Betting has always been a part of our society. It has been looked down upon because of moral and religious perspective, and also laws have failed to prevent people from indulging in this activity because of its attractive results. It is a way of winning huge amounts with small investments and is a common pastime. It is widely practiced as entertainment mostly by the rich who are capable of indulging in bigger bets. Also, there are chances that people in a bid to earn quick money might resort to unlawful means.
Betting is per se illegal in India, but there are no specific laws to put a bar on it. The Public Gambling Act (1867) mentions that all kinds of gambling in India are illegal. It is also difficult to catch online offenders if the websites which are used are hosted by servers located in foreign countries where betting is legal.
Betting, Gambling, and Wagering
Betting is a word used to validate the activity of gambling. Betting basically involves transaction of money or any type of property for the purpose of guessing the outcome of a race, game, or any other unpredictable event and this may be done face to face, or through virtual means. Gambling is defined as the act of risking something of value for a chance to win a bigger prize. Whereas gambling is looked down upon in society, betting is considered comparatively normal.
Wagering, on the other hand, is considered to have various forms like gambling, betting, and gaming. Neither of the parties that have put money at stake should have any control over the event on which the amount is wagered.
Constitution of India and Betting
When the Constitution was being formed, a motion was taken up to add Entry 45, (present entry 34) dealing with betting and gambling, under List II of the Seventh Schedule. Later after much discussion, an Entry on ‘betting and gambling’ was included in the State list to empower the States to make laws either to prohibit betting or to regulate it, according to the requirements of the State. This provision provided the scope to accommodate different notions of morality prevailing in various States. The exclusive power of the State governments to make law on gambling can be traced to Entry 34 List II of the Seventh Schedule of the Constitution.
Article 39 of the Constitution also directs the State to provide adequate means of livelihood to every citizen and to make sure that the economic system does not lead to unfair accumulation of wealth, rather the ownership and control of the resources of the community are so distributed as best to subserve every class of society.
The Indian Contract Act, 1872 (Contract Act)
Section 23 of the Indian Contract Act, states that the consideration or object of an agreement will not be lawful if it is forbidden by law or is of such a nature that it is likely to defeat the provisions of law. This opens the gateway for Section 30 to come into operation which states that an agreement by way of the wager is “void and unenforceable, but at the same time it is not forbidden by law and hence, cannot be termed illegal.” In such a situation, no suit can be brought to enforce any winnings accruing out of winning a bet or gamble. However, this provision makes an exemption for betting on horse-racing, making them legally permissible under the Contract Act.
At present, there is no law that makes online betting an illegal activity. Foreign betting companies apparently use this ‘loophole’ to lure Indians to bet. The Indian Premier League (IPL) tops their lists now, and some websites have even hooked up with offshore betting agencies, thereby allowing Indians to place online bets. Indiabet.com, an advisory website, claims they don’t take bets but help in getting touch with international online bookmakers.
Betting through an international bookmaker, whether legal or not, is not clear in law. While bookmakers in India are illegal, there is no specific law in India which bans an individual customer from placing an online bet with a bookmaker based outside India. Bet365, one of the largest betting agencies in the United Kingdom, accepts bets from customers in every state of India. The rapid change in technology has opened new dimensions of betting, thereby creating a global market for it.
Nowadays, one can only bet on a few sports and that too in particular states. Currently, horse racing, online poker, online rummy, lottery, and a few casinos have been made legal in India. Whether the State has the right to regulate private morals, is a question that has been debatable. Those who argue in favor of legalizing gambling give primacy to individual autonomy and minimum State interference. Those who are not in favor of it argue that immorality is a justifiable ground for restricting individual liberty as such because it helps in maintaining societal order. But, there is an immediate need for specific betting laws in India for proper regulation.