Online gaming Act challenged in Karnataka HC, hearing tomorrow

The operator of A23 Rummy, Head Digital Works, on Thursday moved the Karnataka High Court against the recently passed Central Act that banned money-based online games.

The HC will take up the petition, questioning the validity of the Promotion and Regulation of Online Gaming Act, 2025, on August 30.

The matter was mentioned before Justice BM Shyam Prasad, who directed that it be listed for hearing on Saturday.

The law, which received Presidential assent on August 22 after being cleared by both Houses of Parliament, prohibits the operation of “online money games” and also restricts associated banking services and advertisements.

The prohibition extends not only to games offered within India but also to platforms operating from outside the country.

Under the Act, an “online money game” refers to any Internet-based game —whether of skill, chance or a combination — where players pay a fee, stake or deposit money with the expectation of monetary or other rewards.

The Act further defines “online money gaming service” as any service enabling participation in such games. Violations will invite imprisonment of up to three years, fines up to Rs 1 crore or both. Advertising such games is also punishable with a prison term of up to two years or a fine of up to Rs 50 lakh.

However, the Act makes space for the recognition and promotion of e-sports — defined as competitive multiplayer online games conducted in organised formats, with outcomes determined by physical or mental skills such as dexterity, agility, or strategic thinking. Participation fees and prize money are permitted for these e-sports, but betting or wagering of any kind remains prohibited.

The law also provides for the creation of a central authority empowered to determine whether a particular game qualifies as an “online money game”. It also authorises designated officers to carry out searches and arrests without warrants, if there is reasonable suspicion of a violation.

Besides, non-compliance with certain provisions may lead to websites and platforms being blocked under the framework of Section 69-A of the Information Technology Act, 2000.