The Supreme Court on Thursday briefly debated whether Parliament had exceeded its constitutional authority when it enacted the Promotion and Regulation of Online Gaming Act, 2025, as reported by The Hindu. The law bans real-money online games, related banking services and advertising nationwide.
A short but pointed exchange unfolded between the Chief Justice, the Centre and senior counsel representing gaming platforms. At issue was whether online gaming constitutes 'betting and gambling' under Entry 34 of the State List, which would place legislative authority solely in the hands of State governments rather than Parliament.
The Chief Justice announced that a three-judge Bench would undertake a detailed hearing in January 2026 to determine whether Parliament "acted beyond its competence".
Senior advocates C.A. Sundaram and Arvind Datar noted that a separate Bench led by Justice J.B. Pardiwala is also examining challenges to both the 2025 Act and State-level laws introduced by Karnataka, Tamil Nadu and others.
They urged the court to fast-track proceedings, citing significant job losses and industry uncertainty.
Solicitor General Tushar Mehta urged the court not to view the matter solely through a constitutional lens but to consider the policy rationale behind the legislation.
The Centre argues that online money gaming platforms cannot claim the right to trade or profession when their activities allegedly fuel addiction, financial ruin, and criminal conduct, including tax evasion, money laundering and cross-border illicit flows.
Government data suggests outward remittances linked to such platforms exceeded RS 5,700 crore in 2023-2024.
The court's eventual ruling could redefine regulatory boundaries between the Union and the States while shaping the future of India's rapidly expanding online gaming industry.
The Centre estimates that around 450 million people have been negatively affected by online money games, with losses exceeding RS 2,000 crore (US$240m)
