TMI Blog2022 (2) TMI 1368X X X X Extracts X X X X X X X X Extracts X X X X ..... ws untouchability (Article 17), human trafficking and begar (Article 23), child employment (Article 24). Part IV enacts Directive Principles of State Policy which Dr. Ambedkar called as the 'instrument of instructions'. It specifies a list of do's don'ts that address the making of government policies. Article 47 directs prohibition of liquors injurious drugs - there is no such prohibition expressly or impliedly suggested in respect of gambling although power to legislate concerning the same avails to the State vide Entry 34, List II, Schedule VII of the Constitution. As to legislative competence and wider interpretation of legislative entries - HELD THAT:- It has long been settled that the legislative power emanates inter alia from Articles 245 246 (now additionally Article 246A) of the Constitution and that the Legislative Entries are only the fields of law making. These Entries are mere legislative heads of enabling character designed to define and delimit the respective areas of legislative competence of the Union and the States. The legislative Entries in whichever List they occur should be interpreted with the 'widest amplitude' - When a word ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . A waitress floated around with food drinks and play lasted until breakfast. Judge Jack B. Weinstein held that poker is more a game of skill than a game of chance and therefore, game operators cannot be prosecuted under vague federal law that prohibits running an illegal gambling business. Although this decision was reversed in appeal, the finding that poker is a game of skill, is left undisturbed. As to between Actual Games and Virtual Games, and if all online Games are online games are Games of Chance - HELD THAT:- 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 MJ. SIVANI VERSUS STATE OF KARNATAKA [ 1995 (4) TMI 284 - SUPREME COURT] . We are not 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 certa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from AK. GOPALAN VERSUS STATE OF MADRAS [ 1950 (5) TMI 24 - SUPREME COURT] and JUSTICE K.S. PUTTASWAMY (RETD.) AND ANOTHER VERSUS UNION OF INDIA AND OTHERS [ 2018 (9) TMI 1733 - SUPREME COURT] has broadened the contours of right to life personal liberty, exponentially. Several rights guaranteed in Part III of the Constitution are no longer treated as water tight compartments, since they have correlative content and each illuminates the penumbra of other by interplay. Political, social economic changes have entailed the recognition of new rights such as right to privacy. Virtual Games and elements of Expression as US Courts view them - HELD THAT:- The US Supreme Court in BROWN vs. ENTERTAINMENT MERCHANTS ASSOCIATION, was considering the challenge to a California law that restricted the sale or rental of violent video-games to minors. Justice Antonin Scalia reasoned that such a law does not comport with the First Amendment inasmuch as these games too, qualify for protection under the shadow of Amendment on par with books, plays movies, although they communicate ideas through familiar literal devices and features distinctive to the medium. The Court inter alia observed th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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. As to whether CHAMARBAUGWALA JURISPRUDENCE has lost relevance due to Advancement of Science and Technology - HELD THAT:- 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 every ebb and flow of economic events. A constitution is not a storehouse of fossilized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ' in accordance with provisions of the Constitution. 3. A Writ of Mandamus is issued restraining the respondents from interfering with the online gaming business and allied activities of the petitioners. - Writ Petition Nos. 18703, 18729, 18732, 18733, 18738, 18803, 18942, 19241, 19271, 19322, 19450 and 22371/2021 (GM-POLICE) - - - Dated:- 14-2-2022 - RITU RAJ AWASTHI, C.J. AND DIXIT KRISHNA SHRIPAD, J. For the Appellant : C. Aryama Sundaram, D.L.N. Rao, V. Srinivasa Raghavan, Mukul Rohtagi, Sajjan Poovvayya, Abhishek Manu Singhvi, Lakshmy Iyengar, Gopal Jain, Senior Advocates, Pradeep Nayak, Anupama Hebbar, Sankeerth Vittal, Siddharth Aiyanna, Dheeraj Murthy, Rohini Musa, Vidushpat Singhania, Arjun P.K., Shambhavi Sinha, Akhil Anand, Pratibhanu Khadra, T.S. Suresh, Akash B. Shetty, Shrishail Shivabasappa Navalgund, A.S. Vishwajith, Advs., Vikram Unni Rajagopal, Gautam Shreedhar Bharadwaj, Siddartha H.M. for Sahan Mukherjee, Ravi Sehgal for Akash V.T. and Abhishek Malhotra for Ricab Chand, Advocates For the Respondent : Prabhulingh K. Navadagi, Advocate General and Rohan Veeranna Tigadi, Spl. Counsel JUDGMENT Dixit Krishna Shripad, J. 1. The tic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of doctrine of privacy vide K.S. PUTTASWAMY vs. UNION OF INIDA (2019) 1 SCC 1. (iii) Violation of fundamental right to freedom of speech expression guaranteed under Article 19(1)(a) since playing games sports of skill is a facet of speech expression and that criminalizing apart from amounting to unreasonable restriction, is incompetent under Article 19(2). (iv) Violation of