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The Legality of Online Gaming in India

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 There has been a great upsurge in the online gaming Platforms in these pandemics.

But there is a question which must have come up in the minds of most of you: ‘Whether Online Gaming is legal in India’, if yes so how come they are different from Gambling.

Well, the other question which must have arisen in the minds of most of you is ‘whether lottery or Online Lotteries are legal in India’.?

Online lottery may or may not come under the definition of gambling. There are no specific laws for the online lottery in India. But there are specific laws for gambling in India.

Let’s understand the concept of Online gaming, Online lottery and Gambling in detail.

Difference between Online gambling and Online Gaming

There is only a small line of difference between Online gambling and Online Gaming. One is a  Game of chance and the other is a Game of skill. 

Online Gaming is allowed in India but gambling is prohibited in India. However, some of the states of South India have also put a ban on online gaming as well by passing ordinance in their states.

Those online games which include an element of ‘ Game of Chance’ come in the ambit of Gambling, however, the Games which include an element of ‘Game of Skills’ come in the ambit of Online Gaming and not Gambling.

Section 12 of the Public Gambling Act, 1872 itself makes a difference between Gaming and Gambling, the section states that ‘Nothing in the foregoing provisions of this Act contained shall be held to apply to any game of mere skill wherever played. This act strictly prohibits Gambling.

Laws related to gambling and Lottery in India

Gambling is prohibited in India but Online Gaming is allowed in various parts in India.

Let’s understand the same with the help of various statues and examples:

  • Lottery Act, 1998

Section 12 of the lotteries Act, 1998 gives the right to states to make rules related to lottery 

As per the provisions of this act, the lottery is defined as a scheme in whatever form and by whatever name called for the distribution of prizes by lot or chances to those persons participating in the chances of a prize by purchasing tickets. 


As per the data of 2020, out of 29 states in India, there are only 13 states which have not banned the lottery, namely, Sikkim, Mizoram, Nagaland, Arunachal Pradesh, Kerala, Assam, Goa, Maharashtra, Punjab, Madhya Pradesh, West Bengal, Manipur, and Meghalaya. So, in short Lottery is legal in these states of India.


  • Public Gambling Act, 1872

This act Prohibits Gambling in Public. Every state has its own public gambling act, for example in Delhi we have Delhi Public Gambling Act, 1955 which prohibits wagering or betting in Delhi excluding Horse races and lottery. So, in short, lottery and horse racing is legal in Delhi. However, the Lottery is illegal in some states like U.P, Uttrakhand etc.

So, the legality and illegality of the lottery depend on the State Gambling Acts.

Why is it that Lucky Draw is Legal in India but Lotteries are not?

The NITI Ayog in 2016 has drawn a fine line between lucky draws and lotteries.

As per Section, 2(b) of the Lottery Act, 1998, a lottery is a scheme, in whatever form and by whatever name called, for the distribution of prizes by lot or chance to those persons participating in the chances of a prize by purchasing tickets.

So, for a scheme to be defined as a lottery, three elements are necessary 

  1. Chance
  2. Consideration(For purchasing Tickets).
  3. Prize or reward.

However, the second element, the element of ‘ Consideration’ is missing in lucky draws, so lucky draws don’t come in the ambit of lotteries.

Can you bring a suit for damages in court if you're deceived or cheated while playing the Lottery?

As per the provisions of Section 30 of Indian Contract Act, 1872, the agreements by way of wager are void and no suit shall be brought for recovering anything alleged to be won on any wager, or entrusted to any person to abide the result of any game or other uncertain event on which any wager is made.

So, no suit for recovery can be brought by a person if he/she is deceived in Lottery or Gambling.

States in which Online Gaming is banned

Various states in the south have banned Online gaming by passing an ordinance in their states regarding the prohibition of Online Gaming. 

Telangana was the first state to ban Online gaming followed by Tamil Nadu, Andhra Pradesh.

Also, Meghalaya has passed a law for the regulation of Online gaming, under the provision an online, an online game provider needs to take a license from the State and the Government has also set up an independent regulatory body called the Meghalaya Gaming Commission for monitoring all gaming activities in the state.

Also, the Hon'ble Supreme Court in the matter of Dr. K.R. Lakshmanan v. State of Tamil Nadu [1996] 2 SCC 226 held that:

 i. The competitions where success depends on a substantial degree of skill are not `gambling'; and

ii. despite there being an element of chance if a game is preponderantly a game of skill it would nevertheless be a game of "mere skill".

So,  always remember that

Game of skill= Game

Game of Chance=Gambling


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