Categories
Legal & Regulatory

Insolvency petition against Play Games24x7 dismissed

Exclusive An insolvency petition filed by online affiliate marketing company Living Consumer Products Private Limited against RummyCircle and My11Circle parent company Play Games24x7 Private Limited was dismissed by the Mumbai bench of the National Company Law Tribunal (NCLT).

The NCLT proceedings filed by Living Consumer against the online rummy and fantasy gaming company was first reported by Glaws in August this year.

The two-member bench of NCLT while dismissing the petition, noted that since Play Games24x7 had replied to the demand notice sent by Living Consumer and also raised a dispute against the company, even before insolvency proceedings were threatened to be initiated, a petition for initiating Corporate Insolvency Resolution Process (CIRP) cannot be entertained.

The bench noted that corporate insolvency proceedings can be initiated in terms of Section 9(1) of the Insolvency and Bankruptcy Code, 2016 only if the corporate debtor does not respond with a notice of dispute within 10 days of receiving a demand notice from an operational creditor.

The NCLT bench observed that Living Consumer was required to provide marketing leads and drive traffic to Play Games24x7’s online gaming portal and a fee was to paid for the same based on the geographical location of the user.

Living Consumer raised an invoice of Rs. 6.35 crores for the services provided between 1st-15th December, 2018 which was not paid by the RummyCircle parent company.

Play Games24x7 while declining to make the payment served a legal notice to Living Consumer citing fraud in delivering the services.

According to the NCLT order, RummyCircle, during the course of its internal investigation is believed to have found out that its former Chief Marketing Officer, Sachin Uppal, and his immediate kin received Rs. 6.04 lakhs from Living Consumer as well as gift hamper from Living Consumer CEO Amit Vora as a bribe.

Play Games24x7 had further alleged that Living Consumer has made unauthorised use of its brand name and over-stated its fees by fraudulently passing off users from one state as being users of another state, as per a forensic investigation report by Deloitte Touche Tohmatsu India LLP.

Based on these facts, NCLT while rejecting the insolvency petition, noted that the tribunal has not decided on the merits of the claims made by Living Consumer, which can be agitated before an appropriate court of law.

In August 2018, Bhavin Pandya, CEO and co-founder of Play Games24x7 had in his comments on the insolvency case, had alluded to the prevalence of affiliate marketing fraud while declining to comment on the merits of the case.

Reacting to the current order passed by NCLT, Pandya said, “From the NCLT order, it is clear that the case wasn’t decided on merit but because of a pre-existing dispute. The NCLT’s view was to not entertain the matter and therefore dismissed it.”

Categories
Legal & Regulatory

Kerala HC says online rummy for stakes legality has to be reviewed on case to case basis

A division bench of the Kerala High Court comprising of Justices AM Shaffique and N Anil Kumar on 11th October delivered their order on a bunch of review petitions filed by online rummy website Ace2Three, RummyCircle and Junglee Rummy, challenging the court’s January 2019 order holding rummy for stakes to be an offence of gambling.

The court in its order on the review petitions at the outset admitted that a 1976 notification under Section 14A of the Kerala Gaming Act, 1960, that exempted rummy from the ambit of gambling, subject to the condition that side-betting is not permitted on such games, was not brought to its attention by the counsels arguing the earlier matter.

The existence of the notification and the court’s lapse in ignoring the said notification was first reported by Glaws in June 2016 and reiterated in February 2019, after which the counsels for the online rummy companies brought it up before the court.

The court in its order also alluded to the Supreme Court’s order in State of Andhra Pradesh v. K. Satyanarayana held that it cannot be said that rummy is a game of chance and there is no skill involved in it.

The court however, also noted the observation of the apex court in the order, that if there is evidence of gambling in some other way or that the owners of the house is making a profit or gain from the game of rummy or any other game played for stakes, the offence may be brought home.

KK Ravindranath, Additional Advocate General of the state of Kerala in his submissions noted that although playing the game of rummy is exempted from the Kerala Gaming Act by the 1976 notification, the issue of online gaming/rummy was not under consideration before the court in the original petition.

He further stated that only playing rummy is exempted under the notification and rummy, if played for stakes would amount to ‘side betting’ and offences under the Kerala Gaming Act would be attracted.

The High Court in its order, did not provide any clear answer to the applicability of the Kerala Gaming Act and 1976 notification on online rummy played for stakes. While disposing of the petitions, it noted that the applicability of the notification to online rummy and meaning of the term side betting has to be decided on a case to case basis depending on the manner in which the games are conducted and stakes involved.

The court in its final observations noted: “There is no dispute about the fact that in view of the notification, playing rummy is excluded from the provisions of the Act and in the impugned judgment the Division Bench has also held that the element of skill is predominant than the element of chance. But the question is whether if rummy is played for stakes, will it amount to violation of the provisions of the Gaming Act or not.