fundamental right to profession/business guaranteed under Article 19(1)(g) read with Article 301 i.e., incompetent unreasonable restriction vide CHINTAMAN RAO vs. STATE OF MADHYA PRADESH (1950) SCR 759, MOHD. FAROOQ vs. STATE OF MADHYA PRADESH (1969) 1 SCC 853, game of skill not being a res extra commercium (CHAMARBAUGWALA-II, supra) and embargo being de hors Article 19(6). (v) Manifest arbitrariness SHAYARA BANO vs. UNION OF INDIA (2017) 9 SCC 1 since the Amendment Act fails to recognize the blatant normative difference between a 'game of skill' and a 'game of chance', in gross derogation of Chamarbaugwala Jurisprudence of more than six decades. (vi) The impugned legislative measure is a result of excessive paternalism populism. The State is imposing its own notion of mor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovisions. (iv) The petitioners lack both the locus standi and the cause of action, there being no coercive action initiated against anyone of them or against anyone who made use of their online gaming platforms. Ordinarily, anticipatory relief of the kind cannot be granted by a constitutional Court. (v) Those of the petitioners who happen to be the companies incorporated under the erstwhile Companies Act, 1956 or the present Companies Act, 2013, being juristic persons cannot avail the fundamental rights guaranteed under Article 19(1) of the Constitution. (vi) In support of their submission, the respondents inter alia bank upon the decisions of Apex Court in JILUBHAI NANBHA KACHAR vs. STATE OF GUJARAT (1995) SUPP 1 SCC 596, GODFREY PHILLIPS INDIA LTD. vs. STATE OF UTTAR PRADESH (2005) 2 SCC 515, M.J. SIVANI vs. STATE OF KARNATAKA (1995) 6 SCC 289, HIGH COURT OF GUJARAT vs. GUJARAT KISHAN MAZDOOR PANCHAYAT (2003) 4 SCC 712, BHARAT HYDRO CORPORATION LTD. vs. STATE OF ASSAM (2004) 2 SCC 523, VARUN GUMBER vs. UNION TERRITROY OF CHANDIGARH , B.P. SHARMA vs. UNION OF INIDA (2003) 7 SCC 309, SYSTOPIC LABORATORIES vs. DR. PREM GUPTA (1994) Supp. 1 SCC 160, etc. V. Having heard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tent, enclosure, vehicle, vessel or place for purposes of gaming. (2) Clause 7 of Section 2: gaming does not include a lottery but includes all forms of wagering or betting in connection with any game of chance, except wagering or betting on a horse-race [run on any race course within or outside the State], when such wagering 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. Clause 7 of Section 2: 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 or betting takes pla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or temporary, or any area, whether enclosed or open. Clause 13 of Section 2: 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. TABLE-2 (AMENDMENT TO SUBSTANTIVE PROVISIONS NAMELY SECTIONS 78, 79, 80, 87, 114, 128A 176) PRE-AMENDMENT POST AMENDMENT (6) Section 78(1)(a)(vi): Opening, etc., of certain forms of gaming.--(1) Whoever,--(a) being the owner or occupier or having the use of any building, room, tent, enclosure, vehicle, vessel or place, opens, keeps or uses the same for the purpose of gaming-- (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; Section 78(1)(a)(vi)(vii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one month and fine shall not be less than two hundred rupees; (b) for a second offence such imprisonment shall not be less three months and fine shall not be less than two hundred rupees; and (c) for a third or subsequent offence such imprisonment shall not be less than six months and fine shall not be less than five hundred rupees. Section 80: Gaming in common gaming-house, etc.--Whoever is found in any common gaming-house gaming or present for the purpose of gaming shall, on conviction, be punished with imprisonment which may extend to three years and with fine up to rupees one lakh: Provided that,-- (a) for a first offence such imprisonment shall not be less than six months and fine shall not be less than ten thousand rupees; (b) for a second offence such imprisonment shall not be less one year and fine shall not be less than fifteen thousand; and (c) for a third or subsequent offence such imprisonment shall not be less than eighteen month and fine shall not be less than twenty thousand rupees. (9) Section 87: Gaming in public streets.--Whoever is found gaming or reasonably suspected to be gaming ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (11) Section 128A: Certain offences to be Cognizable, Non-bailable,--(1) All offences under chapter VII except section 87; and all offences under section 90, 108, 113, 114 and 123 under chapter VIII shall be cognizable and non-bailable; (2) Offences under section 87 shall be cognizable and bailable. (12) Section 176: Saving of games of skill.--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. Section 176: Saving of games of skill.--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. 