aimed at an
individual entity. (See Nagendra Nath Mondal v. West
Bengal. [(1972) 1 SCC 498 : 1972 SCC (Cri) 227] ) The
criterion thus being the potentiality of the Act in
question or the degree of its impact on members of the
community in the locality in which the act in question is
committed, examination of Ground 2 from that angle
would appear to be more appropriate.
7. The act in Ground 2, no doubt, was an attack
resulting in the death of the victim, and though it was
said to have been committed by the petitioner along
with his associates it would prima facie appear to be
an act against a specific individual, involving infraction
of law and order only. The act in question was similar
in nature and quality to other such acts committed by
one or more individuals against another resulting in the
death of the latter. But it was not committed on account
of any animus against the victim or for a motive such
as personal vendetta. As the ground of detention
asserts, it was committed with a view to promote a
particular political ideology, that is to say against one
who did not subscribe to the ideology and as a warning
against those who did not agree with or subscribe to
such ideology. Obviously, it was intended to and did in
fact terrorise those who did not conform to that
ideology, who out of panic abandoned their normal
activities for fear that any one or more of them would
CA Nos. 6124-6131 of 2023 & Connected Matters Page 219 of 269
be the target of such an attack. Viewed from this angle
it is difficult to regard such an act as a mere infraction
of law and order, for, such an act committed with such
an intent and object and in such circumstances is one
which strikes at the normal, orderly life of the
community in that locality. Its impact and potentiality
thus affect public order in the sense that it was aimed
at bringing about disorder and chaos upsetting the
even tempo of life in that locality. It is, therefore, not
possible to agree with the proposition that it affected
the problem of law and order only and was for that
reason extraneous or irrelevant to the object specified
in Section 3 of the Act, in relation to which only a valid
order of detention thereunder could be made.”
(Emphasis Supplied)
e. “Concentric Circles” Doctrine
349. A foundational doctrinal tool for interpreting public order is
the three concentric circles rule. This was first laid down in
Ram Manohar Lohia v. State of Bihar , reported in 1965
SCC OnLine SC 9 wherein this Court held that “law and
order” is the widest circle, “public order” is a narrower circle
within it, and “security of the State” is the narrowest circle.
Thus, every infraction may affect law and order, but only
those with broader societal impact implicate public order;
and only the gravest threats implicate security of the State.
It was observed that an act may disturb law and order
without disturbing public order the remit of public order
cannot be widened.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 220 of 269
“53. These observations determine the meaning of the
words “public order” in contradistinction to expressions
such as “public safety”, “security of the State”. They
were made in different contexts. The first three cases
dealt with the meaning in the legislative lists as to
which, it is settled, we must give as large a meaning as
possible. In the last case the meaning of “public order”
was given in relation to the necessity for amending the
Constitution as a result of the pronouncements of this
Court. The context in which the words were used was
different, the occasion was different and the object in
sigh was different.
54. We have here a case of detention under Rule 30 of
the Defence of India Rules which permits apprehension
and detention of a person likely to act in a manner
prejudicial to the maintenance of public order. It follows
that if such a person is not detained public disorder is
the apprehended result. Disorder is no doubt prevented
by the maintenance of law and order also but disorder
is a broad spectrum which includes at one end small
disturbances and at the other the most serious and
cataclysmic happenings. Does the expression “public
order” take in every kind of disorders or only some of
them? The answer to this serves to distinguish “public
order” from “law and order” because the latter
undoubtedly takes in all of them. Public order if
disturbed, must lead to public disorder. Every breach
of the peace does not lead to public disorder. When two
drunkards quarrel and fight there is disorder but not
public disorder. They can be dealt with under the
powers to maintain law and order but cannot be
detained on the ground that they were disturbing
public order. Suppose that the two fighters were of rival
communities and one of them tried to raise communal
passions. The problem is still one of law and order but
it raises the apprehension of public disorder. Other
examples can be imagined. The contravention of law
always affects order but before if can be said to affect
public order, it must affect the community or the public
at large. A mere disturbance of law and order leading
to disorder is thus not necessarily sufficient for action
under the Defence of India Act but disturbances which
subvert the public order are. A District Magistrate is
entitled to take action under Rule 30(1)(b) to prevent
CA Nos. 6124-6131 of 2023 & Connected Matters Page 221 of 269
subversion of public order but not in aid of maintenance
of law and order under ordinary circumstances.
55. It will thus appear that just as “public order” in the
rulings of this Court (earlier cited) was said to
comprehend disorders of less gravity than those
affecting “security of State”, “law and order” also
comprehends disorders of less gravity than those
affecting “public order”. One has to imagine three
concentric circles. Law and order represents the largest
circle within which is the next circle representing public
order and the smallest circle represents security of
State. It is then easy to see that an act may affect law
and order but not public order just as an act may affect
public order but not security of the State. By using the
expression “maintenance of law and order” the District
Magistrate was widening his own field of action and
was adding a clause to the Defence of India Rules.”
(Emphasis Supplied)
350. This Court has also reiterated that mere contraventions like
cheating or criminal breach of trust ordinarily implicate ‘law
and order’ violations and cannot automatically be elevated
to ‘public order’ unless community-wide impact is shown.
This was emphasised in Banka Sneha Sheela v. State of
Telangana , reported in (2021) 9 SCC 415 which re-stated
that “public order” disturbance requires “public disorder”
and community-level impact vide paragraphs 3 and 14:
“3. As is well-known, the expressions “law and order”,
“public order”, and “security of State” are different from
one another. In Ram Manohar Lohia v. State of
Bihar [Ram Manohar Lohia v. State of Bihar, (1966) 1
SCR 709 : AIR 1966 SC 740 : 1966 Cri LJ 608] the
question before this Court arose under a preventive
detention order made under Rule 30 of the Defence of
India Rules, which permits apprehension and detention
CA Nos. 6124-6131 of 2023 & Connected Matters Page 222 of 269
of a person likely to act in a manner prejudicial to the
maintenance of public order. This Court set out the
distinction between a mere law and order disturbance
and a public order disturbance as follows : (SCR pp.
738-39 & 745-46 : AIR pp. 755 & 758-59, paras 42 &
51-52)
“42. The Defence of India Act and the Rules speak
of the conditions under which preventive detention
under the Act can be ordered. In its long title and
the preamble the Defence of India Act speaks of
the necessity to provide for special measures to
ensure public safety and interest, the defence of
India and civil defence. The expression “public
safety” and interest between them indicate the
range of action for maintaining security, peace and
tranquillity of India whereas the expressions
“defence of India” and “civil defence” connote
defence of India and its people against aggression
from outside and action of persons within the
country. These generic terms were used because
the Act seeks to provide for a congeries of action of
which preventive detention is just a small part. In
conferring power to make rules, Section 3 of the
Defence of India Act enlarges upon the terms of the
preamble by specification of details. It speaks of
defence of India and civil defence and public
safety without change but it expands the idea of
public interest into maintenance of public order,
the efficient conduct of military operations and
maintaining of supplies and services essential to
the life of the community. Then it mentions by way
of illustration in clause (15) of the same section the
power of apprehension and detention in custody of
any person whom the authority empowered by the
rules to apprehend or detain (the authority
empowered to detain not being lower in rank than
that of a District Magistrate), suspects, on grounds
appearing to that authority to be reasonable—
(a) of being of hostile origin; or
(b) of having acted, acting or being about
to act or being likely to act in a manner
prejudicial to—
(i) the defence of India and civil defence;
(ii) the security of the State;
(iii) the public safety or interest;
CA Nos. 6124-6131 of 2023 & Connected Matters Page 223 of 269
(iv) the maintenance of public order;
(v) India's relations with foreign States;
(vi) the maintenance of peaceful
conditions in any part or area of India; or
(vii) the efficient conduct of military
operations.
It will thus appear that security of the
State, public safety or interest,
maintenance of public order and the
maintenance of peaceful conditions in
any part or area of India may be viewed
separately even though strictly one
clause may have an effect or bearing on
another. Then follows Rule 30, which
repeats the above conditions and permits
detention of any person with a view to
preventing him from acting in any of the
above ways. The argument of Dr Lohia
that the conditions are to be cumulatively
applied is clearly untenable. It is not
necessary to analyse Rule 30 which we
quoted earlier and which follows the
scheme of Section 3(15). The question is
whether by taking power to prevent Dr
Lohia from acting to the prejudice of “law
and order” as against “public order” the
District Magistrate went outside his
powers.
