Allahabad HC Directs UP Govt To Form Panel Over Online Gaming, Betting Regulation

Allahabad High Court

The Allahabad High Court has highlighted the inadequacy of the century-old Public Gambling Act, 1867, in addressing the modern challenges posed by online gaming and betting.

Noting that the Act applies solely to traditional forms of gambling, such as card games and physical casinos, the court took suo motu cognisance of the explosive growth in digital wagering and the resulting social and legal complications.

Constitution Of High-Powered Committee

To explore whether fresh legislation is needed, Justice Vinod Diwaker directed the Uttar Pradesh government to form a specialized committee. Professor K V Raju, the state’s Economic Advisor, will chair the panel. The Principal Secretary will serve as Member Secretary, and additional experts from relevant fields will be co-opted to provide insights on technology, law enforcement, public health, and economics.

Trigger For Court’s Intervention

The reference to digital gambling arose during the hearing of two petitions—one by Imran Khan—seeking to quash charges of running an online betting racket from home. The accused allegedly lured residents of Agra into wagering away their savings, amassing crores of rupees in the process. While the court ultimately quashed the proceedings on procedural grounds—observing that the police required a magistrate’s order to register a case for a non-cognisable offence—it underscored the broader urgency of regulatory reform.

Shortcomings Of Public Gambling Act

“The Public Gambling Act is a pre-digital law. It makes no mention of digital platforms, servers, or cross-border transactions. Its enforcement is limited to physical gambling houses and has no jurisdiction over virtual gambling environments accessed via mobile phones, computers, or offshore servers,” the court noted. Key deficiencies include:

No Definition of Online Gambling: The Act lacks any reference to fantasy sports, e-sports, or poker platforms.

Minimal Penalties: Existing fines and punishments are too small to deter large-scale operators.

Jurisdictional Ambiguities: Digital platforms often operate across state, national, and international borders, making enforcement complex.

Societal & Psychological Impact

The court observed how online gaming platforms deploy “psychologically manipulative algorithms, reward systems, and notifications” to encourage prolonged play. As a result, many young people face gaming addiction, anxiety, depression, and social isolation. “Students are increasingly distracted by online gaming, often at the cost of their academic performance and family relationships. The disruption of sleep cycles, lack of discipline, and social withdrawal are common consequences,” the judgment added.

Financial & National Security Concerns

Numerous betting operations are hosted on offshore servers, with transactions routed through unregulated channels. This setup not only hampers law enforcement but also elevates risks of money laundering, financial fraud, and even terror financing. The court stressed that tackling these threats requires a “modern, technology-sensitive legislation” capable of addressing both the psychological and national security implications of digital wagering.

The high-powered committee will assess whether existing laws can be amended or if comprehensive new legislation is warranted. Its recommendations are expected to cover:

Clear definitions and licensing regimes for all forms of online gaming;

Robust penalties calibrated to deter large operators;

Mechanisms to address cross-jurisdictional enforcement;

Safeguards against addictive design features; and

Anti-money laundering and anti-fraud provisions.

Conclusion

By initiating this examination, the Allahabad High Court has signalled the urgent need for India’s legal framework to catch up with digital realities.

Whether through amendment or fresh enactment, any new law must be capable of both protecting vulnerable citizens and safeguarding the integrity of India’s financial and security systems.