Allow Gambling, Betting on Sports as Regulated Acts: Law Panel

Citing that it is impossible to stop illegal gambling, the panel said regulation is the only “viable option.”

The ministry has sought the help of UK counterparts in drafting the bill, where betting is legal.

(Photo: Wikimedia Commons)

The Law Commission of India on Thursday, 5 July, submitted a report to the government with the recommendation to legalize gambling and betting in sports, The Times of India reported. Conceding the inability to enforce a blanket ban and control the boom in the black money market, the panel suggested that the move be implemented, TOI reported.

“Since it is not possible to prevent these activities completely, effectively regulating them is the only viable option,” Times of India report added, quoting from the report.

Reasoning its call for regulation of gambling, the panel cited the Mahabharata, stating that regulation of gambling existed at the time of the ancient epic, The Hindu reported.

“Yudhishtir could not have staked his wife and brothers in a gamble,” The Hindu reported the panel’s observation.

Law Commission Chief Says Report ‘Misunderstood’

However, on Friday, 6 July, Law Commission chairman Justice BS Chauhan clarified to The Times of India saying the panel’s report has been misunderstood.

The commission clarifies it has strongly and categorically recommended that legalizing betting and gambling in India in the present scenario is not desirable and a complete ban on unlawful betting and gambling must be ensured.

BS Chauhan to TOI

Chauhan told TOI that the panel had merely given recommendation on what measures to adopt to regularize betting in case it is not possible to enforce a full ban.

Implement “Cashless” Gambling For Revenue, Link to Aadhaar, PAN: Law Panel

In the panel's report titled, "Legal Framework: Gambling and Sports Betting including Cricket in India," the panel has suggested introducing “cashless” gambling in sports as a means to increase revenue and to crackdown on illegal activities, The Hindu reported.

With vulnerable socio-economic groups depending on government subsidies, and social welfare measures for their subsistence, the panel observed that regulation will be instrumental in protecting them from exploitation, the daily’s report added.

In a move that will help the government keep a vigil on individuals indulging in gambling or betting, the panel suggested that transactions between gamblers and operators should be linked to their Aadhaar or PAN cards, The Hindu reported.

But all the operations may be “offered only by Indian licensed operators from India possessing valid licenses granted by a game licensing authority,” TOI quoted the caveat from the report.

In addition, the panel said the additional revenue generated should be taxable under laws like Income Tax Act, and the Goods and Services Tax Act.

Citing examples of legal betting and gambling in other countries like China where state lotteries touched a revenue of $51 billion in 2013, the panel suggested that money can be used for public welfare activities, reported TOI.

“...Categorise Gambling, Limit Transactions, Cap Amount Transferred": Panel’s Recommendations

The panel, in its recommendations suggested categorization of gambling into — ‘proper gambling’ and ‘small gambling.’

According to The Hindu, proper gambling would involve the ‘rich’ who play for high stakes, while small gambling would be for the ‘low-income groups’ who may not be allowed to dabble in high stakes transactions.

Among its recommendations cited by the TOI report, the panel suggested that a limit must be prescribed on the number of gambling transactions for each individual, that is, monthly, half-yearly and annual.

The transactions must be accompanied with a cap on the amount that can be transferred using money facilities like credit cards, debit cards, and net-banking, the TOI report added.

The panel also recommended that Foreign Exchange Management and Foreign Direct Investment laws be amended to attract investment in the casino/online gaming industry, reported The Hindu.

How Can the Govt Proceed?

Suggesting a way to execute the move, the panel recommended that Parliament may enact a law that states may adopt. On the other hand, the government may also exercise its powers under Articles 249 or 252 of the Constitution, reported TOI.

Only those states who agree to government’s legislation enforced under Article 252 may be free to adopt it, the TOI report cited.

Gambling being a state subject, allows them (under List II of the Seventh Schedule under the constitution) to formulate laws in accordance with the national policy on the act, TOI noted the panel’s recommendations.

“Legalisation Would Leave Poor Poorer”: Panel Member Criticises “Uncomprehensive” Report

Prof S Sivakumar, a dissenter on the panel, said ‘legalised gambling’ should not be done in India as it will further worsen the condition of the poor, The Hindu reported, quoting from his note submitted to Centre.

As reported by The Hindu, he further criticized the panel for not acting in accordance with SC’s 2016 recommendations which suggested a closer look at legalizing betting within the contours of cricket and not sports as a wide category.

(With inputs from The Times of India and The Hindu)