*
51. We have here a case of detention under Rule
30 of the Defence of India Rules which permits
apprehension and detention of a person likely to
act in a manner prejudicial to the maintenance of
public order. It follows that if such a person is not
detained public disorder is the apprehended
result. Disorder is no doubt prevented by the
maintenance of law and order also but disorder
is a broad spectrum which includes at one end
small disturbances and at the other the most
serious and cataclysmic happenings. Does the
expression “public order” take in every kind of
disorders or only some of them? The answer to
this serves to distinguish “public order” from “law
and order” because the latter undoubtedly takes
in all of them. Public order if disturbed, must lead
CA Nos. 6124-6131 of 2023 & Connected Matters Page 224 of 269
to public disorder. Every breach of the peace does
not lead to public disorder. When two drunkards
quarrel and fight there is disorder but not public
disorder. They can be dealt with under the
powers to maintain law and order but cannot be
detained on the ground that they were disturbing
public order. Suppose that the two fighters were
of rival communities and one of them tried to raise
communal passions. The problem is still one of
law and order but it raises the apprehension of
public disorder. Other examples can be imagined.
The contravention of law always affects order but
before if can be said to affect public order, it must
affect the community or the public at large. A
mere disturbance of law and order leading to
disorder is thus not necessarily sufficient for
action under the Defence of India Act but
disturbances which subvert the public order are.
A District Magistrate is entitled to take action
under Rule 30(1)(b) to prevent subversion of
public order but not in aid of maintenance of law
and order under ordinary circumstances.
52. It will thus appear that just as “public order”
in the rulings of this Court (earlier cited) was said
to comprehend disorders of less gravity than
those affecting “security of State”, “law and
order” also comprehends disorders of less gravity
than those affecting “public order”. One has to
imagine three concentric circles. Law and order
represents the largest circle within which is the
next circle representing public order and the
smallest circle represents security of State. It is
then easy to see that an act may affect law and
order but not public order just as an act may
affect public order but not security of the State.
By using the expression “maintenance of law and
order” the District Magistrate was widening his
own field of action and was adding a clause to
the Defence of India Rules.”
xxx xxx xxx
14. There can be no doubt that for “public order” to be
disturbed, there must in turn be public disorder. Mere
contravention of law such as indulging in cheating or
criminal breach of trust certainly affects “law and
CA Nos. 6124-6131 of 2023 & Connected Matters Page 225 of 269
order” but before it can be said to affect “public order”,
it must affect the community or the public at large.”
(Emphasis Supplied)
f. Social and Economic Disorder
351. A significant expansion to the expression ‘public order’ by
this Court is that disturbances in public order are not
confined to traditional violent law-and-order breakdowns
alone but that it also extends to social and economic
disorders. In S. Bagavathy v. The State of Tamil Nadu
reported in (2007) 2 CTC 207 , the full Bench of the Madras
High Court dealt with the constitutional validity of the Tamil
Nadu Protection of Interests of Depositors, 1997 (“ TNPID
Act ”), which was enacted to protect vulnerable depositors
from fraudulent financial establishments that defaulted on
repayments, causing public resentment. The legislative
competence of the Act was challenged on the ground that
banking is a Union subject.
352. The High Court, therefore, dealt with the question of whether
the TNPID Act providing for companies to deposit money
would qualify as ‘banking activity’ and therefore be rendered
unconstitutional for being ultra vires of the power of the state
legislature. In answering this question, the Court held that
CA Nos. 6124-6131 of 2023 & Connected Matters Page 226 of 269
the Act’s true nature was not to regulate banking, but to
maintain public order and address delinquency in
unincorporated finance, which falls under the State List. The
State acted within its competence as parens patriae
(guardian) to protect depositors.
353. Applying the test of potentiality of the Act to disturb the even
tempo of community life, the High Court went on to hold that
public order is the basic need in organised society and that
every breach of tranquility in social or economic spheres may
involve breach of public order where it shakes societal order.
“122. All and every breach of tranquility, whether in
social or economic sphere of life of citizens, would
involve breach of public order and therefore, the field of
the legislation of the State Government to enact
appropriate legislation in the matter affecting economic
and social disorders which ultimately shake the public
order, unless and otherwise it is traceable to the
security of the State, the use of any Naval, Military and
Air Force or any other armed force of the Union of India,
cannot be curtailed by the Court on the ground of
legislative competency.
123. While the law and order forms the largest
concentric circle and the next represents the public
order, the smallest represents the security of the State.
Therefore, every infraction of law must necessarily
affect the public order. But, an Act affecting the law and
order may not necessarily affect the public order.
Likewise, an Act which may affect the public order
need not necessarily affect the security of the State.
Therefore, the true test is not the kind of disorder but
the potentiality of the Act in question. One Act may
affect only individuals, while the other though of a
similar kind may have such an impact that it would
CA Nos. 6124-6131 of 2023 & Connected Matters Page 227 of 269
disturb the even tempo of the life of the community
[vide Arun Gosh v. State of West Bengal ((1970) 1 SCC
98].
124. But, this does not mean that there can be no
overlapping, in the sense that an act cannot fall under
two concepts at the same time. An act for instance
affecting the public order may have an impact that it
would affect both public order and the security of the
State. In such a case the power can be exercised on
both grounds viz. disturbance of the public order and
danger to the security of the State [Vide Kishori Mohan
Bera v. State of West Bengal, (1972) 3 SCC
845, Nathulal Govindji Jhagada v. State of Gujarat,
(1981) 22 Guj LR 503]. Therefore, the public order
postulates a synonymous with public safety and public
interest. Hence, the problem of the depositors is the
problem of the public and it cannot be decided
numerically.
125. A serious contention was raised to the effect that
public order is one as stated in the statement of objects
and reasons in Act 14 of 1982 and therefore, public
order is totally a different concept; that there should be
actual physical force to danger to life and property or
there should be threat to life and property; and that
since the framers of Constitution originally included
preventive detention, but the same was subsequently
taken away and in that context, public order should be
looked into. But, we are unable to appreciate such
contention, because the Apex Court in State of
U.P. v. Sanjai Pratap Gupta, (2004) 8 SCC 591,
following its earlier decision in Arun Gosh v. State of
West Bengal, referred supra, held that Public order, law
and order and the security of the State fictionally draw
three concentric circles, the largest representing law
and order, the next representing public order and the
smallest representing security of the State. Every
infraction of law must necessarily affect order, but an
act affecting law and order may not necessarily also
affect public order. Likewise, an act may affect public
order, but not necessarily the security of the State. The
true test is not the kind, but the potentiality of the act
in question. One act may affect only individuals while
the other, though of a similar kind, may have such an
CA Nos. 6124-6131 of 2023 & Connected Matters Page 228 of 269
impact that it would disturb the even tempo of the life
of the community. This does not mean that there can be
no overlapping, in the sense that an act cannot fall
under two concepts at the same time. An act, for
instance, affecting public order may have an impact
that it would affect both public order and the security
of the State.
126. It can, therefore, be concluded that the Tamil Nadu
Act is traceable to Entry 1 of the State List. For this view
support can also be had from the decision of the Apex
Court in Romesh Thappar v. State of Madras, AIR 1950
SC 124 = (1950) 63 L.W. 929, wherein it is held as
under: …
129. If that be so, under the facts and circumstances
and the societal realities for enacting the impugned Act,
which is intended to safeguard the social and economic
interest of the innocent depositors, won't the grievance
of the depositors which rippled violently unset the
public order in the society creating a social and
economic disorder? Answering affirmatively, we do
find force in the submissions made on behalf of the
State Government that the legislative competency of the
State is traceable to Entry 1 of List II which deals with
“public order” apart from Entry 32 which regulates the
activities of the financial establishments, to monitor
them to rescue the depositors.
130. Piercing the veil of legalese, the core question is
the degree of social control imposed by the State and
resisted at every turn by the financial establishments.
In pith and substance, we are also satisfied that the
impugned Act is meant for public safety and public
interest and to regulate the unincorporated trading and
finance. This leads to the next question whether public
order includes public interest and public safety.
131. The sad situation of the depositors is that the high
priority promise of independence laws directed to
agrarian reforms rolled out from State legislatures in
quick succession. Urban elite found it disadvantageous
to invest their savings in agricultural land. It is said
that Rent Restriction Acts were a disincentive for
investment in urban house property. Gold Control
CA Nos. 6124-6131 of 2023 & Connected Matters Page 229 of 269
measures dried up gold as a
venue of investment of savings. Bank interests were
discouraging. Social security in old age being niggardly
or non-existent, there was fascinating attraction for
deposits in non-banking companies.
132. On the other hand, the attempt of the financiers
exploiting the anguish of the depositors, is nothing but
a notorious abuse of the innocent desire of the
depositors for higher rate of interest for the small
savings that they invested, for which they have been
given a small passbook as a token of their
acknowledgment, which they consider as a passport
for their children higher education in some cases, or
wedding of daughters in some other, and as a policy
medical insurance in the case of most of the aged
retired depositors, but in reality, in all cases, an
unsecured promise executed on a waste paper. The
senior citizens above 80 years, senior citizens between
60 and 80 years, widows, handicapped, driven out by
wards, retired Government servants and pensioners,
living below the poverty line, and similarly placed
persons constitute the community of depositors. If their
grievance is not taken as public interest, or public
safety, the words, ‘public safety’ and ‘public interest’
would be only dead letters. Is it not the duty of the
State to curb such mismanagement and malpractice
indulged by the financial establishments adopting
unscrupulous attempt?
