Allow gambling in sports but regulate it, says law panel

The law panel suggests that the revenue generated can be used for public welfare activities.

The Law Commission of India on Thursday submitted a report to the government, saying that since it is impossible to stop illegal gambling, the only viable option left is to “regulate” gambling in sports.   -  V. Sudershan

The Law Commission of India on Thursday submitted a report to the government, saying that since it is impossible to stop illegal gambling, the only viable option left is to “regulate” gambling in sports.

The commission, headed by former Supreme Court judge, Justice B.S. Chauhan, recommended “cashless” gambling in sports as a means to increase revenue and deal a blow to unlawful gambling.

The money generated can be used for public welfare activities, it said. For that the revenue from gambling should be taxable under laws like Income Tax Act, the Goods and Services Tax Act.

Linked to Aadhar

Transactions between gamblers and operators should be linked to their Aadhaar and PAN cards so that the government could keep an eye on them, the panel said.

The commission recommended a classification of ‘proper gambling’ and ‘small gambling.’ Proper gambling would be for the rich who play for high stakes, while small gambling would be for the low-income groups, it said.

The panel wanted the government to introduce a cap on the number of gambling transactions for each individual, that is, monthly, half-yearly and annual. Restrictions on amount should be prescribed while using electronic money facilities like credit cards, debit cards, and net-banking. Gambling websites should also not solicit pornography, it said.

Regulations need to protect vulnerable groups, minors and those below poverty line, those who draw their sustenance from social welfare measures, government subsidies and Jan Dhan account holders from exploitation through gambling, the panel said.

According to the commission, Foreign Exchange Management and Foreign Direct Investment laws and policies should be amended to encourage investment in the casino/online gaming industry. This would propel tourism and employment, it said.

However, one of the members, Prof. S. Sivakumar, expressed strong dissent in a separate note filed with the government. He said the Law Commission report was not “comprehensive.” A country as poor as India should not allow ‘legalised gambling’ on its soil. He said such a move would leave the poor poorer and only vested interests want legalisation of gambling.

Mr. Sivakumar criticised the commission for exceeding the brief given to it by the Supreme Court in 2016. The court had merely asked the commission to look into the narrow question of legalising betting in cricket and not sports as a whole. The court’s reference had come in its judgment in the BCCI case involving illegal betting in IPL cricket matches. The dissenting note said the “recommendation may lead to an unhealthy and unwarranted discussion.”

Panel cites Mahabharat

But Commission report takes a page out of the epic, Mahabharat, to justify its call for regulation of gambling.

“There is merit in the argument that, had gambling been regulated at the time of the Mahabharat, Yudhishtir could not have staked his wife and brothers in a gamble,” the report signed by Justice Chauhan and five other Commission members observed.

The Commission said even as Indian society has traditionally frowned upon gambling, the argument made for ‘revenue over morality’ lacked merit. The Commission reasoned that online gambling and betting have acquired a global presence.

“Such activities, if properly regulated would ensure transparency in the market, as also strike at the underworld’s control over the illegal and unregulated gambling industry. Additionally, revenue so generated by regulating and taxing betting and gambling may become a good source of revenue, which in turn, could be used for public welfare,” the Commission report said.

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