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This article has been written by Arundhati Roy, from RTI Cell, iPleaders and the article has been edited by Khushi Sharma (Trainee Associate, Blog iPleaders). 

Introduction

Playing cards for fun is a universal phenomenon, and in India, it is a regular affair to indulge in playing cards during spare –time or on any special occasion too. A card game means a game involving playing cards as the primary device for playing the game. Numerous games can be played by using cards, such as poker, rummy, solitaire, blackjack, drinking card games, baccarat, etc. 

When it comes to rummy, it is undeniably the most commonly played card game in India. Being the most infamous card game, it is said to have its origin in Spain. Rummy has gained much popularity with the inception of online rummy. In today’s world, the advent of the internet has made online rummy possible, which offers a competitive and much larger arena where the whole world is transformed into a platform wherein players from across the globe can play the game of rummy.

Through online rummy, players get the opportunity of playing while sitting in the comfort of their homes. Presently, well-known rummy operators are offering a whole new world of wonderful experiences with attractive offers, advertisements, cash rewards, a competitive feeling with the advent of new players from all over the world, and various other interesting options to choose from. However, rummy being a game of chance has attracted many controversies. Although Supreme Court declared rummy as a “game of skill” wherein players’ mental skill is required to win the game, it is still somewhere seen in common parlance with gambling. In order to find out the legality of rummy in India, various judgments of the High Courts in India and the Supreme Court have been analyzed in the present article.

Concept of ‘game of skill’

There is a need to comprehend the concept of the game of skill and game of chance. It is pertinent to mention that the Public Gambling Act, 1867 does not apply to the “game of skill.” The term “game of skill” means a game where the result is determined primarily by mental or physical skill rather than by chance. Whereas a game of chance is that where the outcome is strongly persuaded by some randomizing device such as spinning tops, playing cards, rolling dice, roulette wheels, or numbered balls drawn from a container. In a game of chance, there might be some involvement of skill, but chance plays a pivotal role in determining its result. When it comes to the game of skill, there may be a chance, but skill is the essential element in determining its outcome.

How safe is online rummy

The new technology has enabled the game of rummy to be enjoyed by everyone in India. Online Rummy operators provide fascinating opportunities to the players. These players get a chance to win real cash, sharpen their rummy-playing skills through several online practice modes. Since online rummy can be played by anyone sitting in any corner of the world, players get to test and enhance their skills when they compete with other worthy opponents. Thereby on winning, the players get to win real money.

However, many people are concerned over how safe and legal it is to play online rummy. Then another cause of concern that arises is, is the question of the fairness of the gameplay.

It is to be noted that certified online rummy apps and portals have integrated advanced and highly secured features of online payments and debit/credit cards, enabling players to use real money to play rummy and win the prize amount in a secure environment. Due to the availability of online payment methods, the transactions between the rummy players and rummy operators are safe, and the winning amount is automatically credited to the player’s account. Further, online rummy ensures that the likelihood of conflict due to human error in dealing with won or lost money is removed, which arises when rummy is played face to face.

In order to make sure that every player’s money lands in a safe place, operators who are certified to organize rummy have a standard payment gateway that is totally safe and secure. The most regular payment options are Paytm, PayU, NetBanking, UPI, etc. Rummy apps/portals are safeguarded with an SSL (Secure Sockets Layer) certificate, which makes the payments secure. An SSL Certificate is a digital certificate that authenticates a website’s identity and enables an encrypted connection.

Legal Status of online Rummy

There has been a doubt on the legality of the game of rummy wherein people often confuse it with gambling and betting. However, it should be noted that the Hon’ble Supreme Court has given the game legal status. The Supreme Court had held that rummy is a “game of skill” and not a “game of chance.” Therefore, it is legal to play rummy online to win of real cash prize. Pertinently, the game of rummy is legal because it is a game of skill and hence protected by the Constitution of India. Playing a game of skill like rummy is considered a business activity from a legal point of view, and such activity of playing a game of skill with cash is safeguarded under Article 19(1)(g) of the Constitution of India.

As such, there are no central laws against gambling or betting in India. Even the Public Gambling Act, 1867 does not prohibit gambling or betting; it merely penalizes. The legality of rummy or betting games in India is a state-specific matter.

Notwithstanding the decision of the Supreme Court, there are various states with their respective state laws prohibiting the playing of online rummy for real cash. These states are Karnataka, Andhra Pradesh, Odisha, Meghalaya, Sikkim, Nagaland, Assam, and Telangana. 

Supreme Court on legality of Rummy

Various petitions were filed by the clubs and online rummy companies challenging a March 2012 judgment of the Madras High Court, which declared rummy for stakes as a form of gambling and hence illegal. A Chennai-based club, Mahalakshmi Cultural Association, had brought to the court’s notice the instant matter. 

A bench headed by Justices Madan B. Lokur and S A Bobde was hearing a bunch of petitions and gave their verdict on the instant matter on 18 August 2015, which proved to be a boon for the ardent rummy players. The top court did not see any reason to interfere with the well-settled legal principle that playing a game of skill for stakes does not amount to gambling.

Earlier in 1968, the Supreme Court of India, in a ruling, had held that rummy card game is a game based on skill, and various subsequent judgments were delivered relying upon this decision. Later in 1996, the Supreme Court had delivered another judgment wherein it stated that:

  1. Competitions, where success depends on substantial degree of skill, are not “gambling”; and 
  2. Despite there being an element of chance, if a game is preponderantly a game of skill, it may be called a game of “mere skill.” 

