Bengaluru police cracks down on card rooms; poker & rummy clubs affected

The Bengaluru police under new Additional Commissioner of Police (Crime) Alok Kumar has undertaken a crackdown on the mushrooming card rooms in the garden city. According to a report in Bangalore Mirror, around 500 card rooms have been shut down in the city due to the police crack down.

It is understood that most card clubs, including poker and rummy clubs in the city have shut shop due to the police action, with no clarity emerging on whether they would be able to restart operations or if they intend to challenge the police crackdown in court.

Kumar told Bangalore Mirror that the objective was to curtail all illegal activities in the city. He added that it has been brought to the notice of the police that rowdy sheeters and criminals congregate at dance bars and card gambling centres and that often leads to drunken brawls and fatal street fights. Kumar also pointed out that many clubs are situated in residential areas and the residents of the area have lodged complaints about disturbance.

The police claim that the crackdown is mainly against card rooms which do not offer any other facilities to their members except gaming. According to Mirror’s sources, the clubs have been granted recreational licenses to offer card tables to its members on the condition that card games facilities are offered along with other avenues of recreation, such as sport and leisure facilities.

The Bengaluru police have further stated that the law enforcement authorities would allow clubs operating on a nominal membership fee and conducting small stake rummy games to continue their operations. However, the police sources added that action would be taken against clubs where large sums of money are being staked every day, for which no taxes are paid, indicating that such clubs would fall foul of the anti-gambling provisions in the state.

In 2013, the Karnataka High Court, in response to a petition filed by Indian Poker Association (IPA) had stated that poker if played as a game of skill can be conducted in recreational clubs. It will be interesting to see if the police action against poker and rummy clubs will be challenged on the basis of this order and other Supreme Court precedents that allow games of skill to be conducted.


Pokerbaazi launches new live poker room in Bengaluru

Online poker website Pokerbaazi has announced the acquisition of Phoenix poker room  in Bengaluru and rebranded it ‘PokerBaazi LIVE’. Pokerbaazi in its press release noted as follows:

PokerBaazi is one of the most popular online poker platforms in India and with good reason, the most trusted one. Founded in October 2014, PokerBaazi has transformed the poker industry with the implementation of a customer-first policy, best promotions and exceptional service. Having gained massive popularity over time, PokerBaazi is today one of the market leaders in the poker industry and has conducted tournaments and events pan India, including the recently concluded Baazi Poker Tour Edition 1 in Goa.

The acquisition is a continuation of the PokerBaazi’s journey to improve the gaming experience in India. Both, Phoenix Poker, which began operations three years ago and is among the most popular poker rooms in Bengaluru and PokerBaazi, have collaborated to offer a seamless gaming experience to poker players across both the platforms. With both brands sharing significant synergies, especially in creating a trusted, transparent and secure space to play for regs [sic] and beginners alike, Bangalorians and players from across the country can certainly look forward to good times ahead.

“With this significant partnership, we have enhanced our user base, giving players a secure and fair environment where they can learn and have fun” commented Navkiran Singh, CEO of Pokerbaazi.

It may be noted that more than half a dozen poker rooms are operational in Bengaluru as the Karnataka High Court has granted legal protection to poker by virtue of an order in favour of Indian Poker Association in 2013.  Pokerbaazi has captured a significant market share in an increasingly competitive online poker market.

Legal & Regulatory Poker

Kerala government considering notifying poker as a skill game, 1976 notification already grants immunity to rummy [Exclusive]

Exclusive The Kerala government has announced its decision to consider including poker and bridge in the category of games of skill by way of amending a hitherto unknown notification dated 30th September 1976.

The notification, unearthed  by Jay Sayta, founder of this website, is pursuant to Section 14A of the Kerala Gaming Act, 1960. Section 14A of the Kerala Gaming Act is a peculiar provision and is in addition to Section 14, which in general exempts games of mere skill from the ambit of gambling.

