No interim relief to online gaming cos; Madras HC to hear final arguments on July 13

The Madras High Court on 3 July, refused to grant interim relief to the online gaming firms challenging the Tamil Nadu government’s law which banned online gambling and gaming.

The southern state passed the Tamil Nadu Prohibition of Online Gambling and Regulation of Online Games Act, 2022, banning online gaming in the state, which had also got Tamil Nadu Governor R.N. Ravi’s assent, on 7 April.

The petitions (a batch of cases) filed by the All India Gaming Federation (AIGF) and other online games platforms like Gameskraft, Head Digital Works, Junglee Games and Play Games 24x7 were seeking a stay on the Tamil Nadu’s Act that that came up for hearing before the bench of Chief Justice SV Gangapurwala and Justice PD Audikesavalu of the Madras High Court.

Senior Counsel Mukul Rohatgi and Senior Counsel Abhishek Manu Singhvi, appearing for the petitioners, on Monday, urged the court to grant an interim stay. Rohatgi contested that the Supreme Court had already held that rummy is a game of skill. He also stated that the High Court had already struck down the ban on playing online rummy.

However, according to Senior Counsel Kapil Sibal, representing the Tamil Nadu government, the court had not accepted the plea of the petitioners during the previous hearing even after arguments lasted for nearly two hours. He said that the plea regarding the interim relief was already heard by a bench of then Acting Chief Justice T Raja and Justice Bharatha Chakravarthy, who refused to grant any interim stay. Sibal also contested for fixing a date for final arguments.

Subsequently, the court adjourned the cases to July 13 for final hearing.

This is the second time the Madras high court has spoken about this matter. Earlier, in its counter-affidavit, the state submitted that Article 245 and 246 of the Constitution conferred necessary powers on it to legislate such laws. 

It also said that the “law was enacted with respect to three subjects – public order, public health and betting and gambling – which are found in Entries 1, 6 and 34 of List II (State list) of the Constitution” and that it also “qualifies as a law made with respect to the subject of criminal law”.

Even rummy, generally considered as a game of skill, when played online, could be only classified as a game of chance and not skill, it added.

In June, Union Minister Rajeev Chandrasekhar announced that three types of games will be banned in India, including games that involve betting, games that can be harmful to the user and games that involve a factor of addiction. This can hurt Google's Play Store and Apple's App Store - two of the dominant application stores in the county.

"For the first time we have prepared a framework regarding online gaming, in that we will not allow three types of games in the country. Games that involve betting or a factor of addiction can be harmful to the user and will be banned in the country," the minister told ANI, adding that the government has already prepared a blueprint of the new rules.