REAL-MONEY GAMING IN INDIA
(iii)
Abetment liability
up to INR 10,00,000 (Rupees Ten Lakhs) (approx. US$11,273). 53 Penalties may also include suspension or cancellation of registration, and prohibitions on offering, facilitating, or promoting such online game. Additionally, the OGAI may impose penalties for other non-compliance under the Act or Draft Rules. 54 The Draft Rules set out the procedure to be followed before any penalty is imposed. Proceedings may be initiated on the basis of a complaint or by the OGAI of its own volition. The rules require the OGAI to issue a notice containing particulars of non-compliance, and to provide the online game service provider with an opportunity to be heard prior to determining whether an inquiry must be carried out. If the OGAI believes there are grounds for holding an inquiry notwithstanding such submissions, it may proceed with the inquiry, and hear and decide the complaint within 90 days. It may thereafter impose penalties, suspend or cancel registration certificates, and issue such orders of prohibition. 55 While determining the quantum of penalties, the OGAI is required to take into account factors such as the amount of loss caused, repetitive nature of non-compliance, and gravity of the offence, amongst others. 56 Blocking The Act further provides that in case of violation of its provisions, any information generated, transmitted, received, or hosted in connection with online real money gaming may be blocked from access. 57 This blocking power applies notwithstanding Section 69-A of the Information Technology Act, 2000 (“IT Act”), effectively creating a standalone mechanism for restricting such content. Platforms that host this material may therefore be subject to blocking orders issued under the Act.
The Act also prohibits “aiding, abetting, inducing or otherwise indulging or engaging in offering” online money games and online gaming services. 50 This offence is punishable by imprisonment of up to three years, or with a fine of up to INR 1 crore (approximately US$113,000), 51 or both. This expansive language potentially reaches the entire gaming ecosystem: app stores, payment processors, advertisement and investors. The scope of aiding and abetting is unclear under the Act in terms of what nature of services offered to online money gaming services may amount to aiding and abetting. Service providers and investors to the online money gaming companies must evaluate their potential liability under these prohibitions. Grievance redressal system: The Draft Rules seek to establish a three-tiered user complaint mechanism for registered online game service providers offering registered social games and e-sports. The first tier is the online game service provider’s own internal grievance redressal mechanism, the second tier is the Grievance Appellate Committees (GACs) 52 constituted under the IT Rules, and the third tier the OGAI. Given the broad nature of the definition of ‘grievance,’ it may include service-related complaints, unfair practices, amongst others. Industry concerns have been raised in relation to limiting the grievance redressal mechanism to only registered service providers, and the composition of the GACs not comprising persons with domain expertise required to address gaming industry concerns. Adjudication and penalties The Act imposes penalties for failure to comply with directions and orders issued by the Central Government, or the OGAI of
Closing reflections on the new regime As India’s real money skill gaming industry reels from the
50 Section 5, Act 51 Section 9(2), Act 52 Draft Rules, Rule 23; Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021, Rule 3A 53 Section 12 54 Rule 23(8), Draft Rules 55 Rule 21, Draft Rules 56 Rule 21(9), Draft Rules 57 Section 14, Act
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IMGL MAGAZINE | DECEMBER 2025
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