Section 14A is perhaps the only such provision in any gaming legislation in India that specifies that the government may, if they are satisfied that skill predominates chance, exempt such games from all or any provisions of the Act, subject to prescribed conditions. This provision allows  the state government to enlist games of skill. This clause also allows the government to impose any restriction on skill games

Based on this clause, the government in 1976 exempted rummy, dart throw, ball throw, shooting contests etc. from the penal provisions of the Gaming Act (thereby making playing of these games for stakes or real money completely and unambiguously legal and immune from any criminal liability). The only condition imposed by the government in the notification is that side-betting on the notified skill games is not permitted.

Sayta, based on this notification, wrote to the then Chief Minister Oommen Chandy, suggesting that the notification be suitably amended to include games like poker and bridge, since the element of skill outweighs the element of chance.  It was argued in the petition that the Karnataka High Court has already indicated poker to be a game of skill, while the statute in West Bengal also exempts poker, rummy, bridge and nap from the ambit of gambling. Additionally, it was stated in the letter, that the Nagaland legislative assembly has also enacted a new law to recognise and regulate online poker, rummy and bridge as games of skill.

The Chief Minister’s Office has responded to the application by referring it to the Home Department. Further, communication from the Home Department has stated that is considering the application and has already begun consultations with the Law Department on whether poker should be included in the notification exempting games of skill.

If the suggestions in the letter are accepted, it would be end any ambiguity on the legality of online poker and conclusively end any debate regarding the element of skill involved in the game. Perhaps, the next few months will be crucial for the skill games industry.

Business Gaming

Kerala government mops up almost $1 billion in lottery sales, Karnataka mulls the lottery route to generate funds

Lotteries organised by the Kerala government has grown exponentially in the past decade, as per data released by the state government. It is believed that the total annual sales of lottery in Kerala has grown from Rs. 557 crores five years ago to Rs. 5,696 crores (until February 2016). The expected turnover for the year 2015-16 is said to be Rs. 6,250 crores or US $911 million as per a statement by Chief Minister Oommen Chandy.

Chandy added that he intended to eventually increase the total turnover from lottery sales to Rs. 10,000 crores. He also noted that over Rs. 1,200 crores profit from lottery sales has been utilised for providing medical treatment to poorer sections of the society. Over 1,40,000 people are currently employed in the lottery trade in Kerala, mainly as agents and sellers, while over 3.90 crore lottery tickets are printed every week.

Additionally, thousands of other persons are indirectly employed in ancillary businesses like printing and stationery etc. Lotteries are extremely popular in Kerala and many people purchase the tickets as a major portion of the profits from lottery are utilised for alleviation of social problems. Kerala government sources indicate that the popularity of lottery schemes has also significantly reduced illegal gambling and matka activities.

Meanwhile, the Karnataka State Sellers (Agents) Lottery Union has urged the state Government to lift the ban on lotteries imposed in 2007. The Lottery Union added that the Karnataka government is loosing Rs. 10,000 crores of revenue because of its decision to ban lotteries, while increasing the flow of black money and other illegal activities. The Union added that like Kerala, Karnataka can also provide free medical aid to poorer sections of the society through lottery funds. Ramakrishna, the Association President added that opening up the lottery trade would also provide employment to lakhs of people as sellers and agents.

Commenting on the developments, Kamlesh Vijay, Group CEO of Sugal & Damani, one of the largest lottery distributors in the country said, “The idea of the Karnataka government and indeed all other state governments opening up the lottery trade has merit. Globally, funds from lotteries are used for socio-economic development and charitable causes. The three main benefits of legalising lotteries are increase in revenues to the state government, increase in employment opportunities and additionally it may also result  in  reduction of illegal gambling.”

Read more about Kerala state lottery.


Karnataka exploring the option of allowing offshore casinos

A recent report in The Times of India indicates that the Congress-led Karnataka government may be amenable to allowing offshore casinos in the state’s territorial waters to compete with Goa’s tourism industry. According to unnamed sources quoted by news reports, the Karnataka government is exploring two options to allow offshore casinos: the first option is to have a 3 day-4 night cruise ship from Mangaluru to different parts of the state. The second option is to allow casino vessels to be permanently stationed on the coast of either Karwar Belekeri, Tadri, Malpe, Old and New Mangaluru ports in the state.