2. AS TO WHAT IMPACT THE AMENDMENT HAS ON THE RIGHTS LIBERTIES OF INDIVIDUALS: (a) The Karnataka Police Act, 1963 was enacted by the State Legislature for the regulation of police force, the maintenance of public order and for the prevention of gamblin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... online games of skill when played with monetary stakes, is not disputed by the respondents. VI. A BRIEF HISTORY OF BETTING AND GAMBLING: (a) Acclaimed jurist of yester decades late H.M. Seervai in his magnum opus 'Constitutional Law of India' Volume III, Fourth Edition, Tripathi, at paragraph 22.262 writes: 'If the decisions of the US Supreme Court, Supreme Court of Australia or Canada, or the decision of the Privy Council can be referred to for showing the evils of gambling, there is no reason why references should not be made to Hindu Law and to Hindu religious books, or to Mohammadan Law, to show that gambling had been condemned in India from ancient times'. (b) Gambling is perhaps as old as mankind. Betting gambling have always been a part of several civilizations. The Greeks and Romans were among the first to practise gambling. Most of the scriptures, native foreign shun them. In India from time immemorial, sages had proscribed gambling as a sinful and pernicious vice. Sage Kanvasha Ailusha (Aksha Maujavant) had composed a cautionary poem/hymn in Rig Veda (10.34) which is titled The Gambler's Lament . It comprises monologue of a repentant gamb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting gambling': (a) There was a considerable discussion in the Constituent Assembly on the introduction of Entry 34 in the State List which was Entry 45 in the Draft Constitution. Two prominent members of the Assembly, namely, Mr. Shibban Lal Saksena Mr. Lakshminarayan Sahu had suggested for the omission of this Entry from the constitutional document, under a wrong impression that if omitted, there would no longer be betting or gambling in the country. Dr. Ambedkar erased their impression by the following reply: 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 purposes of prohibiting them. If this entry is not there, the provincial governments would be absolutely helpless in the matter... If this Entry was omitted, the other consequence would be that this subject will be automatically transferred to List I under Entry 91.... If my friends are keen that there should be no betting and gambling, then proper thing would be to introduce an article in the Constitu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llah in SAJJAN SINGH vs. STATE OF RAJASTHAN AIR 1965 SC 845. No law sings its intent to the subjects. One of the characteristics of enacted law (constitutional law included) is its embodiment in authoritative linguistic formulae. The very words in which it is expressed i.e., litera scripta constitute a part of the law itself. Legal authority is possessed by the letter of an enactment no less than by its spirit. Therefore in the case of enacted law, a process of judicial interpretation becomes necessary for ascertaining its meaning application. (b) The first ground vehemently canvassed by petitioners is that the subject amendment could not have been enacted for want of legislative power. Drawing the attention of Court to Entry 34 of State List which employs the term 'Betting and gambling' they contended that this term has acquired a constitutional significance having been so treated by the Apex Court in two CHAMARBAUGWALLA cases, K. SATYANARAYANA and K.R. LAKSHMANAN, supra. Learned Advocate General appearing for the respondents per contra contended that the legislative competence of the State extends to and beyond Entry 34. He points out Entry 1 (Public order), Entry 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titutional concept, i.e., 'Betting gambling' and not just two English words. Learned Advocate General's argument of 'widest amplitude' therefore cannot stretch the contours of a constitutional concept like this to the point of diluting its identity. Gambling, betting and other associated concepts are not of recent origin. They have been there in American and English realm of laws since centuries as mentioned in CHAMARBAUGWALLA-1 itself. We are not required to start afresh every time we want to examine the operation of some terms employed in the Constitution, even if it transpires that these terms do need a revised construction; we have a basis from which we can start our critique. In A-G FOR NSW vs. BREWARY EMPLOYEES UNION (1908) 6 CLR 469, 611-12, the High Court of Australia (5 judges) observed ...although we are to interpret the words of the Constitution on the same principles of interpretation as we apply to any ordinary law, these very principles of interpretation compel us to take into account the nature and scope of the Act we are interpreting, to remember that it is a Constitution, a mechanism under which laws are to be made, and not a mere Act which d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 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 exercise of skill is now recognized to be of a gambling nature. