There’s no nationwide ban on lotteries in India. Nonetheless, thirteen states allow gambling in the country. The legality of gambling in India is based on a central law called ‘the Lotteries Regulation Act, 1998.’ According to the law, the State may conduct, promote, or organize a lottery if 11 conditions are followed. Nevertheless, in 2015 the Supreme Court of India allowed States to ban lotteries’ sales if they want. Though private lotteries were initially allowed in India, they were later banned in favor of State authorized lotteries.
So which states have authorized the legality of gambling in India?
There are 13 states out of 28 that have authorized the legality of gambling in India. These are:
Kerala’s revenue from lottery was Rs 9,276 crore in the fiscal year of 2019, while the estimated revenue from gambling for the State is Rs 11,800 crore in 2020.
Maharashtra generated Rs 9,034 crore in 2017-18. However, the average revenue per year of Maharashtra is about Rs 132 crores.
According to a Hindustan Times article, a laborer in the city of Punjab borrowed Rs two hundred to purchase a lottery ticket and won Rs one and a half crore.
● West Bengal:
As per the report composed by the All India Federation of Lottery Trade, the lottery business in West Bengal has added Rs 2,000 crores through the GST.
● Arunachal Pradesh:
According to The Economic Times, Arunachal Pradesh, the State which has legalized lottery, has created a record of a total revenue generation of Rs 1,598.49 crore in 2017-18
After the introduction of GST in 2017, Manipur has collected Rs 857.89 crore from the lottery business
● Madhya Pradesh
Bengaluru had a 30-year old thriving business of lottery until gambling was banned in 2007. Karnataka and Tamil Nadu were the key centers of gambling that later banned lotteries because of the social activists’ rising concern regarding people being addicted to gambling that lead to hurt their families.
Court’s decision on lotteries
According to article 40 of the Union list and article 34 & 62 of the State list in schedule VII of the Constitution, the union government is permitted to frame laws for the regulation of lotteries; however, state governments have the duty to authorize or conduct lotteries. In 2015, the Supreme Court of India had allowed states to ban lotteries, referring to the fact that selling lottery tickets is not a fundamental right as per the constitution. The lottery is not a free trade even if it is permitted by law like any other trade.
Why have some states prohibited lotteries?
The main reason behind the ban is the social effect on the common man. People, mostly earning members, were addicted to gambling even though lotteries are a major income source for many states.
So how effective is the ban in other states?
Banning gambling is like banning liquor in India; people will trade it one way or the other. The trade will continue but cut the states’ share of revenues. The ban on lotteries isn’t very effective, pushing the trade underground, as lotteries are now operated online with several innovative tricks, as witnessed in Karnataka’s recent events. So the best way in catering gambling is to authorize them, which would result in huge economic benefits for the country and the states.
The economic aspect of the legality of gambling in India
The lottery business is a major source of revenue for the Indian economy. As per the report composed by the All India Federation of Lottery Trade, lottery business has added Rs 4,000 crores through the GST to the Indian economy between 2017 and 2018; West Bengal contributed half of the mentioned amount.
So is betting in India possible?
If you want to play it illegally, the chances are more for going to jail than striking it rich. However, this is truth-less if you want to bet online. You’re free to play bets online in India, as no laws are prohibiting online betting.
What about the online lottery?
Playing the lottery is legal for citizens under certain conditions. First, the lottery has to be authorized by the State with a limit of once per week. As mentioned above, the Indian constitution gives each State a choice to make its gaming laws, including betting. One advantage that each State has is they can tax casinos and lotteries. With this, the amount of money collected through taxation is huge, as casinos and lotteries are widely popular in Indian culture.
The situation of the legality of gambling in India is pretty much confusing. Both online and offline gambling reaps huge profits as millions of people in India play it. Hence, if each State authorized and regulated lotteries, they can later use these revenues for better purposes.