On the record however, Principal Secretary (Tourism), Pradeep Singh Kharola is said to have denied any plan to permit casinos. However other sources suggest that the casino plan could be mooted during the Invest Karnataka 2016 event that the state government is slated to organise in February next year.

Karnataka joins a long list of states that are or have toyed with the idea of allowing casinos. Andhra Pradesh is said to be mulling a proposal to permit offshore casinos near Visakhapatnam city. States like Punjab, Haryana, Jammu & Kashmir, Odisha, Meghalaya etc. have also mulled over the idea but most of the proposals were shelved due to socio-political concerns. Maharashtra had passed a legislation allowing casinos way back in 1976, under the stewardship of Congress Chief Minister Shankarrao Chavan, but the law has not been implemented yet. The Bombay High Court has given the current government time till March 2016 to decide on the implementation of the law.

Karnataka Home Minister KJ George had made a statement in the legislative assembly in July this year indicating that a strong law to curb the menace of betting would be introduced. Interestingly however, George has been removed as the Home Minister recently and Dr. G Parameshwara has been given charge of the Home Department.

The term of the current Chief Minister Siddaramaiah is till 2018, leaving plenty of time to implement the casino proposal, if he desires to do so. It may be noted that legislation allowing casinos both in Goa as well as Maharashtra was passed by Chief Ministers belonging to the Congress party. As of now, there are more than half a dozen poker clubs operating in Bengaluru by virtue of a Karnataka High Court order directing the police not to interfere in the activities of poker clubs.

Business Legal & Regulatory

SC appointed black money SIT suggests stricter anti-betting regulations, Karnataka to bring new law against betting soon

There were two important updates concerning the gaming industry yesterday. Both measures can be seen as regressive measures for the gaming industry and may result in adverse regulations and more penalties for illegal betting and gambling.

SIT suggests legislative measures to curb cricket betting

The Supreme Court appointed SIT which is looking at ways to curb the the circulation of black money in the country suggested a rather regressive measure of imposing stricter penalties on cricket betting in its third report. The SIT headed by retired Supreme Court judge MB Shah stated that the government should consider bringing in appropriate legislative and regulatory changes to curb the menace of black money. The panel also added that new measures would deter citizens from indulging in illegal cricket betting.

As per media articles, the SIT report seems to have said the following: “It is apparent that illegal activity of cricket betting requires to be controlled by some provisions which are deterrent to all the concerned [sic]… considering the fact that large amount of black money is generated and used in this sector, it is suggested that some appropriate legislative directions or rules or regulations are required to be put in place to curb the menace of such betting…”

The stand taken by the SIT in its third report is surprising since the panel in its third interim report submitted in May 2015 endorsed estimates on illegal betting given in FICCI and KPMG reports (which supported legalising sports betting and gambling). This suggestion by the SIT is indeed a step in the wrong direction. Historical  evidence shows that prohibition of widely accepted activities (such as gambling, liquor or tobacco consumption) would only result in a boom for an underground economy and mushrooming of criminal elements. One hopes that the government focuses on legalising and taxing betting to reduce the flow of black money instead of accepting SIT’s suggestions.

Karnataka to bring a new law to curb illegal betting

In a related development, the Karnataka government announced that it is planning to introduce a new law to impose stricter penalties on illegal cricket betting and other gambling activities, possibly in the next assembly session. State Home Minister KJ George while replying to a question raised by opposition members stated that the state will introduce a new law to curb the menace of betting. George added that a new legislation to impose stricter penalties on illegal betting activities has become imperative since cricket betting rackets are ruining lakhs of families in the state.

It must be noted that some provisions in the Karnataka Police Act, 1963 currently imposes criminal sanctions for illegal gambling activities and running or participating in a ‘common gaming house’. The provisions of the Police Act are largely similar to the Central Public Gambling Act of 1867 and several other state gaming legislations. It remains to be seen whether the new law on betting amends the Police Act or brings a special legislation on the subject. It would also be interesting to see if the government also includes online betting and gambling within the ambit of the proposed law.