Legal Question in Banking Law in India

14.08.2015

Dear Sir / Madam,

Constitutional provisions: As per the seventh Schedule of the Constitution of India (See entry no. 40 of List I and entry nos. 34 and 62 of List II), the Union government is empowered to make laws to regulate the conduct of lotteries, while the State Governments have been given the responsibility of authorising/conducting the lotteries and making laws on betting and gambling.

The following are the various laws which regulate/restrict gambling in India:

The Public Gambling Act, 1867: This Central legislation provides for the punishment of public gambling.

The Lotteries (Regulation) Act, 1998: This Central Legislation lays down guidelines and restrictions in conducting lotteries.

Section 294-A of the Indian Penal Code, 1860: This Section lays down punishment for keeping a lottery office without the authorisation of the State government

Section 30 of the Indian Contract Act, 1872: This Section prevents any person from bringing a suit for recovery of any winnings won by way of a ‘wager.’ (An agreement which is based on a future uncertain event wherein the loss of one person is the gain of the other). Thus no claim for recovery of any winnings in lotteries, gambling or betting can be brought before the court. The position of law in India is such that it may be perfectly legal to buy a lottery ticket, but the winner of such a lottery will have no remedy against the lottery agency if the said agency refuses to pay the winnings. This same position was reiterated in Subash Kumar Manwani v. State of M.P. (AIR 200 MP 109).

Regards,