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Unraveling Legal Loopholes & Challenges For Indian Online Casinos

Unraveling Legal Loopholes And Challenges For Indian Online Casinos - Insights For Operators And Players

Akil Khan
by Akil Khan
August 4, 2023

Gambling is a game of luck or the game of chance. The Indian government only provided the case proceedings and legal framing, considering the game of skill. So, if you are looking for chances, my friend, you may land in a legal soup. Legal loopholes and a few challenges arise in the Indian gambling scene. The operators and players must take care of many things simultaneously if they want to withdraw their winnings and, simultaneously, do not want to end up in some mess.

Gambling Loopholes in Indian Legal System

One central law regulating gambling in India is the Public Gambling Act of 1867, which does not cover online gambling. However, the present regulations stated by the Income Tax Act state that casinos need to cut the TDS on players' winnings.

Whereas the punishment and legalities related to online gambling, there are no proper punishment procedures. A few legal acts state it as a non-bailable offense but a few more state it as a bailable offense. One has to pay a fine of INR 200/- only or serve up to three months in imprisonment. Most experts cite it as a mockery of the law with the loopholes of paying this minimal amount for defying the laws. 

A few cases in the past cited that no fine will be imposed on the games of skill. The players with the required skills in horse betting or Poker can exercise their skills to play the games and earn winning amounts. However, the new laws enacted in 2023 allow the taxation and cutting of TDS on the wins. The casino operator will deduct 30% of the player's winnings at the source. A few tax brackets are provided by the government under Section 194BA too. 

The government makes it difficult for punters to fund offshore accounts through new laws. However, gamblers always have ways to escape the government's wrath. The big thing is nothing under the new gambling laws. The players can get bail if they play the games of skill, lottery, poker, rummy, and horse betting.

Gambling Loopholes in Indian Legal System

Challenges Faced By Online Indian Casinos

The onset of the pandemic and digitization of the gambling industry has attracted Indian players to many offshore gambling sites that allow regulated gambling. However, the increasing addiction and the greed to make more money are landing players in the loop of expenditure. It is growing over its basic spending limit.

The foremost challenge the licensed operators face is operating in the country. The players are unable to get out of the loop of addictive gambling. Moreover, a few players have lost their money to unlicensed casino operators. For them, the challenge is to find the right operator. A few Indian players want to play anonymously, but the new cryptocurrency gambling is unavailable. Even a few offshore accounts offer net or debit/credit banking for Indian players. 

However, recent regulatory developments have made it difficult for the casino operators to regulate their business in the country. Certain reforms and 72 action points in starting or setting up any new business in India are becoming challenging. MeitY, on the other hand, has appointed the nodal committee to check the steps taken by the Ministry to keep a check on the illegitimate operation of the casino industry.

Another challenge that the Indian casino industry is facing is that the Indian 'indirect' tax authorities are issuing notices to the legit operators in the country. It poses a direct challenge to casino operators with a legit license from the jurisdictions like Malta Gaming Authority, Curacao Gambling Authority, Alderley Gaming Authority, UKGC, etc. 

Moreover, the government of India has now started to tax the games of skill too. Most top-tier states like Maharashtra, Tamil Nadu, Karnataka, and Telangana do not allow gambling. So, the players from these states will face heavy penalties and jail terms for gambling activities. The states like Sikkim, Nagaland, Goa, etc., allow land-based and online gambling, but punters playing at land-based casinos are covered under the legal standards. It leaves the licensed online casino operators in the lurch sometimes.

Challenges Faced By Online Indian Casinos

Current Legal Stand And The Status Of Indian Online Casino Market

If you look at the current legal status of the gambling market, the Indian government has imposed taxes at a 30% rate. The cess of 4% will be applicable too. Only the games of skill like poker, rummy, and horse betting do not attract any legal problems. 

Fantasy Sports, which allows sports betting, falls under the games of skill. The players can play it legally in the country, and the Fantasy Sports operators will not attract any illegal problems or notices.

The outdated laws governing the industry is already out, but the punters are finding new ways to escape the eyes of the government and earn big wins. Talking about the real money games that were previously banned online, the operators in Sikkim now provide real money online games. 

Future Gaming Solutions is the first online casino operator to receive a license of operation from the state of Sikkim. Maharashtra and other South Indian states still exercise the ban on real money games. However, the Indian players can only pay and play in the Indian currency. Now, Indian betting and gambling sectors in 2023 have started allowing for cryptocurrency and e-wallet methods too. 

Indian gambling laws are still fumbling over the correct and legit legislation regarding gambling and betting. The Indian players and casino operators must settle their stake, game, and quitting time. The land law can change at any moment. Indian gamblers and operators must refer the expert referrals and first-hand reports before playing online casino games. Well, you can only succeed if you become a risk-taker.

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Beyond chance: where gambling and Vedic astrology meet

Whether you like it or not, luck plays a crucial role in gambling. And while many would argue that it’s an unreliable force, for many Indians, the ancient tradition of Vedic astrology offers a way to understand how luck works in the universe and how one could potentially manipulate it to work in one’s favour.

Vedic astrology (known as Jyotish in Sanskrit) is the practice of studying planetary positions, celestial influences, and karmic patterns to understand how these influence and shape human lives and destinies.

When it comes to gambling, some Indians look to Vedic astrology to boost their chances of success. By analysing astrological charts and horoscopes, and identifying cosmic connections, gamblers seek to find the most advantageous time to gamble, looking for lucky combinations of numbers, or even charms and rituals to help improve their chances.

Let’s look at this more closely:

Planetary configurations

"Muhurtha", an essential principle of Vedic astrology, indicates the opportune time to partake in certain activities based on planetary configurations. It also highlights when best to avoid certain activities. So, in the case of gambling, a player would wait for a favourable Muhurtha to maximise their chances of success.

Presence of the planets

Vedic astrology focuses on nine “grahas”, which are collectively referred to as the “navagrahas” (nava meaning nine). They include the sun (Surya), moon (Chandra), Mars (Mangala), Mercury (Budha), Jupiter (Brihaspati), Venus (Shukra), Saturn (Shani), Rahu (north node of the moon), and Ketu (south node of the moon). According to Vedic astrology, the planet Venus offers luxury and Jupiter provides immense wealth. A conjunction of Jupiter and Venus unafflicted with the moon is therefore said to bring good luck and prosperity.

Birth charts

Many Indians strongly believe in analysing their birth chart in every aspect of their life. This comes from Vedic astrology, which argues that the alignment of different celestial bodies at your birth can provide invaluable insights. In the case of betting, it could highlight a person’s gambling and risk-taking tendencies and subsequent strategies they could employ to maximise their chances of winning, translating into profits and success.

Astrology and numerology

Hindus love to rely on their favourite numbers, particularly when it comes to gambling, and generally prefer odd numbers over even. Seven and eight are considered auspicious numbers, representing success and prosperity. Many Hindus also use these numbers at the time of Diwali when, in some houses, gambling is a ritual. Another lucky sequence of numbers in Hinduism is 786, representing the Trinity of Brahma, Vishnu, and Shiva.

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