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to whether the rummy was a game of chance or a game of skill. Strangely, CHAMARBAUGWALAS I II do not find a reference in this decision; however, what the Court observed being consistent with the said decisions and the following observations are profitably reproduced: 12. ... The game of rummy is not a game entirely of chance like the three-card game mentioned in the Madras case to which we were referred. The three card game which goes under different names such as flush , brag etc. Is a game of pure chance. Rummy, on the other hand, requires certain amount of skill because the fall of the cards has to be memorised and the building up of Rummy requires considerable skill in holding and discarding cards. WE cannot, therefore, say that the game of rummy is a game of entire chance. It is mainly and preponderantly a game of skill. The chance in Rummy is of the same character as the chance in a deal at a game of bridge. In fact in all games in which cards are shuffled and dealt out, there is an element of chance, because the distribution of the card is not according to any set pattern but is dependent upon how the cards find their place in the shuffled pack. From this alone ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r 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. X. AS TO WHAT OTHER HIGH COURTS IN THE COUNTRY VIEWED GAMES OF SKILL AS: (i) The Punjab Haryana High Court in VARUN GUMBER, supra held that the fantasy games predominantly involve skill and therefore, do not fall within gambling activities and that the said games are protected u/a. 19(1)(g) of the Constitution. The matter went to the Apex Court in SLP No. 026642/2017 and came to be dismissed on 15.9.2017. (ii) A Division Bench of Hon'ble Bombay High Court in GURDEEP SINGH SACHAR vs. UNION OF INDIA was considering in PIL jurisdiction as to whether playing of fantasy games by virtual teams amounted to gambl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aj) was considering in PIL jurisdiction as to whether online fantasy sports/games offered on dream 11 platform amounted to gambling/betting. Having inter alia referred to CHAMARBAUGWALA and K.R. LAKSHMANAN, the question was answered in the negative and writ petition was dismissed with costs. The Court also discussed its decision in CHANDRESH SANKHLA vs. STATE OF RAJASTAN which had already considered the said issue. Further, challenge to the said decision in AVINASH MEHROTRA vs. STATE OF RAJASTAN SLP No. 18478/2020 came to be repelled by the Apex Court on 30.7.2021. It is relevant to mention that the Court referred to the decision of New York Supreme Court in WHITE vs. CUOMO 2020 NY Slip Op 00895, decided on 6.2.2020, which had taken the view that games of the kind were games of chance. This should be a complete answer to the learned AG who heavily banked upon decision of a US Court in support of his contention. Note: The collective ratio unmistakably emerging from all the decisions mentioned in paragraphs IX X above put succinctly is: A game of chance and a game of skill although are not poles asunder, they are two distinct legal concepts of constitutional significance. The di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sult of a game, those results depending more on chance than on understanding or ability. The Supreme Court of Israel in October 2018 decided a tax dispute in between AMIT AMESHVILLI RAFI vs. ASSESSING OFFICER Decided by Supreme Court of Israel in Civil Appeal No. 476/17, TEL AVIV (4) relating to winnings generated by a poker player in tournaments outside the country and opined that poker may not be a game of chance. (iii) 'The Gambling Law Review: Australia' by Jamie Nettelson, Shanna Protic Dib and Brodie Campbell dated 07.06.2021 mentions about a gambling case in LOTTOLAND AUSTRALIA PTY LTD. vs. AUSTRALIAN COMMISSION AND MEDIA AUTHORITY 2019 NSWSC 1041, decided by the Supreme Court of New South Wales which having analysed the distinction between a 'bet' and a 'game' in the context of Interactive Gaming Act 2019 (IGA) held that petitioner's products are betting products and it was providing a 'lawful gambling service' in compliance with the IGA. The inarticulate premise of this judgment is that gaming activities that involve skill do not fall into prohibited categories of gambling i.e., nearly our predominance test. XII. AS TO DIFFERENCE B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PRINTS, supra. They rely inter alia upon Entry 1 (Public order) and Entry 2 (Police). However, the invocability of this proposition is stoutly disputed by the petitioners in the given fact matrix of the case. The vehement contention of learned AG that several persons and families have been ruined because of online games and that all over the State, police have registered thousands of cases, may be arguably true. With the proliferation of online platforms, owing to the digital revolution, the entire landscape of gaming has undergone a 'cataclysmic change'. Young minds are prone to addiction to the cyber games, cannot be much disputed. All this however, does not fit into the parameters of Entry 1 (Public order) and Entry 2 (Police), of the State List howsoever liberally one may construe them. Games of skill have been judicially held to be 'business' activities protected under Article 19(1)(g) vide CHAMARBAUGWALA-II: at paragraph 5 it is observed: ...