Online betting portal setup project is it legal

691 votes

See the laws on online betting in India is still to get into a concrete shape. As of now the gambling laws which govern in the whole lot of India is The Public Gambling Act, 1867. As you can see the year is 1867, therefore the legislators of that time could not estimated the digitized future, and therefore do not mention any 'online' terminology either. At the same time now we have IT Act 2000, but again the Act is silent on the online gambling activities. But whereas the common of the Legal Jurisprudence is that while operating the online gambling activities, if there occurred any unfair means or criminal activities, then the law will take its own course of action.
Apart, the gambling laws varies from state to state. Like in West Bengal, under the West Bengal Gambling & Prize Competition Act, 1957 card games such as rummy, bridge and poker are excluded from the definition of gambling. Such games can be organized for the public as long as a permit is obtained from the District Magistrate or Sub-divisional magistrate or Commissioner of Police Calcutta. But at the same time do not constitute any provisions on online gambling.
So need to sit together as want to analyze your business well for proper recommendation, Please.

Advocate Pradipta Nath LawRato

711 votes

From your query, it seems your concerns are for setting up a game of chance which is illegal in India, while a game of skill is not and is protected under article 19(1)(g) of the Constitution of India. For instance betting on cricket is considered as a “game of chance” in India (not because of legislative definition but due to a Supreme Court precedent) and is hence illegal. Betting on a game of chance contrasts with a game of skill such as horse racing which is granted more leeway. In 2016 a committee specially constituted to suggest reforms in the Board of Control for Cricket in India suggested legalizing and regulating betting in cricket. However this is subject to confirmation by the Supreme Court of India.

While there is no specific legislation with respect to online/live betting gaming, there are other laws such as cyber laws, tax laws, anti-money laundering laws, exchange control regulations, etc. that affect online gambling and betting industry. Gambling laws prescribe a fine, imprisonment or both for contravention. Fine range between INR 200 and INR 5000 and a term of imprisonment between one and three years. In addition to this the Information Technology Act 2000 regulates cyber activities including online gambling and betting in India and prohibits publication or transmission of information that can corrupt people and the punishment for such activities is much more serious than for offline gambling operations – the fine is INR 100,000 or imprisonment up to 5 years. Beside RBI guidelines in the Foreign Exchange Management Act makes it illegal for unauthorized money to travel across borders for gambling.

So its wise to set-up and operate your online betting company offshore probably in UK which will be governed by UK gambling laws. The payment cannot be done from any Debit/Credit cards in India as it is illegal here, making such transactions a crime of money laundering, all transaction is to be done using online EWallets- NETELLER OR SKRILL.

If you need any assistance we can guide you.

Disclaimer: This article does not constitute legal advice and does not constitute an Attorney-Client relationship between me and reader.

Advocate Robert D Rozario LawRato