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Saturday, 07 July 2018 00:00
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Sarthak edit

The Union government should seriously consider accepting the Law Commission’s suggestion to legalise sports betting and gambling in India. The Law Commission is of the view that, since it is impossible to prevent gambling and betting entirely—more so with online gambling—it is better to legalise these and form laws to regulate such activities to reduce criminality. While that is an obvious gain, this will also mean revenue gains for the government. Given how gambling is a state subject, the panel says that the Centre could enact a model law for the states to adopt, or even use the powers under Articles 249 and 252 that allow it to make laws to regulate matters under the state list of subjects in the larger national interest.

From animal fights to playing cards on Diwali, and from horse-races to cricket matches—gambling/betting on sports is quite common in India. While most state laws in India that make gambling/betting illegal draw from the Raj era Public Gambling Act, the UK itself has legalised gambling. India, keeping gambling illegal, has let organised crime benefit from it. The Justice Lodha committee on the reform of cricket administration in India had pointed out how the hawala system used illegal cricket betting and had made money laundering “an inevitable outcome”. The high stakes and underground operations also facilitated the entry of organised crime and the rise of match-fixing. Also, Ficci, in 2016, estimated the illegal market’s worth to be nearly `10 lakh crore. This demonstrates the significant chunk of revenue that the government is losing out on by forcing gambling/betting activities underground—in terms of licensing fees, GST on betting services and taxes on winnings.


To the extent that the Law Commission recommendations will help keep track of the activities—the panel has suggested that all transactions should be linked to the Aadhaar and PAN of operators and participants—the betting industry could get reasonably sanitised. Legalising gambling will also clear up many distortions. In 1996, in KR Lakshmanan vs the State of Tamil Nadu, the Supreme Court had ruled that competitions where success depends on a substantial degree of skill would not fall into the category of “gambling”; and even where there is an element of chance, if a game is largely a game of skill, it would nevertheless be called a game of skill. While betting in horse-races got legalised, the same in many other sports remains illegal. India can choose to look at gambling and betting as a revenue-source and to encourage job-creators, like some jurisdictions do, or treat it in a morally-neutral manner and focus on reducing social costs such as addiction and bankruptcy—what it must do, though, is legalise the activities.



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