Madras High Court: “Rummy & Poker” are games of skill

  • W. P. Nos. 18022 of 2020 

In the present case, the primary ground urged by the petitioners to challenge the impugned legislation viz. the Part II of the Tamil Nadu Gaming and Police (Amendment) Act, 2021 (Act 1 of 2021) by which the Tamil Nadu Gaming Act, 1930 was amended, is in it prohibiting games of skill, if played for any prize or stakes; which, according to the petitioners, is in flagrant disregard of the law laid down by the Supreme Court that competitions in games of skill are business activities and, thus, protected under Article 19(1)(g) of the Constitution of India.

A division bench of the Madras High Court consisting of Chief Justice Sanjib Banerjee and Justice Senthilkumar Ramamoorthy adjudicated the matter on 3 August 2021. The court, in its decision, has struck down the Tamil Nadu Gaming and Police Laws (Amendment) Act, 2021, which imposed a ban on the playing of games such as rummy and poker on cyberspace with stakes. Section 11 of the legislation further banned ‘mere skill’ games if such games are played for the wager, bet, or other stakes.

Arguments put forth by the petitioners were that the impugned legislation by prohibiting even games of skills if played for any prize or stakes violates Article 19(1)(g) of the Constitution. They relied upon the judgment of the Madras High court in the case of Dr. K.R Lakshamanan v. State of Tamil Nadu wherein, the court had explained in the context of placing bets on horse racing. The judgment stated that a game of skill may necessarily involve an element of chance, but the success therein would depend “principally upon the superior knowledge, training, attention, experience and adroitness of the player.” For the purpose of example, golf, chess and even rummy were considered to be games of skill, observed the Madras High Court.

The court observed that, “There appears to be a little doubt that both rummy and poker are games of skill as they involve considerable memory, working out of percentages, the ability to follow the cards on the table and constantly adjust to the changing possibilities of the unseen cards. Poker may not have been recognized in any previous judgment in this country to be a game of skill, but the evidence in such regard as apparent from the American case ever convinced the Law Commission to accept the poker as a game of skill in its 276th Report.”

Further, the Madras High Court had relied upon the Supreme Court’s verdict in the Dr K.R. Lakshmanan v. State of Tamil Nadu wherein it observed that a game of skill is distinct from a game of chance and if there is the preponderance of the skill element involved, then the concerned activity would be protected by Article 19(1)(g) of the Constitution and that competitions involving a game of skill must be regarded as business activities.

In view of the submissions made, it was held by the Madras High Court that games such as rummy and poker cannot be banned by the impugned legislation and that the legislation is ‘manifestly arbitrary’ and ultra vires of the Constitution.

Kerala High Court lifts ban on online rummy

– [W.P.(C)Nos. 7785, 7851, 7853 & 8440 of 2021] 

In the instant petition, the impugned question was regarding the power of the Government to include the game “Online Rummy played for stakes” within the purview of the Kerala Gaming Act, 1960. The petitioners are all companies that are engaged in the business of developing and offering online games of skill in India. The petitioners were aggrieved by the notification issued by the Government, amending the exemption notification issued on 30.09.1976 under Section 14A of the Kerala gaming Act. The notification stated that online rummy does not enjoy exemption from the general prohibition of gaming and gambling under Section 14A of the Act when played for stakes. 

The Kerala High Court, while quashing the said amendment to the Government notification issued under Section 14A of the Kerala gaming Act, 1960, which had put a ban on online rummy in the State, held that the notification is declared as arbitrary, illegal and violative of the fundamental rights guaranteed to the petitioners under Articles 14 and 19(1)(g) of the Constitution of India and hence not enforceable.

On the question of whether the power available to the State to issue a notification under section 14A to exempt a game, clothe it with a power to notify a game which is a game of mere skill under Section 14, the court held that “once a game comes within the purview of Section 14, any notification under Section 14A exempting it further as a game involving skill predominantly is only superfluous, and even without such a notification, the game stands exempted.”

Reliance was placed upon the judgments of the Supreme Court in the matters of State of Andhra Pradesh v. K Satyanarayana and Ors. And K R Lakshmanan v. State of Tamil Nadu & ors. by the petitioners, wherein the SC had held that rummy is primarily a game of skill. It was the contention of the petitioners that the ban on online rummy played for stakes, which was acknowledged as a game involving skill against the various decisions of the Supreme Court and High Courts.

Conclusion

In the light of the various judgments of the Supreme Court and various High Courts in India, it can be inferred that the game of rummy is instead a “Game of Skill” than a “Game of Chance” and a game of skill is legally valid in India. Also, Rummy apps and portals which are certified ensure that the players can have a secure, safe and healthy gaming environment. However, while considering the various legal aspects of online rummy, one can say that the legal status of online rummy suffers from a lack of uniformity concerning its legal position in different states, as each of the State has been empowered to make its own legislation for betting and gambling. The Supreme Court has laid down the game of skill vs. game of chance test to check the legality of online games such as rummy or poker. Nonetheless, the test was developed years ago and may require revisiting. There have been various interpretation of the Supreme Court’s decision that rummy is a game of skill. Similarly, as per Gujarat and Bombay High Court, the game of poker is a chance game, but as per Karnataka High Court, it is a skill game. 

It is pointed out that betting and gambling are not prohibited or illegal in India. However, running or maintaining common gaming houses for gains or stakes is illegal. And lastly, despite gaming operators ensuring protection to gamers, there are no safeguards to prevent gamers from getting exploited from the illegal activity which takes place in online gaming. Thus, a well-structured and all-inclusive legal framework for gaming is what we require to cater to India’s online gaming demands.


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