133. Obviously there is a social anguish to curb
exploitation of the depositors by these financial
establishments, to prevent and protect the precarious
loss of the depositors and to recover the same as much
as possible. The unsecured depositors themselves
cannot, without the aid of the State, find a solution for
their grief, by taking a recourse under the legal
proceedings ordinarily available to them, but for the
impugned enactment. Otherwise, it would only render
them to abandon their sugar coated promises and
make recourse to conventional legal proceedings,
incurring expenses for Court fee, advocate fee, apart
from the inconvenience involved therein, meeting all
technical objections, giving way for docket explosive
litigations, without tasting the fruits of the same.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 230 of 269
134. Is it possible for those depositors who lost
everything in the hands of the financial establishments
on the tempting and robing in schemes, to fight against
these financial establishments on their legs, without
any aid of the State? No. In our considered opinion, the
State, has rightly come with an enactment to wipe
away the tears of the innocent depositors and to
protect their interest and also to attach the property
immediately and to take effective steps to recover the
amounts diverted and to return as much as possible to
the persons who lost their savings, of course providing
adequate machinery and guidelines for the same, by
protecting the innocent depositors and also genuine
third parties, whose properties are also attached.
135. The State being the custodian of the welfare of the
subjects cannot be a silent spectator without finding a
solution for this gruesome plague. The State therefore
had to awake and protect the vulnerable sector from
the evil hands of the financiers, who have no social
responsibility, but with a lustful desire of easy money
making promising attractive returns for the poor
investors. The noxious net cast by the financial
establishments was large and the State was rightly
moved to stop this menace. Many a little makes a
mickle, and those small sums collected from a
substantial number of subscribers accumulated into
huge resources for the financiers, who ultimately
diverted their collections and converted the deposited
amounts as assets in the names of third parties, and
finally one day attempted to close the financial
establishments, disappointing the innocent depositors.
The grim picture of the entire episode enacted by
financiers is nothing but to gamble upon the
appetite of the innocent depositors for higher
rate of interest and to steal out the entire sterilized
savings of the innocent depositors diplomatically under
the banner of white collar financial establishments,
out of their appetite for higher rate of interest and
finally to siphon of them in entirety. In the
name of attractive rate of interest, the financiers
adopted unique, modus operandi mesmerizing the
depositors to deposit their hard earned money under
different schemes, which are nothing but have an anti-
CA Nos. 6124-6131 of 2023 & Connected Matters Page 231 of 269
social impact on the community at large. Then, is it not
the responsibility of the welfare State, who have owed
to establish/maintain socio-economic justice in the
society?
136. If no law could be made to curb such
activities of the financial establishments effectively
and to realise the dues payable to the depositors, an
anomalous situation would have been created, viz.,
these financial establishments would continue their
business and divert the funds clandestinely by mala
fide transferring and would siphon of the funds of the
depositors, and finally would be prepared to face the
penal action under Section 45-S or 58-B(5-A) of the
Reserve Bank of India Act, 1934, as the case may be,
taking advantage of the loopholes in committing such
white collar offences. But, the depositors would be left
in lurch, with no remedy. To permit such anomalous
situation, in our opinion, would be contrary to the public
interest. Therefore, the element of public order comes
into play sustaining the impugned legislation under
Entry 1 of the List II of VII Schedule.
137. It is settled law that the Courts are concerned only
with the constitutionality, but not with the
wisdom of the legislature or lack of the same which are
essentially for the legislature to determine. The judicial
deference to legislature in the instances of economic
regulation is a well established principle borne
out of the acceptance of reality and Courts, lacking the
capacity to inform themselves fully, about the
peculiarities of a particular local situation, should
hesitate to dub the legislative classification as
irrational, because legislative judgment may respond
closely to local needs and Courts' familiarity to those
needs may be limited, (vide: State of Gujarat v. Shri
Ambica Mills Ltd., AIR 1974 SC 1300).
138. Statutes made for the public good ought to be
liberally construed and in doing so, another principle
should not be lost sight, namely, safety of the people is
the supreme law. Salus Populi est suprema
lex (safety of the people is the supreme). The
Constitution is the documentation of founding
faiths of the nation and the fundamental direction for
CA Nos. 6124-6131 of 2023 & Connected Matters Page 232 of 269
the fulfillment. Therefore, it is not possible to deduce a
limitation from something supposed to be inherent in
the constitution itself. The spirit of Constitution
therefore cannot prevail as against its letter. (vide: A.K.
Gopalan v. State of Madras, 1950 SCC 228 : AIR 1950
SC 27). The legislative competence should be tested by
the spirit of the enactment which vivifies but not by
mere letter. The Courts are not at liberty to declare an
act void based on elusive and unsafe guide.
139. The State, invoking the field of legislation under
Public Order, Entry 1, List II, as a parent of the country,
applying the Doctrine of Parens Patriae, is obligated to
shoulder with the responsibilities in exercise of its
sovereign power and to discharge its duties to protect
the public interest.”
(Emphasis Supplied)
354. The above-referred decision of the Madras High Court in S.
Bagavathy (supra) was subsequently upheld by this Court
in New Horizon Sugar Mills Ltd. v. Govt. of Pondicherry ,
reported in (2012) 10 SCC 575 , wherein this Court affirmed
the validity of depositor-protection legislation and
acknowledged that transaction integrity and protection of
depositors can be deeply relevant to securing public order. It
treated such legislation as relatable to Entry 1 of List II due
to the societal destabilization caused by large-scale depositor
frauds.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 233 of 269
g. Proximate Nexus Requirement
355. Finally, even though “public order” has been consistently
interpreted to be wide in connotation, this Court has also
emphasized the requirement that restrictions or measures
justified on public order grounds must have a real,
proximate connection to the public order sought to be
protected, and not a remote, hypothetical or far-fetched
relation. This requirement was elaborately explained in
Supdt., Central Prison v. Ram Manohar Lohia , reported
in 1960 SCC OnLine SC 43 while interpreting the meaning
of “in the interest of public order” in Article 19(2) of the
Constitution, in the following paragraphs:
“9. We shall now proceed to consider the constitutional
validity of this section. The material portions of the
relevant provisions of the Constitution may now be
read:
“19. (1) All citizens shall have the right—
(a) to freedom of speech and expression;
*
(2) Nothing in sub-clause (a) of clause (1) shall
affect the operation of any existing law, or prevent
the State from making any law, insofar as such
law imposes reasonable restrictions on the
exercise of the right conferred by the said sub-
clause in the interests of the security of the State,
friendly relations with foreign States, public order,
decency or morality, or in relation to contempt of
court, defamation or incitement to an offence.”
clause (2) of Article 19 was amended by the
Constitution (First Amendment) Act, 1951. By this
amendment several new grounds of restrictions upon
the freedom of speech have been introduced, such as
friendly relations with foreign States, public order and
CA Nos. 6124-6131 of 2023 & Connected Matters Page 234 of 269
incitement to an offence. It is self-evident and common
place that freedom of speech is one of the bulwarks of
a democratic form of Government. It is equally obvious
that freedom of speech can only thrive in an orderly
society clause (2) of Article 19, therefore, does not affect
the operation of any existing law or prevent the State
from making any law insofar as such law imposes
reasonable restrictions on the exercise of the right of
freedom of speech in the interest of public order, among
others. To sustain the existing law or a new law made
by the State under clause (2) of Article 19, so far as it
is relevant to the present enquiry, two conditions
should be complied with viz. (i) the restrictions imposed
must be reasonable; and (ii) they should be in the
interests of public order. Before we consider the scope
of the words of limitation, “reasonable restrictions” and
“in the interests of”, it is necessary to ascertain the true
meaning of the expression “public order” in the said
clause. The expression “public order” has a very wide
connotation. Order is the basic need in any organised
society. It implies the orderly state of society or
community in which citizens can peacefully pursue
their normal activities of life. In the words of an eminent
Judge of the Supreme Court of America “the essential
rights are subject to the elementary need for order
without which the guarantee of those rights would be a
mockery”. The expression has not been defined in the
Constitution, but it occurs in List II of its Seventh
Schedule and is also inserted by the Constitution (First
Amendment) Act, 1951 in clause (2) of Article 19. The
sense in which it is used in Article 19 can only be
appreciated by ascertaining how the Article was
construed before it was inserted therein and what was
the defect to remedy which the Parliament inserted the
same by the said amendment. The impact of clause (2)
of Article 19 on Article 19(1)(a) before the said
amendment was subject to judicial scrutiny by this
Court in Romesh Thappar v. State of Madras [(1950)
SCR 594, 600, 601, 602] . There the Government of
Madras, in exercise of their powers under Section 9(1-
A) of the Madras Maintenance of Public Order Act,
1949, purported to issue an order whereby they
imposed a ban upon the entry and circulation of the
journal called the “Cross Roads” in that State. The
petitioner therein contended that the said order
CA Nos. 6124-6131 of 2023 & Connected Matters Page 235 of 269
contravened his fundamental right to freedom of
speech and expression. At the time when that order
was issued the expression “public order” was not in
Article 19(2) of the Constitution; but the words “the
security of the State” were there. In considering
whether the impugned Act was made in the interests of
security of the State, Patanjali Sastri, J., as he then
was, after citing the observation of Stephen in
his Criminal Law of England, states:
“Though all these offences thus involve
disturbances of public tranquillity and are in
theory offences against public order, the difference
between them being only a difference of degree,
yet for the purpose of grading the punishment to
be inflicted in respect of them they may be
classified into different minor categories as has
been done by the Indian Penal Code. Similarly, the
Constitution, in formulating the varying criteria for
permissible legislation imposing restrictions on the
fundamental rights enumerated in Article 19(1),
has placed in a distinct category those offences
against public order which aim at undermining the
security of the State or overthrowing it, and made
their prevention the sole justification for legislative
abridgement of freedom of speech and expression,
that is to say, nothing less than endangering the
foundations of the State or threatening its
overthrow could justify curtailment of the rights to
freedom of speech and expression ….”
