New Delhi | 30 Dec, 2020 (2 months ago)

General Advice

I want to setup a game with prize money it's legal or illegal.

Like if you want to play game you have pay entry fee and if you win prize money will be yours. And this is public place game just like street game. If it's legal then what I have to do. What documents it requires etc etc
Answers
12 Jan, 2021 | 15:41

The statutory position on activities relating to betting and gambling varies from State to State as Betting and Gambling is a State subject falling under Entry 34 of List- II of the Seventh Schedule of the Constitution.

However, as gambling as an activity is largely prohibited in most States, I shall proceed on the presumption that you might be setting up your gaming business in a State where gambling is prohibited.

If that be the case, the legality of the activity proposed to be carried out by you, would depend on the nature of the game. Through several judgments, Courts have categorized games into Games of Skill and Games of Chance. If the activity involved requires a substantial degree of skill and persons possessing and regularly exercising such skills are more likely to be more successful in the game, then it could be said that the game involved is a Game of Skill and hence, does not amount to gambling (See R.M.D. Chamarbauwalla vs. Union of India AIR (1957) SC 628). To give you a few examples, the Supreme Court has in the past held betting on horse races (Dr. K.R. Lakshmanan vs. State of Tamil Nadu 1996 2 SCC 226) and playing the game of rummy (State of Andhra Pradesh vs. K. Sathyanarayanan AIR (1968) SC 825) to be games of skill. However, it maybe noted that in recent times, the Gujarat High Court has held the game of online poker is a game of chance (Dominanace Games Pvt. Ltd. vs. State of Gujarat SCA No. 6903 of 2017).

Hence to determine the legality of the game being set up, a detailed examination of the nature and specifics of the game would have to be carried out.

Insofar as the query regarding the compliances and documentation is concerned, the same would depend on several factors like the State, Municipality and locality in which the game is proposed to be conducted, the nature of the location, the scale of activities etc.


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