SC Seeks Centre’s Response On Plea To Regulate Betting Apps

The Supreme Court has reportedly sought response from the Centre on a public interest litigation (PIL) seeking regulation of all online and offline betting apps.

A PTI report said that a bench of justices Surya Kant and N Kotiswar Singh issued the notice to the Centre on a plea filed by K A Paul, who argued that many children had committed suicide after getting involved in online betting and gambling through apps.

The petitioner alleged that these online apps are being promoted by several influencers, actors and cricketers that draw children to betting.

“I am here on behalf of millions of parents whose children have died in the past couple of years. More than 1,023 people committed suicide in Telangana, as 25 Bollywood and Tollywood actors/influencers played with the lives of the innocents,” said Paul.

He further claimed that an FIR was also lodged in Telangana against the influencers as the issue violated fundamental rights.

Paul also alleged that former cricketers were promoting these apps leaving an impression on youngsters. 

In a response, the bench said it can’t do much as these were aberrations of society and enactment of law cannot stop people indulging in betting voluntarily.

The bench further sought assistance of the attorney general and solicitor general in the matter and said if necessary, it would seek response from all states voluntarily.

Nearly two years after the government sought to revise online gaming regulations, raising hopes of relief for an industry beset by uncertainty, little has actually happened.

Earlier this month, the Directorate General of GST Intelligence (DGGI) told the Supreme Court that online gaming companies are engaging in activities that qualify as betting and gambling, which are subject to the GST. 

The DGCI says that amounts staked by players in these games are taxable under the GST framework.

India’s gamer base expanded to 590 Mn by the end of 2024, making it the second-largest mobile gaming market in the world, according to a report by venture capital firm Lumikai. The country’s gaming market is further expected to cross $9.2 Bn by FY29, averaging a 20% annual growth rate, it projected. 

Real-money gaming (RMG) continues to be the largest revenue generator, contributing as much as $2.4 Bn to the overall revenue pool. 

Earlier this month, real money gaming startup GamesKraft announced a “strategic pause” on the operations of its poker platform, Pocket52. The startup said that the move is part of its broader plan to reassess and reimagine its long-term approach to the category.

GamesKraft is among the 71 companies that also include Dream11, Games 24×7, and Head Digital Works have received show cause notices totalling INR 1.12 Lakh Cr under the new tax regime.

The notices were dished out after a 28% GST was imposed on real money gaming in October 2023. The tax is levied on the total value of bets for online games, irrespective of whether they are games of skill or chance. Previously, a lower 18% GST was levied, specifically on the platform fee for skill-based games.