The learned Judge continued to state:
“The Constitution thus requires a line to
be drawn in the field of public order or
tranquillity marking off, may be, roughly,
the boundary between those serious and
aggravated forms of public disorder
which are calculated to endanger the
security of the State and the relatively
minor breaches of the peace of a purely
local significance, treating for this
purpose differences in degree as if they
were differences in kind.”
The learned Judge proceeded further to state:
“We are therefore of opinion that unless a
law restricting freedom of speech and
expression is directed solely against the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 236 of 269
undermining of the security of the State or
the overthrow of it, such law cannot fall
within the reservation under clause (2) of
Article 19, although the restrictions which
it seeks to impose may have been
conceived generally in the interests of
public order.”
This decision establishes two propositions viz. (i)
maintenance of public order is equated with
maintenance of public tranquillity; and (ii) the offences
against public order are divided into two categories viz.
(a) major offences affecting the security of the State,
and (b) minor offences involving breach of purely local
significance. This Court in Brij Bhushan v. State of
Delhi [(1950) SCR 605] followed the earlier decision in
the context of Section 7(1)(c) of the East Punjab Public
Safety Act, 1949. Fazl Ali, J., in his dissenting
judgment gave the expression “public order” a wider
meaning than that given by the majority view. The
learned Judge observed at p. 612 thus:
“When we approach the matter in this
way, we find that while ‘public disorder’
is wide enough to cover a small riot or an
affray and other cases where peace is
disturbed by, or affects, a small group of
persons, ‘public unsafety’ (or insecurity of
the State), will usually be connected with
serious internal disorders and such
disturbances of public tranquillity as
jeopardize the security of the State.”
This observation also indicates that “public order” is
equated with public peace and safety. Presumably in
an attempt to get over the effect of these two decisions,
the expression “public order” was inserted in Article
19(2) of the Constitution by the Constitution (First
Amendment) Act, 1951, with a view to bring in offences
involving breach of purely local significance within the
scope of permissible restrictions under clause (2) of
Article 19. After the said amendment, this Court
explained the scope of Romesh Thapper's case [(1950)
SCR 594, 600, 601, 602] in State of Bihar v. Shailabala
Devi [(1952) 2 SCC 22 : (1952) SCR 654] . That case
was concerned with the constitutional validity of
Section 4(1)(a) of the Indian Press (Emergency Powers)
Act, 1931. It deals with the words or signs or visible
CA Nos. 6124-6131 of 2023 & Connected Matters Page 237 of 269
representations which incite to or encourage, or tend to
incite to or encourage the commission of any offence of
murder or any cognizable offence involving violence.
Mahajan, J., as he then was, observed at p. 660:
“The deduction that a person would be
free to incite to murder or other cognizable
offence through the press with impunity
drawn from our decision in Romesh
Thapper case could easily have been
avoided as it was avoided by Shearer, J.,
who in very emphatic terms said as
follows:
‘I have read and re-read the judgments
of the Supreme Court, and I can find
nothing in them myself which bear
directly on the point at issue, and leads
me to think that, in their opinion, a
restriction of this kind is no longer
permissible.’”
The validity of that section came up for consideration
after the Constitution (First Amendment) Act, 1951,
which was expressly made retrospective, and therefore
the said section clearly fell within the ambit of the
words “in the interest of public order”. That apart the
observations of Mahajan, J., as he then was, indicate
that even without the amendment that section would
have been good inasmuch as it aimed to prevent
incitement to murder.
10. The words “public order” were also understood in
America and England as offences against public safety
or public peace. The Supreme Court of America
observed in Cantewell v. Connecticut [(1940) 310 US
296, 308] thus:
“The offence known as breach of the peace embraces a
great variety of conduct destroying or menacing public
order and tranquillity. It includes not only violent acts
and words likely to produce violence in others. No one
would have the hardihood to suggest that the principle
of freedom of speech sanctions incitement to riot …
When clear and present danger of riot, disorder,
interference with traffic upon the public streets, or other
immediate threat to public safety, peace, or order
appears, the power of the State to prevent or punish is
obvious.”
CA Nos. 6124-6131 of 2023 & Connected Matters Page 238 of 269
The American decisions sanctioned a variety of
restrictions on the freedom of speech in the interests of
public order. They cover the entire gamut of restrictions
that can be imposed under different heads in Article
19(2) of our Constitution. The following summary of
some of the cases of the Supreme Court of America
given in a well-known book on Constitutional law
illustrates the range of categories of cases covering that
expression. “In the interests of public order, the State
may prohibit and punish the causing of ‘loud and
raucous noise’ in streets and public places by means of
sound amplifying instruments, regulate the hours and
place of public discussion, and the use of the public
streets for the purpose of exercising freedom of speech;
provide for the expulsion of hecklers from meetings and
assemblies, punish utterances tending to incite an
immediate breach of the peace or riot as distinguished
from utterances causing mere ‘public inconvenience,
annoyance or unrest’”. In England also Acts like Public
Order Act, 1936, Theatres Act, 1843 were passed : the
former making it an offence to use threatening, abusive
or insulting words or behaviour in any public place or
at any public meeting with intent to provoke a breach
of the peace or whereby a breach of the peace is likely
to be caused, and the latter was enacted to authorise
the Lord Chamberlain to prohibit any stage play
whenever he thought its public performance would
militate against good manners, decorum and the
preservation of the public peace. The reason underlying
all the decisions is that if the freedom of speech was
not restricted in the manner the relevant Acts did,
public safety and tranquillity in the State would be
affected.
11. But in India under Article 19(2) this wide concept of
“public order” is split up under different heads. It
enables the imposition of reasonable restrictions on the
exercise of the right to freedom of speech and
expression in the interests of the security of the State,
friendly relations with foreign States, public order,
decency or morality, or in relation to contempt of court,
defamation or incitement to an offence. All the grounds
mentioned therein can be brought under the general
head “public order” in its most comprehensive sense.
But the juxtaposition of the different grounds indicates
CA Nos. 6124-6131 of 2023 & Connected Matters Page 239 of 269
that, though sometimes they tend to overlap, they must
be ordinarily intended to exclude each other. “Public
order” is therefore something which is demarcated from
the others. In that limited sense, particularly in view
of the history of the amendment, it can be
postulated that “public order” is synonymous
with public peace, safety and tranquillity.
12. The next question is what do the words “interest of
public order” mean? The learned Advocate-General
contends that the phrase “in the interest of public
order” is of a wider connotation than the words “for the
maintenance of public order” and, therefore, any
breach of law which may have the tendency, however
remote, to disturb the public order would be covered by
the said phrase. Support is sought to be drawn for this
wide proposition from the judgment of this Court
in Ramji Lal Modi v. State of U.P. [(1957) SCR 860] It is
not necessary to state the facts of that case, as reliance
is placed only on the observations of Das, C.J., at p.
865, which read:
“It will be noticed that the language
employed in the amended clause is ‘in the
interests of’ and not ‘for the maintenance
of’. As one of us pointed out in Debi
Saron v. State of Bihar [AIR (1954) Pat
254] the expression ‘in the interests of’
makes the ambit of the protection very
wide. A law may not have been designed
to directly maintain public order and yet
may have been enacted in the interests of
public order.”
The learned Chief Justice again in Virendra v. State of
Punjab [(1958) SCR 308] observed, at p. 317, much to
the same effect:
“As has been explained by this Court
in Ramji Lal Modi v. State of U.P. [(1957)
SCR 860] the words ‘in the interests of’
are words of great amplitude and are
much wider than the words ‘for the
maintenance of’. The expression ‘in the
interests of’ makes the ambit of the
protection very wide, for a law may not
have been designed to directly maintain
the public order or to directly protect the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 240 of 269
general public against any particular evil
and yet it may have been enacted “in the
interests of” the public order or the
general public as the case may be.”
