Supreme Court orders Centre to examine legal gaps in online gambling regulation

The Supreme Court on Friday directed the Union Government to thoroughly examine concerns raised in a public interest litigation seeking a nationwide ban on online gambling and betting platforms that allegedly operate under the guise of social and esports games. The bench of Justice JB Pardiwala and Justice KV Vishwanathan heard the case filed by the Centre for Accountability and Systemic Change (CASC) and instructed officials to investigate and report back.

The petitioner highlighted a critical legal inconsistency: while the Centre has blocked approximately 1,528 gaming apps under IT intermediary rules, there is no explicit legislative prohibition on online gambling and betting. According to the Constitution's Seventh Schedule, gambling falls under state jurisdiction, though the Centre retains blocking authority.

A significant gap was identified in a Press Information Bureau note that claims online betting, gambling and lotteries would be blocked under new IT rules. Yet, the actual legislation contains no express ban. The petitioner emphasised that the new law endorses e-sports and social games, but nowhere prohibits betting and gambling activities.

The petition included a list of over 1,000 real-money gaming apps currently available on Apple and Google App Stores. The counsel urged urgent action before Diwali, citing the recent death of a 13-year-old boy in Kanpur after playing a prohibited online game. The petitioner claimed that despite government awareness campaigns, more than 1,000 children have died, demanding clearer warnings and stricter enforcement.

Filed on October 13 through advocates Virag Gupta and Rupali Panwar, the PIL names six respondents, including Union Ministries of Electronics and IT, Information and Broadcasting, Finance, and Youth Affairs and Sports, along with Apple Inc. and Google India Pvt. Ltd.

The petition cites alarming statistics: over 65 crore Indians engage in such games, generating annual revenues exceeding ₹1.8 lakh crore. The PIL characterises this as a national crisis linked to financial distress, mental health issues, and suicides, causing widespread social, economic and national security damage.

The plea seeks multiple directives: interpretation of the Promotion and Regulation of Online Gaming Act, 2025, alongside state laws to ban betting and gambling games masquerading as legitimate platforms; instructions to the Reserve Bank of India, National Payments Corporation of India, and UPI platforms to block financial transactions involving unregistered gaming applications; and investigations into offshore gaming operators through Interpol, CBI and the Enforcement Directorate, alleging tax evasion surpassing ₹2 lakh crore.

The petition also raises concerns about celebrities and cricketers endorsing such platforms, arguing these promotions fuel cyber fraud, addiction, and money laundering through opaque algorithms.