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)... It is pertinent to mention that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . India is a party signatory to the WHO w.e.f. 12.1.1948. Since 2014, WHO having conducted research and activities relating to the public health implications of the excessive use of internet, computers, smart phones other similar electronic devices, has in the 11th edition of the International Classification of Diseases (ICD-11) of 2018 clinically recognized the same as a pernicious syndrome. The pattern of gaming behavior is of such a nature intensity that it results in marked distress or significant impairment in personal, family, social, educational or occupational functioning. The health concerns associated with gaming behavior are not limited to gaming disorder but extend to other aspects of health such as insufficient physical activity, unhealthy diet, problems with eye sight or hearing, musculoskeletal problems, sleep deprivation, aggressive behavior depression and psychosocial functioning. They drew attention of the Court to the relevant part of the WHO literature at Annexure-R2, Volume I of the Statement of Objections dated 23.11.2021 contending that our Constitution being an organic document, the term 'Public health and sanitation' in Entry 6 of the State Li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 21 and therefore, there cannot be unreasonable restriction on the same. They submit that any legislative restriction for being valid has to pass the muster of Article 19(2) of the Constitution which enumerates specific grounds and that there is a heavier onus resting on the shoulders of the State to justify restriction which constitutes an absolute embargo. Learned Advocate General contends to the contrary pointing out the likely ill-effects of online gaming in general and their behavioral addiction potential qua the younger generation in particular. He submits that under our constitutional scheme, no rights of individuals are accorded in absolute term and that individuals' interest has to yield to the larger societal interest. According to him, the Amendment Act having been enacted keeping this in mind, cannot be faltered in Judicial Review. He also submits that in matter like this the judicial organ of the State should show due deference to the decisions of the Co-ordinate organ namely the Legislature. (b) In Harvard Law Review VOL-IV, December, 15, 1890, Samuel D Warren (Attorney) and Louis D Brandeis (later, Judge of US Supreme Court) in December, 1890 had propheticall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation to enhance individual capabilities... In the realization of basic rights, the State is subject to positive duties to further the fulfillment of freedom... (c) GAMES: THEIR NATURE IMPORTANCE TO MEANINGFUL LIFE: (i) Eric Berne, M.D., an acclaimed Canadian psychiatrist (1910-1970) in his GAMES PEOPLE PLAY (Penguin-1964) analyses games as an ongoing series of complimentary ulterior transactions to a well defined, predictable outcome. Descriptively, it is a recurring set of transactions, often repetitious, superficially plausible, with a concealed motivation; or, more colloquially, a series of moves with a snare or 'gimmick'. Games are clearly differentiated from procedures, rituals, and pass times by two chief characteristics: their ulterior quality and payoff... What is written on the blurb is even more instructive: We all play games. In the workplace, in the bedroom, even, when we are not aware of it. Every personal encounter is a mental contest, an opportunity to assert our will. (ii) Games involve the psychology of relationships and variable patterns of behavior that reveal the hidden feelings emotions of individuals and their underlying motivation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plays in facilitating artistic and scholarly endeavours of all sorts... The Court dealt with the right of telecasting sports and observed: In a team event such as cricket, football, hockey etc., there is both individual and collective expression...However, the right to freedom of speech and expression also includes the right to educate, to inform and to entertain and also the right to be educated, informed and entertained... The right to telecast sporting event will therefore also include the right to educate and inform the present and the prospective sportsmen interested in the particular game and also to inform and entertain the lovers of the game. Hence, when a telecaster desires to telecast a sporting event, it is incorrect to say that the free-speech element is absent from his right. XVI. VIRTUAL GAMES AND ELEMENTS OF EXPRESSION AS US COURTS VIEW THEM: (a) The enactment of Part III of our Constitution by the Constituent Assembly and its progressive interpretation by the Courts was influenced inter alia by the American jurisprudence. The growth of legal thought that occurs on a farthest foreign soil does influence others around the globe which has become small due t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ideas through familiar literal devices and features distinctive to the medium. The Court inter alia observed that the basic principles of freedom of speech do not vary with a new and different communication medium. (e) The views of Prof. Paul E Salamanca, University of Kentucky College of Law expressed in 'VIDEOGAMES AS A PROTECTED FORM OF EXPRESSION' published in Georgia Law Review, Vol. 40, No. 1 (2005) PP 153-206 are instructive: ...Courts have properly concluded that the First Amendment protects video games as a form