We do not understand the observations of the Chief
Justice to mean that any remote or fanciful connection
between the impugned Act and the public order would
be sufficient to sustain its validity. The learned Chief
Justice was only making a distinction between an Act
which expressly and directly purported to maintain
public order and one which did not expressly state the
said purpose but left it to be implied therefrom; and
between an Act that directly maintained public order
and that indirectly brought about the same result. The
distinction does not ignore the necessity for intimate
connection between the Act and the public order sought
to be maintained by the Act.
13. Apart from the said phrase, another limitation in the
clause, namely, that the restrictions shall be
reasonable, brings about the same result. The word
“reasonable” has been defined by this Court in more
than one decision. It has been held that in order to be
reasonable, “restrictions must have reasonable relation
to the object which the legislation seeks to achieve and
must not go in excess of that object”. The restriction
made “in the interests of public order” must also have
reasonable relation to the object to be achieved i.e. the
public order. If the restriction has no proximate
relationship to the achievement of public order, it
cannot be said that the restriction is a reasonable
restriction within the meaning of the said clause. A Full
Bench decision of the Federal Court in Rex v. Basudeva
[AIR (1950) FC 67] contains some observations which
give considerable assistance to construe the words. In
that case, the appellant was detained in pursuance of
the order made by the Government of U.P. under the
U.P. Prevention of Black-Marketing (Temporary Powers)
Act, 1947. The question was whether the preventive
detention provided for in Section 3(1)(i) of the said Act
was preventive detention for reasons connected with
the maintenance of public order. The argument in that
case ran on the same lines as in the present case. The
learned Advocate-General there urged that habitual
black-marketing in essential commodities was bound
CA Nos. 6124-6131 of 2023 & Connected Matters Page 241 of 269
sooner or later to cause a dislocation of the machinery
of controlled distribution which, in turn, might lead to
breaches of the peace and that, therefore, detention
with a view to prevent such black-marketing was
covered by the entry. Answering that argument,
Patanjali Sastri, J. as he then was, pointed out, at p.
69:
“Activities such as these are so remote in
the chain of relation to the maintenance of
public order that preventive detention on
account of them cannot, in our opinion,
fall within the purview of Entry I of List II.
… The connection contemplated must, in
our view, be real and proximate, not far-
fetched or problematical.”
The decision, in our view, lays down the correct test.
The limitation imposed in the interests of public order
to be a reasonable restriction, should be one which has
a proximate connection or nexus with public order, but
not one far-fetched, hypothetical or problematical or too
remote in the chain of its relation with the public order.
(Emphasis Supplied)
h. Public Order in the Age of Internet, Computer, and
Cyber Laws
356. This Court has also addressed the meaning and limits of
public order in the context of internet-based communication
and cyber regulation in Shreya Singhal v. Union of India,
reported in (2015) 5 SCC 1 , which examined the
constitutionality of Section 66A of the Information
Technology Act, 2000. While analyzing whether restrictions
on online speech could be justified under Article 19(2), the
Court reiterated that “public order” remains rooted in its
traditional meaning, namely the state of tranquillity which
CA Nos. 6124-6131 of 2023 & Connected Matters Page 242 of 269
prevails amongst members of a political society as a result of
internal regulations enforced by the government. Referring
back to Romesh Thappar (supra) , Supt., Central Prison
(supra) , and Arun Ghosh (supra) , the Court emphasized that
this expression has a specific constitutional history and
cannot be expanded to justify restrictions on speech lacking
any proximate connection to disturbance of community life.
“Public order
33. In Article 19(2)(as it originally stood) this sub-head
was conspicuously absent. Because of its absence,
challenges made to an order made under Section 7 of
the Punjab Maintenance of Public Order Act and to an
order made under Section 9(1)(a) of the Madras
Maintenance of Public Order Act were allowed in two
early judgments by this Court. Thus, in Romesh
Thappar v. State of Madras [Romesh Thappar v. State
of Madras, 1950 SCR 594 : 1950 SCC 436 : AIR 1950
SC 124 : (1950) 51 Cri LJ 1514] , this Court held that
an order made under Section 9(1)(a) of the Madras
Maintenance of Public Order Act (23 of 1949) was
unconstitutional and void in that it could not be justified
as a measure connected with security of the State.
While dealing with the expression “public order”, this
Court held that “public order” is an expression which
signifies a state of tranquility which prevails amongst
the members of a political society as a result of the
internal regulations enforced by the Government which
they have established.
xxx xxx xxx
36. In Supt., Central Prison v. Ram Manohar
Lohia [Supt., Central Prison v. Ram Manohar Lohia,
(1960) 2 SCR 821 : AIR 1960 SC 633 : 1960 Cri LJ
1002] , this Court held that public order is synonymous
with public safety and tranquility; it is the absence of
disorder involving breaches of local significance in
contradistinction to national upheavals, such as
CA Nos. 6124-6131 of 2023 & Connected Matters Page 243 of 269
revolution, civil strife, war, affecting the security of the
State. This definition was further refined in Ram
Manohar Lohia v. State of Bihar [Ram Manohar
Lohia v. State of Bihar, (1966) 1 SCR 709 : AIR 1966
SC 740 : 1966 Cri LJ 608] , where this Court held : (SCR
p. 746 D-E : AIR pp. 758-59, para 52)
“It will thus appear that just as ‘public
order’ in the rulings of this Court (earlier
cited) was said to comprehend disorders
of less gravity than those affecting
‘security of State’, ‘law and order’ also
comprehends disorders of less gravity
than those affecting ‘public order’. One
has to imagine three concentric circles.
Law and order represents the largest
circle within which is the next circle
representing public order and the
smallest circle represents security of
State. It is then easy to see that an act
may affect law and order but not public
order just as an act may affect public
order but not security of the State.”
37. In Arun Ghosh v. State of W.B. [(1970) 1 SCC 98 :
1970 SCC (Cri) 67 : (1970) 3 SCR 288] , Ram Manohar
Lohia case [Ram Manohar Lohia v. State of Bihar,
(1966) 1 SCR 709 : AIR 1966 SC 740 : 1966 Cri LJ 608]
was referred to with approval in the following terms :
(SCC pp. 99-100, para 3 : SCR pp. 290-91)
“… In Ram Manohar Lohia case [Ram
Manohar Lohia v. State of Bihar, (1966) 1
SCR 709 : AIR 1966 SC 740 : 1966 Cri LJ
608] this Court pointed out the difference
between maintenance of law and order
and its disturbance and the maintenance
of public order and its disturbance. Public
order was said to embrace more of the
community than law and order. Public
order is the even tempo of the life of the
community taking the country as a whole
or even a specified locality. Disturbance
of public order is to be distinguished from
acts directed against individuals which
do not disturb the society to the extent of
causing a general disturbance of public
tranquillity. It is the degree of disturbance
CA Nos. 6124-6131 of 2023 & Connected Matters Page 244 of 269
and its effect upon the life of the
community in a locality which determines
whether the disturbance amounts only to
a breach of law and order. Take for
instance, a man stabs another. People
may be shocked and even disturbed, but
the life of the community keeps moving at
an even tempo, however much one may
dislike the act. Take another case of a
town where there is communal tension. A
man stabs a member of the other
community. This is an act of a very
different sort. Its implications are deeper
and it affects the even tempo of life and
public order is jeopardised because the
repercussions of the act embrace large
sections of the community and incite them
to make further breaches of the law and
order and to subvert the public order. An
act by itself is not determinant of its own
gravity. In its quality it may not differ
from another but in its potentiality it may
be very different. Take the case of assault
on girls. A guest at a hotel may kiss or
make advances to half a dozen chamber
maids. He may annoy them and also the
management but he does not cause
disturbance of public order. He may even
have a fracas with the friends of one of
the girls but even then it would be a case
of breach of law and order only. Take
another case of a man who molests
women in lonely places. As a result of his
activities girls going to colleges and
schools are in constant danger and fear.
Women going for their ordinary business
are afraid of being waylaid and
assaulted. The activity of this man in its
essential quality is not different from the
act of the other man but in its potentiality
and in its effect upon the public
tranquillity there is a vast difference. The
act of the man who molests the girls in
lonely places causes a disturbance in the
even tempo of living which is the first
CA Nos. 6124-6131 of 2023 & Connected Matters Page 245 of 269
requirement of public order. He disturbs
the society and the community. His act
makes all the women apprehensive of
their honour and he can be said to be
causing disturbance of public order and
not merely committing individual actions
which may be taken note of by the
criminal prosecution agencies. It means
therefore that the question whether a
man has only committed a breach of law
and order or has acted in a manner likely
to cause a disturbance of the public order
is a question of degree and the extent of
the reach of the act upon the society. The
French distinguish law and order and
public order by designating the latter as
order publique. The latter expression has
been recognised as meaning something
more than ordinary maintenance of law
and order. Justice Ramaswami
in Pushkar Mukherjee v. State of
W.B. [(1969) 1 SCC 10] drew a line of
demarcation between the serious and
aggravated forms of breaches of public
order which affect the community or
endanger the public interest at large from
minor breaches of peace which do not
affect the public at large. He drew an
analogy between public and private
crimes. The analogy is useful but not to
be pushed too far. A large number of acts
directed against persons or individuals
may total up into a breach of public order.