We are of the view that this aspect of the matter has to be decided on a case to case basis. What is the manner in which the games are conducted and how it is being conducted through online methods and what are the stakes involved in the matter are all issues which may arise for consideration. If it is just playing rummy without any side betting, the notification protects the parties involved in it. But, in a case where rummy is played for stakes, the issue might be different which has to be dealt with on a case to case basis. Therefore, the application of notification SRO No.1045/1976 will have to be adjudged depending on a case to case basis.

In the result, we do not find any ground to review the judgment. Review petitions are dismissed.”

The Kerala High Court with its order in the review petition has skirted the issue of whether online rummy for stakes can be legally conducted within the state and has consequently created more confusion rather than providing much needed clarity.

Categories
Legal & Regulatory

HC reserves order in Kerala rummy for stakes matter

A division bench of the Kerala High Court comprising of Justices AM Shaffique and N. Anil Kumar concluded hearing all arguments of the state government and online rummy companies on 24th and 26th September, in a clutch of review petitions filed by online rummy websites, RummyCircle, Ace2Three and Junglee Rummy.

The three leading online rummy websites had, through a review petition, challenged a January 2019 order of a division bench of the High Court which ruled that playing rummy for stakes amounted to the offence of gambling under the Kerala Gaming Act, 1960.

It is understood that the online rummy companies argued primarily on the basis of a 1976 notification issued under Section 14A of the Kerala Gaming Act, 1960 that exempts the game of rummy from the ambit of gambling and allows it to be played, subject to the condition that there is no side-betting.

The existence of the notification was first uncovered by Glaws in 2016. However, the Kerala High Court in its January 2019 order, perhaps in error or due to incorrect submission by the counsels of the parties stated that no such notification under Section 14A of the Gaming Act was issued by the state government.

Apart from Supreme Court and High Court precedents ruling rummy to be a game of skill and allowing it to be played for stakes, the online rummy companies’ stand was primarily based on this seeming error of ignoring the specific notification of the state government that was brought to their notice by Glaws.

After several adjournments, the High Court heard these submissions by the online rummy companies on 24th September and heard the contentions of the state government on 26th September, post which it reserved the order.

A written order on the issue is now expected to be given by the court within the next few weeks.

Categories
Legal & Regulatory

Gujarat, Kerala skill gaming matters marred by adjournments

Crucial matters pertaining to the legality of the skill gaming industry: a review petition on whether rummy for stakes can be permitted pending before the Kerala High Court and the letters patent appeal on whether poker is a game of skill in the Gujarat High Court were adjourned without being heard in the past few weeks.

A fresh division bench of the court comprising of newly appointed Chief Justice Vikram Nath and Justice A.J. Shashtri was supposed to hear the appeal against a 2017 single judge bench order ruling poker to be a game of chance on 16th September.

The clutch of petitions filed by Indian Poker Association Secretary KN Suresh, Dominance Games Private Limited, Aman Chhabra and Hotel Ramada, Ahmedabad, however could not be heard on 16th September and are now scheduled to be heard on 4th October, 2019.

Meanwhile, the review petitions filed by filed by online rummy websites Ace2Three, RummyCircle and Junglee Rummy against a January 2019 order of the division bench of the Kerala High Court saw three successive adjournments without much progress.

The matter, last posted on 4th September before a division bench comprising of Justices AM Shaffique and N. Anil Kumar has now been posted for hearing on 24th September, 2019.

It remains to be seen whether the matters on poker and rummy, critical to the skill gaming industry will gain momentum in the next few weeks or see further adjournments.

Categories
Business Gaming

Living Consumer files insolvency petition against RummyCircle

Exclusive Digital and affiliate marketing company Living Consumer Products Private Limited has filed an insolvency petition against online rummy website RummyCircle’s parent company Play Games24x7 Private Limited for alleged non-payment of pending dues.

Living Consumer Products, as an operational creditor, has filed the petition in the Mumbai bench of the National Company Law Tribunal initiating corporate insolvency process against Play Games24x7 for non-payment of dues for goods/services under Section 9 of the Insolvency and Bankruptcy Code, 2016.

The matter came up for hearing on 5th August, 2019 and the NCLT Bench asked Play Games24x7 to file its reply to Living Consumer’s claim by the next day, i.e. 6th August post which a rejoinder could be filed by Living Consumer Products.

The matter has now been listed for further hearing on 11th September, 2019 after all the replies have been filed.

Amit Vora, Director of Living Consumer Products declined to comment on the matter and stated, “As the matter is subjudice, I reserve my comments on this topic.”