of expression. These games possess all the characteristics of an art form. First, like other art, they are representational. They may look like universes full of gothic architecture, labyrinthine tunnels, and grotesque characters, but in fact they are electronic representations of such things, much like paintings, movies, or TV shows. Second, video games often have aesthetic value. The architecture depicted in a video game, for example, can be magnificent, squalid, or both. Indeed, many schools now teach the art and science of creating interactive video games. Third, these games often tie music and narration to the player's movement through the v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. (b) Robert H. Bork, a Judge of U.S. Court of Appeals for the D.C. Circuit, in his article Neutral Principles and some first Amendment Problems, published in Indiana Law Journal, Vol. 47: Issue 1 (1971), writes: An individual may develop his faculties or derive pleasure from trading on the stock market, following his profession as a river port pilot, working as a barmaid, engaging in sexual activity, playing tennis, rigging prices or in any of thousands of other endeavours.... Given the possibilities of expression in any medium, the guarantee enacted in Article 19(1)(a) (g) and Article 21 have to be broadly construed as to protect all forms of activities that further the self-realization of value. That is a premise implicit in these provisions. The Court interpreting the fundamental guarantees has to identify zones in which free people could experiment and develop their personalities in terms of enhanced character and virtue without causing excessive, immediate or discernible harm to others. Online games do not have any such demonstrable effect. (c) The predicate for Article 19(1)(a) is poised to include not only artistic expression having an outward effect upon soci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the negative impacts of the post mid-1980s gambling expansion... concerns about these impacts on the part of civil society and governments has led to policy and other initiatives intended to reduce harm associated with this expansion. There has been a focus on problem gambling and the provision of information, self-help and treatment... problem gambling and other gambling related harm are not widely regarded as a health issue or priority...Many of the non-gambling risk and protective factors for at-risk and problem gambling are common to other mental health and addiction disorders. Reducing these risk factors and strengthening protective factors can be expected to have health and social benefits that extend beyond problem gambling and gambling related harm...Additional risk factors identified in a number of studies include living in high deprivation neighbourhoods, membership of particular religious groups, lack of formal education and unemployed status...It appears likely that the combination of heightened vulnerability, economic and social disadvantage and high gambling exposure plays a major part in problem gambling development (Abbott, 2017a). (ii) The National Centre for R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TEIN AND INNENMINISTER DES LANDES SCHLESWIG-HOLSTEIN CASE European Court decision in C-46/08, 08-09-2010 decided on 8th September 2010. It should be noted that, in the same way, the characteristics specific to the offer of games of chance by the internet may prove to be a source of risks of a different kind and a greater order in the area of consumer protection, particularly in relation to young persons and those with a propensity for gambling or likely to develop such a propensity, in comparison with traditional markets for such games. Apart from the lack of direct contact between the consumer and the operator...the particular ease and the permanence of access to games offered over the internet and the potentially high volume and frequency of such an international offer, in an environment which is moreover characterised by isolation of the player, anonymity and an absence of social control, constitute so many factors likely to foster the development of gambling addiction and the related squandering of money, and thus likely to increase the negative social and moral consequences attaching thereto, as underlined by consistent case-law. What we cannot miss from the above is t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (d) In K.S. PUTTASWAMY, supra while considering data and informational privacy, what the Apex Court observed: Technology questions the assumptions which underlie our process of reasoning. It reshapes the dialogue between citizens and the State. Above all, it tests the limits of the doctrines which democracies have evolved as a shield which preserved the sanctity of the individual...India has participated in and benefited from the reconfiguring of technology by the global community. We live in an age of information and are witness to a technology revolution that pervades almost every aspect of our lives. Redundancies and obsolescence are as ubiquitous as technology itself. Technology is a great enabler. Technology can be harnessed by the State in furthering access to justice and fostering good governance... The hallmark of