In Ram Manohar Lohia case [Ram
Manohar Lohia v. State of Bihar, (1966) 1
SCR 709 : AIR 1966 SC 740 : 1966 Cri LJ
608] examples were given by Sarkar, and
Hidayatullah, JJ. They show how similar
acts in different contexts affect differently
law and order on the one hand and public
order on the other. It is always a question
of degree of the harm and its effect upon
the community. The question to ask is :
Does it lead to disturbance of the current
of life of the community so as to amount
CA Nos. 6124-6131 of 2023 & Connected Matters Page 246 of 269
to a disturbance of the public order or
does it affect merely an individual leaving
the tranquillity of the society
undisturbed? This question has to be
faced in every case on facts. There is no
formula by which one case can be
distinguished from another.”
38. This decision lays down the test that has to be
formulated in all these cases. We have to ask ourselves
the question : does a particular act lead to disturbance
of the current life of the community or does it merely
affect an individual leaving the tranquility of society
undisturbed? Going by this test, it is clear that Section
66-A is intended to punish any person who uses the
internet to disseminate any information that falls
within the sub-clauses of Section 66-A. It will be
immediately noticed that the recipient of the written
word that is sent by the person who is accused of the
offence is not of any importance so far as this section
is concerned. (Save and except where under sub-clause
(c) the addressee or recipient is deceived or misled
about the origin of a particular message.) It is clear,
therefore, that the information that is disseminated
may be to one individual or several individuals. The
section makes no distinction between mass
dissemination and dissemination to one person.
Further, the section does not require that such message
should have a clear tendency to disrupt public order.
Such message need not have any potential which could
disturb the community at large. The nexus between the
message and action that may be taken based on the
message is conspicuously absent—there is no
ingredient in this offence of inciting anybody to do
anything which a reasonable man would then say
would have the tendency of being an immediate threat
to public safety or tranquillity. On all these counts, it is
clear that the section has no proximate relationship to
public order whatsoever. The example of a guest at a
hotel “annoying” girls is telling—this Court has held
that mere “annoyance” need not cause disturbance of
public order. Under Section 66-A, the offence is
complete by sending a message for the purpose of
causing annoyance, either “persistently” or otherwise
without in any manner impacting public order.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 247 of 269
39. It will be remembered that Holmes, J.
in Schenck v. United States [63 L Ed 470 : 249 US 47
(1919)] , enunciated the clear and present danger test
as follows : (L Ed pp. 473-74)
“… The most stringent protection of free
speech would not protect a man in falsely
shouting fire in a theatre and causing a
panic. It does not even protect a man from
an injunction against uttering words that
may have all the effect of
force. Gompers v. Buck's Stove & Range
Co. [221 US 418 : 31 S Ct 492 : 55 L Ed
797 : 34 LRA (NS) 874 (1911)] , US p. 439.
The question in every case is whether the
words used are used in such
circumstances and are of such a nature
as to create a clear and present danger
that they will bring about the substantive
evils that Congress has a right to prevent.
It is a question of proximity and degree.”
40. This was further refined in Abrams v. United
States [250 US 616 : 63 L Ed 1173 (1919)] , this time in
a Holmesian dissent, to be clear and imminent danger.
However, in most of the subsequent judgments of the
US Supreme Court, the test has been understood to
mean to be “clear and present danger”. The test of
“clear and present danger” has been used by the US
Supreme Court in many varying situations and has
been adjusted according to varying fact situations. It
appears to have been repeatedly applied,
see Terminiello v. Chicago [93 L Ed 1131 : 337 US 1
(1949)], L Ed at pp. 1134-35, Brandenburg v. Ohio [23
L Ed 2d 430 : 395 US 444 (1969)] , L Ed 2d at pp. 434-
35 & 436, Virginia v. Black [155 L Ed 2d 535 : 538 US
343 (2003)] , L Ed 2d at pp. 551, 552 and 553 [ In its
present form the clear and present danger test has
been reformulated to say that: “The constitutional
guarantees of free speech and free press do not permit
a State to forbid or proscribe advocacy of the use of
force or of law violation except where such advocacy is
directed to inciting or producing imminent lawless
action and is likely to incite or produce such action.”
Interestingly, the US Courts have gone on to make a
CA Nos. 6124-6131 of 2023 & Connected Matters Page 248 of 269
further refinement. The State may ban what is called a
“true threat”. “True threats’ encompass those
statements where the speaker means to communicate
a serious expression of an intent to commit an act of
unlawful violence to a particular individual or group of
individuals.” “The speaker need not actually intend to
carry out the threat. Rather, a prohibition on true
threats protects individuals from the fear of violence
and from the disruption that fear engenders, in
addition to protecting people from the possibility that
the threatened violence will occur. Intimidation in the
constitutionally proscribable sense of the word is a type
of true threat, where a speaker directs a threat to a
person or group of persons with the intent of placing the
victim in fear of bodily harm or
death.”[See Virginia v. Black, 155 L Ed 2d 535 : 538 US
343 (2003) and Watts v. United States, 22 L Ed 2d 664
at p. 667 : 394 US 705 (1969)]] .
41. We have echoes of it in our law as well—S.
Rangarajan v. P. Jagjivan Ram [(1989) 2 SCC 574] ,
SCC at para 45 : (SCC pp. 595-96)
“45. The problem of defining the area of
freedom of expression when it appears to
conflict with the various social interests
enumerated under Article 19(2) may
briefly be touched upon here. There does
indeed have to be a compromise between
the interest of freedom of expression and
special interests. But we cannot simply
balance the two interests as if they are of
equal weight. Our commitment of freedom
of expression demands that it cannot be
suppressed unless the situations created
by allowing the freedom are pressing and
the community interest is endangered.
The anticipated danger should not be
remote, conjectural or far-fetched. It
should have proximate and direct nexus
with the expression. The expression of
thought should be intrinsically dangerous
to the public interest. In other words, the
expression should be inseparably locked
up with the action contemplated like the
equivalent of a ‘spark in a power keg’.”
CA Nos. 6124-6131 of 2023 & Connected Matters Page 249 of 269
xxx xxx xxx
43. In Ramji Lal Modi v. State of U.P. [1957 SCR 860 :
AIR 1957 SC 620 : 1957 Cri LJ 1006] , SCR at p. 867,
this Court upheld Section 295-A of the Penal Code only
because it was read down to mean that aggravated
forms of insults to religion must have a tendency to
disrupt public order. Similarly, in Kedar Nath
Singh v. State of Bihar [1962 Supp (2) SCR 769 : AIR
1962 SC 955 : (1962) 2 Cri LJ 103] , Section 124-A of
the Penal Code, 1860 was upheld by construing it
narrowly and stating that the offence would only be
complete if the words complained of have a tendency of
creating public disorder by violence. It was added that
merely creating disaffection or creating feelings of
enmity in certain people was not good enough or else it
would violate the fundamental right of free speech
under Article 19(1)(a). Again, in Ramesh Yeshwant
Prabhoo v. Prabhakar Kashinath Kunte [(1996) 1 SCC
130] , Section 123(3-A) of the Representation of the
People Act was upheld only if the enmity or hatred that
was spoken about in the section would tend to create
immediate public disorder and not otherwise.
44. Viewed at, either by the standpoint of the clear and
present danger test or the tendency to create public
disorder, Section 66-A would not pass muster as it has
no element of any tendency to create public disorder
which ought to be an essential ingredient of the offence
which it creates.
(Emphasis Supplied)
357. Shreya Singhal (supra) establishes that even in the digital
age, online speech can be restricted on public-order grounds
in circumstances where it poses a clear and present danger
to public tranquillity, incites imminent violence or lawless
action, or constitutes a true threat producing fear or
disrupting public order.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 250 of 269
i. Ingredients of Public Order Culled Out
358. In light of the above, public order may be said to comprise
the following constituent elements:
a) A state of tranquility prevailing amongst members of a
political society as a result of internal regulations
enforced by the Government;
b) The absence of disorder
c) A positive condition of peaceful, ordered social existence
enabling normal civic life;
d) Public order denotes an orderly state of society and
community in which citizens may peacefully pursue
their normal activities of life;
e) Public order is reflected in the “even tempo” of life in a
locality. Therefore, conduct that maintains or secures
this even tempo falls within the realm of public order
regulation;
f) Public safety or interest may, depending upon context,
be legitimately invoked in its relation to the
maintenance of public order to support legislative action
preserving public order;
g) Public order occupies a constitutional position between
the widest circle of “law and order” and the narrowest
circle of “security of the State”, signifying a broader
CA Nos. 6124-6131 of 2023 & Connected Matters Page 251 of 269
societal impact rather than individual disturbances but
less in magnitude when compared to threats to security
of the State.