Bhavin Pandya, CEO and co-founder of Play Games24x7 while declining to comment on the litigation alluded to the need to curb affiliate marketing fraud.

In an emailed statement he noted, “The affiliate marketing industry in India is rapidly evolving. With the increasing migration of services to the online medium, it is imperative that the online affiliate marketing industry also follows high standards and responsible business practices. One of the challenges faced by advertisers is affiliate fraud at all scales by some small or big online marketing affiliates.

This is not a new problem however in the more mature affiliate marketing industry in the West, both parties, the advertisers and the affiliates have understood the value of working with their interests aligned and therefore are naturally moving towards revenue sharing arrangements. This industry being new in India, these models are yet to evolve on the backdrop or more transparency and willingness to share data between stakeholders.

At RummyCircle and My11Circle, we are constantly improving our systems by running real time data science models to detect affiliate marketing fraud. The Company has also faced issues of misreported acquisition data and is able to now substantiate, with its own data, and take quick corrective action to mitigate losses and clean up the practices at the end of the affiliates. It is not surprising that some operators who look at short term gains, resist the idea of transparency for short term business objectives, however, this is not good for the health of the online marketing industry and eventually will destroy creativity and competition.

Given where the industry is right now, accountability of reporting relevant user information to detect fraud is a challenge due to lack of proper information sharing by the affiliates. The Company however is committed to use technology and data science to improve this industry and hopes that these steps help every stakeholder in the long run. The Company cannot comment on the specifics of a dispute with any vendor that is pending adjudication and it is appropriate to await the outcome of the adjudication process.”

Categories
Legal & Regulatory

Online rummy companies file review petition in Kerala HC, matter to be listed on 19th July

At least three online rummy companies, including Play Games 24×7 Private Limited (RummyCircle), Head Digital Works Private Limited (Ace2Three) and Junglee Games India Private Limited (Junglee Rummy) have filed review petitions in the Kerala High Court seeking reconsideration of the January 2019 order of a division bench of the court which held that playing the game of rummy for stakes or wagering on it is not just an innocent pastime but amounts to the offence of gaming under the Kerala Gaming Act, 1960.

The review petitions filed by the online rummy companies came up before a division bench of the Kerala High Court comprising of Justices AM Shaffique and N. Anil Kumar yesterday. The court however, adjourned the petition for two weeks and has now listed the matter for hearing on 19th July, 2019.

As noted by Glaws in its analysis in an exclusive article on 28th February, 2019, the Kerala High Court seems to have made an apparent error in its judgment by overlooking a 1976 state government notification that clearly exempts six games including rummy from the ambit of the Kerala Gaming Act, subject only to the condition that side-betting is not permitted on such games.

The Kerala High Court probably guided by erroneous submissions by the counsels appearing in the case, in fact, stated in its judgment that no such notification exempting certain skill games under Section 14A of the Kerala Gaming Act existed.

According to the available court records, in the earlier hearings of the review petition filed by Play 24×7 Games, the court had asked the Additional Advocate General to get instructions from the state government on the matter.

It remains to be seen whether the Kerala High Court modifies or revises its January 2019 order based on the 1976 notification and other precedents regarding rummy being a game of skill and allowed for stakes being brought to its notice.

Categories
Gaming

Sourav Ganguly endorses fantasy sports website My11Circle

Former India cricket captain Sourav Ganguly has joined online fantasy gaming website My11Circle as its brand ambassador, as per an announcement made by the company.

Promoted by PlayGames 24×7 Pvt. Ltd. (which operates one of the largest online rummy websites RummyCircle and social gaming portal Ultimate Games), My11Circle is one of the recent entrants in the already competitive fantasy sports market.

Commenting on the development, Ganguly noted in a press release, “I am very excited to be part of this fun game, especially because it is about cricket. Makes me feel involved in the game. I think the players on My11Circle will also enjoy the game thoroughly. Waiting for lots of action and lots of fun with players from all over the country,”

Avik Das Kanungo, Brand Head of Play Games24x7 said: “We are very lucky to have Sourav as part of the My11Circle family. This game is about cricketing knowledge, passion and decision making. The app is looking at scaling up their presence with Sourav Ganguly who took Indian cricket to new heights. Every player on our app is like a cricket captain and picks his / her own cricket team and everyone knows that Sourav is the best when it comes to this. I am confident that our players will also look forward to this exciting journey with Sourav on My11Circle.”

Saroj Panigrahi, Business Head My11Circle, said, “As a game of skill, My11Circle connects the cricket fan with a platform where they can exhibit their knowledge and expertise of the game. It is an opportunity for them to become a champion. Our campaign with Sourav Ganguly is true to our brand’s belief of not just celebrating the success of the matches but also about the fans, who together make cricket such an awesome game”.

