The Supreme Court of India has ruled that state legislatures have the constitutional power to regulate and prohibit wagering and betting on games of skill. A division bench comprising Justice J.B. Pardiwala and Justice R. Mahadevan delivered this landmark judgment, allowing the appeals filed by the States of Tamil Nadu and Karnataka. The bench set aside the orders of the Madras High Court and Karnataka High Court, thereby declaring the statutory bans on online gaming with stakes to be constitutionally valid and intra-vires the Constitution of India. The decision addresses the growing socio-economic risks of online gambling, establishing that once monetary stakes are introduced into any game—regardless of whether it is based on skill or chance—the activity constitutes betting and gambling, making it subject to state-level regulation.
Background of the Case
The dispute arose from two separate legislative efforts by the States of Tamil Nadu and Karnataka to regulate the emerging cyberspace of virtual gaming.
In Tamil Nadu, the legislature enacted the Tamil Nadu Gaming and Police Laws (Amendment) Act, 2021 (the 2021 TN Amendment Act) to amend the Tamil Nadu Gaming Act, 1930. This amendment sought to curb online betting and the rise of virtual gambling houses, which were previously unregulated. Key modifications included amending the definition of “gaming” under Section 3(b) to include wagering or betting on any game played in cyberspace using electronic fund transfers. It also introduced Section 3-A, placing a blanket ban on wagering or betting in cyberspace on games such as rummy and poker under pain of imprisonment. Critically, Section 11 of the 1930 Act, which historically protected games of skill, was amended to apply penal provisions to games of mere skill if played for wagers or stakes.
The Madras High Court struck down Part II of the 2021 TN Amendment Act on August 3, 2021, in Junglee Games India Pvt. Ltd. v. State of Tamil Nadu. The High Court took the view that “betting” and “gambling” under Entry 34 of List II must be read conjunctively, concluding that the entry did not cover games of skill.
Following this, Tamil Nadu enacted the Tamil Nadu Prohibition of Online Gambling and Regulation of Online Gaming Act, 2022/2023. This Act was based on the recommendations of a five-member committee chaired by retired Justice K. Chandru. However, on November 9, 2023, the Madras High Court struck down the Act’s Schedule (which listed rummy and poker as prohibited games of chance) and read down Sections 2(i) and 2(l)(iv) to exclude these games.
In Karnataka, the state legislature passed the Karnataka Police (Amendment) Act, 2021, amending the Karnataka Police Act, 1963. The amendments expanded the definition of “gaming” under Section 2(7) to include online games involving all forms of wagering or betting, specifying that it covered risking money on an unknown result of an event, “including on a game of skill.” It also brought virtual platforms, cyberspace, and mobile applications under the definition of “place” and “instruments of gaming.” Additionally, Section 176 was amended to remove the protection previously granted to wagering by persons taking part in games of skill.
The High Court of Karnataka struck down Sections 2, 3, 6, 8, and 9 of the amending Act on February 14, 2022, in All India Gaming Federation (AIGF) v. State of Karnataka. The High Court held that “betting and gambling” under Entry 34 of List II must be read conjunctively as “betting on gambling activities,” thereby excluding skill-based games from the state’s legislative reach.
Arguments of the Parties
Submissions on Behalf of the States (Appellants)
Representing the State of Tamil Nadu, Senior Counsel Mr. Kapil Sibal argued that rapid technological development and digitization have led to a severe crisis of online gaming addiction, resulting in financial distress, unsustainable debt, and suicides. He highlighted that the World Health Organization (WHO) has recognized “gaming disorder” in its ICD-11 classification. Mr. Sibal submitted that the State’s legislative power flows not only from Entry 34 of List II (“betting and gambling”) but also from Entry 1 (“public order”) and Entry 6 (“public health”). He contended that the High Court had adopted an unnecessarily restrictive reading of Entry 34 and misapplied the legal precedents in State of Bombay v. R.M.D. Chamarbaugwala (RMDC-I), R.M.D. Chamarbaugwala v. Union of India (RMDC-II), and Dr. K.R. Lakshmanan v. State of Tamil Nadu.
On behalf of the State of Karnataka, Additional Advocate General Mr. Prateek K. Chadha argued that the 2021 Karnataka Amendment Act did not impose an outright ban on playing games of skill for leisure, but targeted the act of risking money on uncertain outcomes. He emphasized that the online environment is characterized by a “veil of ignorance” where players do not know if they are playing against actual humans, artificial intelligence, or manipulated bots, which heightens the gambling-like nature of the activity. He argued that the state has full competence to legislate on such activities to preserve public health, safety, and order.
Submissions on Behalf of the Gaming Companies (Respondents)
An array of Senior Counsel, including Dr. Abhishek Manu Singhvi, Mr. Arvind P. Datar, Mr. Aryama Sundaram, Mr. Mukul Rohatgi, Mr. Neeraj Kishan Kaul, and Mr. Sajan Poovayya, appeared for the various gaming companies and federations.
Their primary submissions were as follows:
- Constitutional Protection: Games of skill, such as rummy, poker, and fantasy sports, involve a preponderant degree of skill and strategy. Therefore, they are legitimate business activities protected under Article 19(1)(g) of the Constitution and cannot be classified as res extra commercium (activities outside commerce).
- Interpretation of Entry 34: The phrase “betting and gambling” under Entry 34 of List II must be read conjunctively. “Betting” only covers betting on games of chance (gambling). Staking money on a game of skill does not alter the fundamental character of the game.
- Precedents: They relied heavily on RMDC-I, RMDC-II, and K.R. Lakshmanan, asserting that the Supreme Court has consistently protected games of skill from being treated as gambling, even when played for stakes.