359. Correspondingly, disruption or disturbance of public order
public order arises in the following situations:
a) An act disturbs public order when it affects the current
or even tempo of the life of the community, rather than
merely injuring an individual;
b) When repercussions of an act extend to large sections of
the community, inciting further breaches of law and
order or provoking communal passions, public order is
subverted;
c) Activities that impair public health or constitute a
manifest nuisance fall squarely within the State’s
competence under public order;
d) Activities that cause detriment of health, tranquility and
comfort of others;
e) If something disturbs the current of the life of the
community, and does not merely affect an individual;
f) Conduct which induces fear or panic in the community
such that ordinary pursuits of life are abandoned
CA Nos. 6124-6131 of 2023 & Connected Matters Page 252 of 269
becomes a matter of public order even if the immediate
act is aimed at a particular individual;
g) Disturbances in the social or economic spheres that
shake the orderly functioning of society, including large-
scale financial defaults undermining public confidence,
may also constitute breach of public order.
360. We shall now discuss in light of the principles condensed
from the various judgments of this Court referred to above,
whether the widespread prevalence and rampant online
gaming involving betting and gambling poses a serious
threat to public order.
361. First and foremost, it cannot be denied that there is an
involvement of the public at large, throughout the length and
breadth of the country, indulging in staking money in online
gaming and fantasy gaming. Consequently, the whole online
money gaming sector has boomed, and the activity of betting
and gambling has been normalized to a large extent.
Statistics would go on to show that the accessibility of these
games is so penetrative that a large number of the players
come from rural backgrounds and often from lower income
groups. Therefore, it cannot be denied that the public, at
large, is involved in online money gaming. With the growth
CA Nos. 6124-6131 of 2023 & Connected Matters Page 253 of 269
of technology, the mischief that the Public Gambling Act
sought to curb i.e. prevent the rise of common gambling
houses, has gone completely in vain as every mobile phone
is now a virtual common gambling house as well as the
instrument of gaming.
362. Therefore, in terms of addiction, in terms of monetary losses
and in terms of resultant widespread suicides, online money
gaming has a definite impact on the public. When such is
the case, it has to be recognized that online money gaming
has been disturbing the tranquility of the public by making
betting and gambling more normalized and accessible.
Therefore, public tranquility is breached and consequently,
the States would have competence to invoke public order
and seek to curb the mischief and restore public tranquility.
363. The even tempo of the life of the community is facing
hindrance as there is widespread monetary losses as well as
addiction. Such losses and addiction are not limited to
individuals and have turned out to be common. There are
huge repercussions on large sections of the community who
have access to a mobile phone and instant payment
gateways. These Sections of the community often tend to
deviate from the ordinary pursuits of life and are drawn into
CA Nos. 6124-6131 of 2023 & Connected Matters Page 254 of 269
the world of false hope, based on the premise of instant
gratification in terms of monetary gain, which normalizes
their risk appetite. Therefore, the States are competent to
curb this mischief as it poses a grave threat to public
tranquility. The Gujarat High Court had expressed concerns
over the Youth falling prey to Internet Gambling, in the
judgment titled Amit M. Nair v. State of Gujarat reported
in AIR OnLine 2020 Guj 2072 wherein the Court observed
the following:
“Internet gambling presents essentially many of the
same concerns that the traditional gambling activities
have raised throughout the years: uneasiness about
the morality of the activity; the likelihood of addiction;
the possibility of fraud; and the conflict between the
state versus central regulations. The questions of
morality primarily surface in connection with the
Internet gambling's accessibility to children because
children have potentially unlimited access to the
computers and the Internet. It is possible that without
proper monitoring they may access to the gambling
Websites as readily as they could access the indecent
materials. The supporters of a ban of Internet gambling
maintain that outlawing the activity for all individuals
is the only way to ensure that a segment of the
population, children, will be adequately protected from
corruption.”
(Emphasis Supplied)
364. Moreover, the addiction and depression that stems from
indulging in online money gaming and the frequent suicides
CA Nos. 6124-6131 of 2023 & Connected Matters Page 255 of 269
that are reported would go on to indicate that this poses a
widespread public health issue as well. As seen from the
above decisions, any activity that is detrimental to public
health and impairs public health or constitutes a manifest
nuisance would fall squarely within the State’s competence
under public order.
365. Even though public health is a separate legislative head, yet
the State can justify its legislative competence under public
order itself since the mischief sought to be curbed poses a
threat to public mental health at large, which will ultimately
fall under the domain of ‘public order’. Similarly, though it
might look as if only an individual is affected, the cascading
effect nevertheless affects ultimately the entire community,
which poses a threat to very existence of order and the
concept of welfare state.
366. This Court has recently recognized the right to mental health
to be an integral part of right to life, in its judgment in
Sukdeb Saha v. State of Andhra Pradesh , reported in
2025 INSC 893 . When mental health has now been put at
such a high pedestal, it would be the bounden duty of all the
State to protect and enforce such rights and to ensure that
CA Nos. 6124-6131 of 2023 & Connected Matters Page 256 of 269
activities that are detrimental to public mental health are
curbed.
367. Recourse is made to RMDC-I (supra) again to establish how
betting and gambling can never find a place in a welfare state
and how such activity poses a threat to health, livelihood and
the vision of the Constitution makers:
“36. The avowed purpose of our Constitution is to
create a welfare State. The directive principles of State
policy set forth in Part IV of our Constitution enjoin upon
the State the duty to strive to promote the welfare of the
people by securing and protecting, as effectively as it
may, a social order in which justice, social, economic
and political, shall inform all the institutions of the
national life . It is the duty of the State to secure to
every citizen, men and women, the right to an
adequate means of livelihood and to see that the
health and strength of workers, men and women,
and the tender age of children are not abused, to
protect children and youths against exploitation
and against moral and material abandonment. It
is to be the endeavour of the State to secure a
living wage, conditions of work ensuring a decent
standard of life and full enjoyment of leisure and
social and cultural opportunities, to protect the
weaker sections of the people from social
injustice and all forms of exploitation, to raise
the standard of living of its people and the
improvement of public health. The question
canvassed before us is whether the Constitution
makers who set up such an ideal of a welfare State
could possibly have intended to elevate betting and
gambling on the level of country's trade or business or
commerce and to guarantee to its citizens the right to
CA Nos. 6124-6131 of 2023 & Connected Matters Page 257 of 269
carry on the same. There can be only one answer to the
question.”
(Emphasis Supplied)
368. Ms. Anjali Nagpal, a neuropsychiatrist who has studied the
issue closely, said 'gambling disorder' is silently becoming an
epidemic in India and is being normalized.
“When favorite celebrities openly promote them across social
media, youngsters start to feel less like [it's] a risky activity
and more like a trendy thing to do. It creates a false sense of
security and on seeing their heroes endorsing it, their thought
is: ‘How bad can it be?” Nagpal said in an interview reported
on DW, a popular international news broadcaster.
369. In her reckoning, the cycle starts small after a few wins
that trigger a dopamine rush, making players feel
accomplished.
“But as they chase bigger rewards, they get pulled in deeper,
often without realizing it. Even after losing, the memory of
those early victories keeps them hooked, fuelling an endless
cycle, ” said Ms. Nagpal.
“ The consequences include heavy financial losses, debt,
family pressure, and constant disappointment which take a
CA Nos. 6124-6131 of 2023 & Connected Matters Page 258 of 269
severe toll on mental health. It should be dealt strictly and
promptly with stronger laws ,” added Ms. Nagpal.
370. We shall now demonstrate how the two States have sought
to prevent this moral and material abandonment, mental
degradation and prevent the exploitation of youth and their
hard-earned money.
371. The State of Tamil Nadu categorically laid down that
wagering or betting on any game using cyberspace and a
computer system would constitute gaming under the act and
whosoever engages in such gaming or facilitates such
gaming would be liable for punishment in the form of
imprisonment and fine under Section 3A of the 1930 Gaming
Act.
372. Prior to the amendment, Section 11 of the 1930 Gaming Act
had protected games of skill by an express carve out clause
that exempted the application of the Act to games of mere
skill.
373. In lieu of the Amendment, this protection clause was
removed. The State of Tamil Nadu took this decision to curb
the rampant rise of online betting and gambling, which the
1930 Act could not have foreseen. The State exercised their
CA Nos. 6124-6131 of 2023 & Connected Matters Page 259 of 269
legislative power and applied their wisdom to counter this
growing menace. By removing the protection clause and
amending the definition of gaming to extend to cyberspace
as well, the State has made it an offence to wager or bet on
any game, which includes a game of skill.
