BENGALURU: A New Delhi-based online gaming company has moved the Karnataka High Court challenging the constitutional validity of the newly enacted Promotion and Regulation of Online Gaming Act, 2025.
By virtue of this Act, the entire skill gaming sector is being shut down, leading to a loss of livelihood of lakhs of employees, loss of investments made over time in this sector, and interference with the free will of players to exercise their right to play games of skill, the petitioners, Head Digital Works Private Limited, and another firm, alleged.
Justice BM Shyam Prasad said the plea will be heard on August 30 when it was mentioned before him by the counsel for the petitioners on Thursday for urgent hearing.
Challenging Sections 2(1)(g), 5, 6, 7 and 9 of the Act, which not only bans even online games of skill like rummy and poker, but also prohibits banks and financial institutions from facilitating financial transactions towards payment for any online money gaming service, and treats violations of the Act as a cognisable and non-bailable criminal offence, the petitioners stated that the Union government had taken a stand before the Madras High Court that states have the exclusive legislative competence to regulate online games of skills besides making a statement before the Lok Sabha on March 26, 2025, that the question of banning online gaming would fall to the domain of the states and outside the purview of the central government.
In the petition filed by Head Digital Works Private Limited, represented by its Chief Executive Officer Siddharth Sharma and Sumeet Singh Nindrajog from Mumbai, it was contended that the Union of India, by virtue of the impugned Act, prohibited and criminalised playing of online games involving stakes of any kind, whether or not such a game is of skill or chance.
It was alleged that the Act in question had been passed without consultation or deliberation.
This abrupt action has resulted in the potential disruption of the employment of 606 employees of the petitioner, and crores of rupees in investment in the petitioner company being lost overnight, but also the potential loss of livelihood of over two lakh employees across the sector, and has resulted in the total loss of over Rs 23,400 crore worth of investments.