Ganguly joins other former and current cricketing legends such as MS Dhoni, Rohit Sharma, VVS Laxman, Jonty Rhodes and Hardik Pandya in endorsing fantasy sports websites.

Launched in January this year, My11Circle states that it intends to change fantasy gaming experience for players by having various features such as live scores and updates and faster cash rewards.

Read more about online gambling and betting in India.

Categories
Gaming

RummyCircle parent company launches new fantasy website My11Circle

Play Games24x7 Private Limited, the parent company of online rummy market leader RummyCircle, has launched a new fantasy sports portal called ‘My11Circle’.

The My11Circle platform is slated to initially offer fantasy sports contests on domestic and international cricket games, and is scheduled to also add other sport contests in the near future.

The company, through a press release, noted the USP of My11Circle would be fast cash rewards and live player statistics as well as live scores that would be available on the platform.

Commenting on the launch, Bhavin Pandya, Co-CEO and Co-Founder of Play Games24x7 noted, “Today is a very important day for Play Games24x7 as we launch our first ever fantasy game. We, of course, start with cricket but the goal is to offer multiple games in this format. Our focus on understanding player behavior has enabled us to provide awesome game playing experiences and we shall continue that endeavor by providing awesome fantasy cricket experiences to our players.”

Saroj Panigrahi, Business Head,  My11Circle added, “Play Games24x7 has a history of successful growth across different product platforms and is excited to introduce the My11Circle fantasy sports app for all Indian cricket lovers. Fantasy sports has great potential in our country and complements Play Games24x7’s existing portfolio perfectly.”

Besides RummyCircle, PlayGames24x7 has a social gaming mobile app called ‘Ultimate Games’ that offers games like poker, teenpatti and cricket betting. In September last year, the company had announced that it would be launching a real money horse betting website called ‘Turfbets’. The plan was later shelved as the company felt that the website could be misconstrued as a gambling product.

Categories
Gaming

RummyCircle shelves plan to launch horse betting website

Exclusive Weeks after Glaws exclusively reported that Play Games24x7 Pvt. Ltd., the parent company of leading online rummy website RummyCircle had decided to launch TurfBets.com, a portal where Indian residents can bet real money on International horse races from countries like United Kingdom, USA, France etc.; it has now emerged that the company has temporarily shelved its plans of launching the real money horse racing website.

It is understood that the company was only testing the product and response that it would receive within a closed group of persons. It is further learnt that the company was not prepared or willing to take the risk by launching an innovative website which can potentially attract negative publicity and be misunderstood as a gambling product.

As of 20th September, 2018, the TurfBets website homepage showed that the portal would be launched in the next four days. However, as of today (4th October) the website is taken down and it is shown that the page is not working due to an empty response from the server.

Although the WhoIs records on 20th September indicated that Mumbai-based Play Games24x7 was the owner of the domain ‘turfbets.com, it seems that the records have been modified and the WhoIs registry now no longer indicates that the website is owned by Play Games24x7 Pvt. Ltd.

The company has not officially indicated any reasons for discontinuing the website and whether or when it would relaunched. Glaws has reached out Play Games24x7 officials for a response. The story will be updated if and when a response is received.

Categories
Gaming

RummyCircle to start horse betting website TurfBets

Exclusive Play Games24x7 Pvt. Ltd., the company that operates leading rummy website RummyCircle, will be launching a new real money betting website focused on International horse racing in the next few days.

The website, called ‘turfbets.com’ is registered under the name of Play Games24x7 Pvt. Ltd Mumbai. As per an exclusive invitational preview link accessed by Glaws, the website TurfBets will aim to give customers based in India the best horse betting experience with races from North America, United Kingdom and France. The website further states that customers can play different races from different countries, sitting right here in India. Further, TurfBets can stream hundreds of races per day through our exclusive video player.

The services provided by the website include allowing users to place bets on live international races, providing live stream of the races and providing historical information about the performance of each horse and other race conditions.

The website is expected to start its services, initially limited to a closed group of 1000 people within the next four days. TurfBet further states that players from Assam, Odisha and Telangana are not allowed to play online horse races for prizes, given that these states do not allow games of skill for stakes.

The promoters of RummyCircle seem to have taken advantage of the fact that the Supreme Court in a judgment in Dr. KR Lakhsmanan v. State of Tamil Nadu in the year 1996 ruled that horse racing, like rummy, is a game of skill and betting and wagering on the same would consequently not fall within the ambit of gambling.

It however remains to be seen whether the innovative model adopted by RummyCircle promoters to use observations made by the Supreme Court to conduct online betting on foreign horse races will fall into any legal troubles.