374. The Karnataka Legislative Assembly wanted to curb the
menace of online betting and gambling and therefore
amended the provisions of the 1963 Police Act. The
consequences of the amendments are as follows:
a) The platforms of the online gaming companies, which
are virtual software applications, were brought under
the ambit of common gaming houses by amending the
definition of the phrase “place”.
b) Computers, mobile phones, internet and cyberspace
have now been brought under the ambit of the definition
“instruments of gaming”.
c) The phrase “gaming” under Section 2(7), means all
forms of wagering or betting using money, tokens valued
in terms of money and every other form of virtual
currency and electronic transfer of funds. The
explanation to the provision makes it very clear that
collection, soliciting, receipt or distribution, any act or
CA Nos. 6124-6131 of 2023 & Connected Matters Page 260 of 269
risking money, or otherwise on the unknown result of
an event including on a game of skill would constitute
wagering or betting and would therefore squarely fall
within the definition of gaming.
d) Section 2(12A) introduces the definition for online
gaming. The provision makes it very clear that all forms
of gaming, as defined under Section 2(7), when played
with instruments of gaming like computers,
applications and mobile phones or other virtual
platforms, would constitute online gaming.
e) Section 78(1)(a) of the 1963 Police Act makes it an
offence for the owner and occupier of online gaming
platforms that involve betting or wagering, and which is
opened for the purpose of gaming. When such a
platform is used for the following two purposes (as given
in sub-clause (vi) and (vii)), then the offender is liable to
be imprisoned for a period of upto one year or fine or
both.
f) Therefore, from the above provision, it is abundantly
clear that when money is risked on an uncertain event,
even while playing a game of skill, it would constitute an
offence under the 1963 Police Act.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 261 of 269
g) Section 176 of the 1963 Police Act saved the application
of Sections 79 and 80 respectively to games of skill.
Previously, the provision extended protection to
wagering or betting on games of skill as well. Now, only
games of skill are protected under the 1963 Police Act
and wagering or betting on games of skill is not covered
by the protection.
h) Any offence committed under Section 78 would now be
cognizable and non-bailable in lieu of Section 128A of
the 1963 Police Act.
375. Therefore, an assessment of the two Acts along with their
Statement of Objects and Reasons, would go on to establish
that there is a proximate relation between the said Acts and
the mischief they seek to curb and therefore, public order
can be invoked to satisfy the competence of the States to
enact the impugned legislations. The States have merely
taken an effort to enforce the vision of the Constituent
Assembly by seeking to protect the future and livelihood of
the Population.
H. CONCLUSION
376. In lieu of the aforesaid discussion, we summarize our
findings as follows:
CA Nos. 6124-6131 of 2023 & Connected Matters Page 262 of 269
a) The High Court of Madras and the High Court of
Karnataka respectively committed an egregious error in
giving a very narrow interpretation to Entry 34 of the
List II. Both the High Courts failed to take into account
the power intended to be bestowed upon the State
Legislature under the said Entry by the framers of the
Constitution. This has rendered both the States
powerless to prohibit the activity of betting and
gambling.
b) A natural corollary of the observations made by this
Court in RMDC-II (supra) is that if games of substantial
skill are conducted in a manner that they start to pose
a severe threat and problems for the State or cause
harm to the public, then the State will not be powerless
to regulate such games of substantial skill as well. In
the present case, since betting on games of skill is
posing a serious threat to the State and the well-being
of the masses, such betting would not enjoy immunity
merely because it is taking place on a game of skill.
c) There was no occasion for this Court to consider the
scope of the term “betting” as it appears in the
expression “betting and gambling” in Entry 34 List II,
and also the nature of the conjunction “and” joining the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 263 of 269
two words, while rendering the decisions in RMDC-I
(supra) and RMDC-II (supra) respectively.
d) While it may be true that games of skill may not get
covered by the expression “gambling”, it is not correct to
say that even “betting” on games of skill would be out of
the competence of the State Legislature to legislate
upon.
e) In K.R. Lakshmanan (supra) , the scope of the
expression “betting and gambling” as appearing in Entry
34 was not the subject matter of determination, rather,
the issue pertained to whether horse racing would be
entitled to the protection of the exception that the State
Legislature had itself carved out for games of “mere skill”
under Section 49 of the 1963 Police Act and Section 11
of the 1930 Gaming Act respectively.
f) The decision in K.R. Lakshmanan (supra) has no
application to cases like the one at hand where the State
Legislature, in its wisdom, has deemed it appropriate to
regulate games where monetary stakes are involved,
without affording any special protection to games of
mere skill.
g) A reading of the decision in K.R. Lakshmanan (supra)
also indicates that the Court therein considered the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 264 of 269
manner in which the Club operated and conducted the
horse-races, as well as the process by which
wagering/betting happened. The observations of the
Court clearly indicate that the entire process of
conducting races and betting on them was highly
regulated and organized, which is very different from the
uncertainty and veil of invisibility associated with online
gaming activities, whether of skill or of chance.
h) The finding in the impugned judgments that the
expression “betting and gambling” ought to be
interpreted as “betting on gambling” is a clear
Constitutional aberration, tinkering with the
Constitution or actually rewriting the Constitutional
text which Courts are not legally entitled to do.
i) The expression “betting and gambling” cannot be split
to mean that the staking angle alone would amount to
betting whereas the risk angle or the chance element
would amount to gamble. Both betting and gambling
involve the aspect of staking money on an uncertainty.
Merely because the risk element is commonly perceived
as “taking a chance”, it cannot mean that an expression
would cover only games of chances.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 265 of 269
j) The protection afforded to games of skill under Entry 34
cannot be construed as protection to betting on games
of skill, which essentially becomes a gambling
enterprise.
k) When the element of betting and gambling enters the
picture, the nature of the game ceases to be of relevance.
The common aspect of addiction and the desire to gain
more and more looms large wherever staking money on
an uncertain event is involved. When such is the case,
there is no question of manifest arbitrariness since the
States have always been permitted to regulate or
prohibit betting and gambling.
l) The occasion for testing the impugned legislations on
proportionality does not arise as activities encompassed
under “betting and gambling” are in the nature of res
extra commercium , and the plain reading of the two
RMDC ( supra ) decisions also suggests that no one can
claim a fundamental right in operating an activity which
is extra commercium.
m) Games of skill would be protected by the constitutional
guarantee laid down under Article 19, but betting or
wagering on any game, be it a game of skill, would not
be entitled to receive any such protection, unless the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 266 of 269
Legislature creates an exception in favour of such
betting on games of skill.
n) The competence of the State to regulate certain activity
also enables it to prohibit the same activity, subject to
Part III of the Constitution, if applicable. The 2021
Amendment has not provided a sweeping definition or a
“Midas touch”. It has merely brought every form of
betting and gambling under its sweep, and for that the
States are empowered under Entry 34 List II. In absence
of availability of the protection of Article 19, total
prohibition would not be hit by the test of
proportionality.
o) The phrase “gaming” cannot be said to be nomen juris .
The phrase “gaming” is a statutory definition that can
be altered according to the will of the Legislature. In no
way can it be dependent on the element of chance alone.
The definition of “gaming” is fluid and fluctuating across
the states and different legislations.
p) In terms of addiction, in terms of monetary losses and
in terms of resultant widespread suicides respectively,
online money gaming has a definite impact on the
public. When such is the case, it has to be recognized
that online money gaming has been disturbing the
CA Nos. 6124-6131 of 2023 & Connected Matters Page 267 of 269
tranquility of the public by making betting and gambling
more normalized and accessible. Therefore, public
tranquility is breached and consequently, the States
would have competence to invoke public order and seek
to curb the mischief and restore public tranquility.
q) The addiction and depression that stem from indulging
in online money gaming and the frequent suicides that
are reported would go on to indicate that this poses a
widespread public health issue as well.
r) The Tamil Nadu State Legislature relied on the report of
the Justice Chandru committee wherein empirical
findings related to the widespread harms of betting
linked with online gaming have been discussed in detail.
As such, the legislations are supported and backed by
empirical data contrary to the assertion of the
respondents.
377. In view of the aforesaid, the appeals preferred by the State of
Tamil Nadu and the appeals preferred by the State of
Karnataka stand allowed. The impugned judgments passed
by the High Court of Madras and the High Court of
Karnataka, respectively, are set aside. As a corollary, Part II
of the 2021 TN Amendment Act, Sections 2(i), 2(l)(iv) and
CA Nos. 6124-6131 of 2023 & Connected Matters Page 268 of 269
Schedule to the TN Online Gambling Act 2022/23, Sections
2, 3, 6, 8 & 9 of the 2021 Karnataka Amendment Act,
respectively, are declared intra-vires the Constitution.
378. The connected appeal i.e., CA No. 6144 of 2023, also stands
disposed of in the aforesaid terms.
379. No order as to costs.
…………………………….. J.
(J.B. PARDIWALA)
…………………………….. J.
(R. MAHADEVAN)
NEW DELHI
th
27 MAY 2026.
CA Nos. 6124-6131 of 2023 & Connected Matters Page 269 of 269