- Union Jurisdiction: It was argued that the regulation of online platforms operating via the internet falls within the exclusive domain of the Parliament under Union List Entry 31 (communications), Entry 42 (inter-state trade and commerce), and Entry 97 (residuary powers). They pointed out that the Ministry of Electronics and Information Technology (MeitY) has already enacted rules to regulate online gaming intermediaries.
The Court’s Analysis
The Supreme Court examined the scope of Entry 34 of List II, the relevance of past judicial precedents, and the alternative head of “public order” under Entry 1 of List II.
Scope of Entry 34 of List II
The Court strongly rejected the High Courts’ conjunctive reading of Entry 34, which had limited state competence only to “betting on games of chance.” The bench observed that the High Courts’ interpretation was a “Constitutional aberration, tinkering with the Constitution or actually rewriting the Constitutional text which Courts are not entitled to do.”
The Supreme Court explained that the terms “betting” and “gambling” are often used interchangeably in common parlance and both involve the core element of staking money on an uncertainty. The bench observed:
“The expression ‘betting and gambling’ cannot be split to mean that the staking angle alone would amount to betting whereas the risk angle or the chance element would amount to gamble.”
It was held that while a game of skill played without stakes does not amount to betting or gambling, introducing stakes entirely alters the activity from a societal perspective. The protection afforded to games of skill cannot extend to the act of betting on those games.
Analysis of Past Precedents
The Supreme Court clarified that the reliance placed by the gaming companies on RMDC-I, RMDC-II, and K.R. Lakshmanan was misplaced:
- The RMDC Cases: In RMDC-I, the Court was dealing with prize competitions that were inherently chance-based, where the “entry fee” paid by participants constituted the stake. The Supreme Court in the present judgment noted that RMDC-I had actually approved a quotation from Hamilton’s Hedaya, which states: “It is an abomination to play at chess, dice or any other game; for if anything is staked it is gambling, which is expressly prohibited in the Koran or if, on the other hand, nothing be hazarded it is useless and vain.” Since chess is a game of skill, this reference demonstrated that playing a game of skill for stakes has long been understood as gambling.
- K.R. Lakshmanan: The Court clarified that the protection given to betting on horse-racing in K.R. Lakshmanan flowed from specific statutory exemptions for “games of mere skill” that the legislatures of Tamil Nadu and Karnataka had themselves carved out at the time. In the absence of such voluntary statutory carve-outs, the legal protection does not exist. Furthermore, horse-racing involved highly regulated, physical betting within a club enclosure, which is completely different from the unregulated, borderless cyberspace of online gaming.
Manifest Arbitrariness and Article 14
The Court held that the state legislations do not suffer from manifest arbitrariness. The classification drawn by the states to prohibit online gaming with stakes is based on empirical studies and reports, establishing a direct, rational nexus with the legislative objective of preventing public harm.
Proportionality and Fundamental Rights
The Court ruled that once an activity is classified as “betting and gambling,” it falls under the category of res extra commercium. Consequently, the gaming platforms cannot claim protection under Article 14 or Article 19(1)(g) of the Constitution. Quoting its previous ruling in P.N. Krishna Lal v. Govt. of Kerala, the Court reiterated:
“No civilised society, therefore, would countenance that a citizen has a fundamental right to trade or business in activities which are criminal in its propensity, immoral, obnoxious and injurious to health, safety and welfare of the general public.”
Because there is no fundamental right to operate gambling enterprises, the test of proportionality does not apply, and the states are fully empowered to impose complete prohibitions.
Public Order as an Independent Source of Power
The Supreme Court held that the states also derive solid legislative competence from Entry 1 (“public order”) and Entry 6 (“public health”) of List II.
The Court observed that with the technological boom, the traditional mischief of “common gambling houses” has transformed because now, every single mobile phone has effectively become a “virtual common gambling house as well as the instrument of gaming.”
This pervasive access has led to widespread financial ruin, addiction, and suicides among lower-income groups and youth, directly breaching public tranquility. The Court observed:
“In terms of addiction, in terms of monetary losses and in terms of resultant widespread suicides respectively, online money gaming has a definite impact on the public. When such is the case, it has to be recognized that online money gaming has been disturbing the tranquility of the public by making betting and gambling more normalized and accessible. Therefore, public tranquility is breached and consequently, the States would have competence to invoke public order and seek to curb the mischief and restore public tranquility.”
The Court concluded that online gaming with stakes has created a severe public health and order crisis, giving states the constitutional authority to step in as parens patriae to protect their citizens.
The Decision
The Supreme Court allowed all the appeals preferred by the State of Tamil Nadu and the State of Karnataka. The Court set aside the impugned judgments of the Madras High Court and the Karnataka High Court.
The Court declared the following statutory provisions to be fully constitutional and intra-vires the Constitution:
- Part II of the Tamil Nadu Gaming and Police Laws (Amendment) Act, 2021.
- Sections 2(i), 2(l)(iv), and the Schedule to the Tamil Nadu Prohibition of Online Gambling and Regulation of Online Gaming Act, 2022/2023.
- Sections 2, 3, 6, 8, and 9 of the Karnataka Police (Amendment) Act, 2021.
No order was made as to costs.
Case Details
Case Title: State of Tamil Nadu & Ors. v. Junglee Games India Pvt. Ltd. & Ors.
Case No.: Civil Appeal Nos. 6124-6131 of 2023, Civil Appeal Nos. 8275-8279 of 2026, Civil Appeal Nos. 6132-6143 of 2023, and Civil Appeal No. 6144 of 2023
Bench: Justice J.B. Pardiwala and Justice R. Mahadevan
Date: May 27, 2026