freedom is autonomy control over one's life and image as portrayed to the world. Privacy safeguards individual's autonomy and recognises the ability of the individual to control vital aspects of his life. Every individual is clothed with dignity liberty so that he is free to do what he will consistent with the freedom of others and to develop his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat 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. (b) Learned Advocate General appearing for the State contends that: the games of chance being res extra commercium, the games of skill fall within the field of 'Trade commerce' under Entry 26 of State List. The fundamental right inter alia of trade business is guaranteed under Article 19(1)(g) and therefore, the same is subject to reasonable restrictions imposed under Article 19(6). A reasonable restriction may also include an absolute embargo. Regard being had to enormous adverse implications of online gaming on the society in general and the younger generation in particular, the Amendment Act is made criminalizing the cyber games. In support of his contention, he banks upon CHAMARBAUGWALAS, K.R. LAKSHMANAN M.J. SIVANI, supra. He draws attention of the Court to a spate of suicides in the State, a plethora of criminal cases registered by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... damental rights, what is determinative is not the intent of the legislature but the effect of the legislation. Legislative action that is too disproportionate or excessive, may suffer invalidation on the ground of 'manifest arbitrariness' under Article 14 as discussed infra. Judge Aharon Barak of Supreme Court of Israel in his book 'PROPORTIONALITY: CONSTITUTIONAL RIGHTS AND THEIR LIMITATIONS', succinctly puts the doctrine of proportionality: It requires that a rights-limiting measure should be pursuing a proper purpose, through means that are suitable and necessary for achieving that purpose and that there is a proper balance between the importance of achieving that purpose and the harm caused by limiting the right . (e) In examining reasonableness of restrictions, both substantive procedural aspects enter the fray. That is to say, the Court should consider not only factors such as the duration extent of the restrictions but also the circumstances and the manner in which their imposition has been authorized. This apart, nature of the business sought to be restricted is also relevant vide COOVERJEE B. BHARUCHA vs. EXCISE COMMISSIONER AIR 1954 SC 220. This ne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purpose (iii) that there are no alternative less invasive measures and (iv) that there is a proper relation between the importance of achieving the aim and the importance of limiting the right. The Court in the said case held that a mere ritualistic incantation of money laundering or black money does not satisfy the first test and that alternative methods should have been explored...We cannot and need not go as far as the majority had gone in Bank Mellat. U.K. has a statute where standards of procedure for judicial review are set out and the majority decision was on the application of those standards. But even by our own standards, we are obliged to see if there were less intrusive measures available and whether RBI has at least considered these alternatives... We also shall be benefited by looking to what the Apex Court said in SHAYARA BANO supra: It will be noticed that a Constitution Bench of this Court in Indian Express Newspapers v. Union of India, (1985) 1 SCC 641, stated that it was settled law that subordinate legislation can be challenged on any of the grounds available for challenge against plenary legislation. This being the case, there is no rational distin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... skill which are distinct, in terms of content and produce. The State action suffers from the vice of paternalism since there is excessive restriction on the citizens freedom of contract. However, the ground of legislative populism does not avail against the plenary power of legislation. It has long been settled that the motive of the legislature in passing a legislation is beyond the scrutiny of courts vide a Five Judge Bench decision of the Apex Court T. VENKATA REDDY vs. STATE OF ANDHRA PRADESH AIR 1985 SC 724. (i) A mere likelihood or propensity of misuse of online gaming platforms, without anything more, does not constitute a legal justification for the banning of commercial activities. Article 300A has been expansively construed to include intangible property like intellectual property which is a product of original thought and skill, i.e., creation of the mind, and essentially used in commerce vide K.T. PLANTATIONS vs. STATE OF KARNATAKA (2011) 9 SCC 1. An activity predominantly involving skill cannot be readily banned at a stroke of legislative pen. In any organized society, knowledge, wisdom, talent skill are the invaluable tools for wealth generation. They are the uns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y be. (k) The Tamil Nadu Gaming and Police Laws (Amendment) Act 2021 that was put in challenge before the Madras High Court and the Amendment Act impugned herein are substantially similar in their