NEW DELHI: The Law Commission is set to recommend legalising betting in sports and gambling. The commission will soon submit its report, a draft copy of which has been accessed by The Sunday Standard, to the government and the Supreme Court.
The panel is of the opinion that lawful but strict regulation of gambling and betting would help curb illegal practices that generate black money. It would also shore up revenues of the government and generate employment.
“If it is not possible to prevent such activities completely, strictly regulating these activities remains the only viable option. Regulated gambling would ensure detection of fraud and money laundering,” says the report.
In the commission’s estimate, unregulated gambling and betting currently generates about `13,000 crore. This is a major source of black-money and this untraceable money is often used for funding terrorist and other anti-national activities.
The apex court had mandated the commission to examine the issue of sports betting and gambling following the spot-fixing and betting scandal during the 2013 season of IPL.
Cricketers S Sreesanth, Ajit Chandila and Ankeet Chavan, the then BCCI president N. Sreenivasan’s son-in-law Gurunath Meiyappan, and several bookies were arrested in connection with the case.
Those who run sports betting and gambling businesses should be licensed, the money transfers should be cashless and gamblers and bettors must compulsorily link their Aadhaar and PAN cards, the Law Commission of India has recommended.
“In order to protect the vulnerable class of people from the ill-effects of these activities and with a view to enhance transparency, gambling and betting activities should be linked with the Aadhaar Card/PAN of the individuals and operators,” the commission says.
Cashless gambling and betting “would enable appropriate authorities to keep a close eye on every single transaction made in this connection. Cash transactions in this industry should entail penal consequences under relevant provisions of law.”
The panel studied the practices in many countries before preparing its report. While recommending that the businesses should be licensed, the commission wants match-fixing and sports fraud to be made criminal offences.
Betting or gambling is a state subject though they are loosely governed by an archaic national law, the Public Gambling Act of 1867.
Most states don’t allow gambling or betting, including lotteries. According to the law, games of chance or luck are prohibited but games of skill in which bettors have a thorough knowledge of the sport at the time of placing a bet, have no restriction.
This distinction means horse racing is the only sport in India in which betting is legal as it is considered a game of skill. That also means that betting in all other sports, mostly cricket, given its huge popularity in India, has thrived behind a veil of secrecy.
Sources said the commission was likely to suggest to the government that “games of skill” and “games of luck” should be more sharply defined.
Since only Parliament has the power to legislate on gambling and betting, the law panel feels it should enact a model law to regulate these activities. In one of the suggestions to “strictly regulate” these activities, the panel wants a cap on the number of times an individual can gamble and/or bet during a specific period.
The commission wants a ban on children from gambling and betting. It has suggested that gambling be categorized as “proper gambling” and “small gambling,” depending on the stakes involved, sources said.
“Proper gambling” would involve high stakes and would be feasible only for the rich. Poorer groups would be permitted “small gambling” with small stakes, the sources added.
The commission wants the businesses of bookies and punters to be taxed under the relevant laws. For legalisation of these activities, the panel also feels “suitable amendments” need to be made in Foreign Exchange Regulations and FDI policy.
Why did SC order examination of the issue?
Gambling and betting are illegal, but laws to deal with them are not clear. States can enact their own laws, but there is no uniformity
Most of these laws pertain to physical gambling and not online or virtual gambling
Section 67 of the Information Technology Act vaguely prohibits online transmission and publication of materials
In 2015, a Delhi court, while discharging cricketer S Sreesanth and 35 others in the IPL spot-fixing case, said cricket betting was not an offence