Guwahati: The Karnataka High Court is set to hear on August 30 a petition filed by leading online gaming company A23 challenging the newly enacted law banning all forms of online money gaming in India.
The plea was mentioned for urgent hearing on Wednesday by Senior Advocates C. Aryama Sundaram and Dhyan Chinnappa.
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The Promotion and Regulation of Online Gaming Act, 2025, which came into effect following President Droupadi Murmu’s assent on August 22, outlaws all online money games, irrespective of whether they are based on skill or chance. The bill had passed both the Lok Sabha on August 20 and the Rajya Sabha on August 21.
Under the new law, the judicial distinction between “games of skill” and “games of chance” has been removed, and any game involving monetary stakes is now prohibited. Offences under the law are classified as cognisable and non-bailable.
Individuals running online money games or processing related financial transactions can be arrested without a warrant, and authorities may conduct searches without prior approval.
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Violators may face up to three years in prison and fines of up to Rs 1 crore, with repeat offenders liable to mandatory minimum sentences and fines of up to Rs 2 crore.
The law also prohibits financial facilitation, barring banks, payment providers, and intermediaries from processing transactions linked to prohibited games. Additionally, a national regulatory authority will be established to register and classify games, issue directions, and ensure compliance.
The government defended the sweeping ban citing public health, financial security, and national security concerns. Officials highlighted manipulative and addictive design features in money games, rising cases of financial ruin and indebtedness, psychological harm among youth, and alleged links to money laundering, tax evasion, and even terrorism financing.
However, the legislation excludes competitive e-sports governed by sporting rules, as well as social and educational games without monetary stakes, and provides for their promotion within policy frameworks.
The government also noted the challenges of enforcing state-level restrictions against offshore operators, arguing that a complete prohibition is more practical and in the public interest than partial regulation.