text, context, object effect. They have been structured with the same jurisprudential concepts. What the Hon'ble Madras High Court in JUNGLEE GAMES supra observed being equally applicable to the Amendment Act here is profitably reproduced: The amended statute prohibited all forms of games being conducted in cyberspace, irrespective of the game involved being a game of mere skill, if such game is played for a wager, bet, money or other stake. Also, the main features of the Amending Act was to enlarge the inclusive definition of the word 'gaming' where the Section 3-A was introduced in the Act to prohibit wagering or betting in cyberspace and, the replacement of the substance of Section 11 of the Act that originally exempted games of mere skill from the application of the statute and its substitution by including games of mere skill also within the fold of offences under the statute, if such games are played for wager, bet, money or other stake. XX. AS TO WHETHER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of learned Advocate General overlooks one important factor: CHARMARBAUGWALAS 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 CHARMARBAUGWALAS is being revisited 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. XXI. AS TO DISCRIMINAT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be guided by any extraneous or irrelevant considerations because that would be denial of equality... (b) The amended definition of 'gaming' excludes in so many words, 'a lottery or wagering or betting on horserace 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce, 'headings and marginal notes are not voted or passed by Parliament, but are inserted after the Bill has become law' states Maxwell on Interpretation of Statutes, 12th Edn. Butterworths at page 11. Of course, since 2011, there is change in practice. In India, even headings are part of the Bill and are voted in the legislature. They provide the context for the substantive part of the section. They are there for guidance. Therefore, they cannot be ignored. Due significance has to be attached to the heading of a section in a statute. The substantive text of Section 176 makes the penal provisions enacted in Sections 79 80 inapplicable to 'any pure game of skill' i.e., a game predominantly involving skill. However, the Amendment Act deletes the term and to wagering by person taking part in such games of skill from the text of this section. Thus the amended definition of 'gaming' under Section 2(7) to the extent it does not admit the difference between skill games and chance games, is in direct contradiction to the amended Section 176 which intends to maintain such a difference. The very definition of 'gaming' as amended, suffers from the vice of ov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orbidden or required of them. A statute which ...leaves open, the widest conceivable inquiry, the scope of which no one can foresee and the result of which no one can foreshadow or adequately guard against...' offends this postulate of rule of law and therefore, is liable to be voided on the ground of 'manifest arbitrariness'. When a Statute is obscure or admits plural meanings with little for a common citizen to choose between them, there is absolute intractability of the language used. They operate as statutes of violence to the sensible citizens since they do not allow them to live securely under the rule of law. The Amendment Act suffers from the infirmity of this kind inasmuch as Section 2(7) which encompasses all games regardless of skill involved, renders the charging provisions enacted in section 176 read with Sections 79 80 of the Principal Act so vague that the men of common intelligence will not be in a position to guess at its true meaning and differ as to scope of its application and therefore, is liable to be voided. (d) The above view of ours gains support from the following observations of the Hon'ble Madras High Court in JUNGLEE GAMES, supra: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in DELHI CLOTH AND GENERAL MILLS vs. UNION OF INDIA AIR 1983 SC 937 supra has disagreed with contention of the kind by the following observations: Thus apart from the law being in a nebulous state, the trend is in the direction of holding that in the matter of fundamental freedoms guaranteed by Article 19, the rights of a shareholder and the company which the shareholders have formed are rather coextensive and the denial to one of the fundamental freedom would be denial to the other. It is time to put an end to this controversy but in the present state of law we are of the opinion that the petitions should not be thrown out at the threshold. We reach this conclusion for the additional reasons that apart from the complaint of denial of fundamental right to carry on trade or business, numerous other contentions have been raised which the High Court had to examine in a petition under Article 226. And there is a grievance of denial of equality before law as guaranteed by Article 14. We accordingly over-rule the preliminary objection and proceed to examine the contentions on merits. 9. In the above circumstances, these writ petitions succeed: 1. The provisions of Sections 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
