The Online Money Gaming Act, 2025: Constitutional Challenges and Enforcement Gaps

Aftab Singh

The Online Money Gaming Act, 2025 has fundamentally altered India’s digital entertainment and gaming landscape. With a sweeping prohibition on all “online money games”, whether of skill, or of chance, or a mix, the Act collapses a decade of jurisprudence that distinguished skill-based formats like fantasy sports and rummy from gambling. Overnight, a multi-billion-dollar industry has been criminalized, raising serious constitutional and practical concerns. The government’s justification extends beyond morality to sovereignty and administrative uniformity. It points to manipulative algorithms, aggressive advertising, and offshore operators exploiting regulatory loopholes as reasons why regulation was no longer enough, and prohibition was the only viable safeguard. On paper, this seems like administrative necessity but in reality, it obliterates an industry that had judicial legitimacy and pits innovation-driven growth against paternalism that undercuts consumer autonomy and investor confidence alike.

Constitutional Violations - The Act’s provisions raise challenges under Articles 14, 19(1)(g), and 21 of the Constitution of India, as well as the principles of federalism, proportionality, and legitimate expectation.

• Federalism and Legislative Competence - “Betting and gambling” fall under Entry 34, List II (State List). By prohibiting all online money games through Section 5, Parliament overrides licensing regimes in Nagaland, Sikkim, and Meghalaya, encroaching upon state legislative competence. The Supreme Court in State of West Bengal v. Kesoram Industries Ltd.  had held that legislative entities must be respected and encroachment cannot be justified by broad interpretation of Union powers. We would moot that this ‘centralization’ may be justified by invoking national security, cyber fraud, and inter-state consistency, but such reasoning sets a dangerous precedent.

  
  

• Article 14 – Equality before Law - Section 2(g) of the Act defines 'online money games' to include games of skill, games of chance, or a mix, and Section 5 prohibits them outright. This conflates categories distinguished by the Supreme Court in K.R. Lakshmanan v. State of Tamil Nadu  and State of Andhra Pradesh v. K. Satyanarayana , where rummy was held to involve substantial skill. Such conflation fails the test of intelligible differentia and rational nexus under Article 14. Two categories with fundamentally different natures collapsed into one, and the State has not demonstrated a rational nexus between this classification and its stated goal of protecting public order and health. Rational policymaking requires consistency, yet the Act demonstrates selective morality rather than uniform principle, as is also reflected in Section 6, which overlooks the flagrant promotion of tobacco, liquor, casino et al., which substance or activity falls well within the ambit of ‘addiction’. Even within the realm of gaming, the law’s classification lacks coherence. Offline games of chance such as horse racing remain lawful in states that choose to regulate them, yet online equivalents are criminalized under Section 5. Regulation of addictive features could have achieved the objective, while respecting settled judicial lines.

  
  

• Article 19(1)(g) – Freedom of Trade and Profession - Running skill-based gaming platforms constitutes a legitimate business. Section 5 of the Act extinguishes this right by criminalizing the industry. It is trite law that economic activity cannot be extinguished without proportional justification. Clearly, the Act imposes disproportionate and unreasonable restrictions, violating Article 19(1)(g) of the Constitution.

  
  

• Article 21 – Right to Life, Liberty, and Autonomy - By denying adults the freedom to participate in skill-based online games, the Act undermines autonomy and dignity. In K.S. Puttaswamy v. Union of India , the Court recognized autonomy as central to the right to privacy and dignity. By treating all consumers as potential addicts, the law infantilizes citizens and denies them dignity, which the Court has consistently recognized as part of Article 21. At its core, the Act undermines individual autonomy protected under Article 21.

  
  

• Doctrine of Proportionality - The absolute prohibition in the 2025 Act fails the necessity and balance prongs, as consumer harms could have been addressed through deposit caps, algorithm audits, and self-exclusion registers instead of prohibition. In Modern Dental College v. State of Madhya Pradesh,  the Supreme Court reaffirmed proportionality as the standard for restrictions on fundamental rights.

  
  

• Legitimate Expectation - Was MeitY wrong in recognizing permissible real-money games with safeguards, by amending the Rules in 2023? The abrupt reversal by way of the 2025 Act undermines this expectation, causing massive losses to investors and operators who had relied on prior commitments. For an economy that relies on credibility to attract capital, this unpredictability is deeply damaging.

Implementation and Enforcement Challenges - Even if constitutionally upheld, the Act faces serious enforcement and implementation hurdles, particularly against offshore operators.

• Extraterritorial Enforcement - Section 1(2) extends the Act to operators outside India. However, enforcement against offshore entities is challenging due to jurisdictional limits. Mutual Legal Assistance Treaties (MLATs) and Letters Rogatory are slow processes, limiting India’s ability to secure data or prosecute foreign operators.

  
  

• Blocking Orders and App Distribution - Blocking under Section 69A of the IT Act is a primary enforcement tool. Yet, mirror sites, VPNs, and sideloaded applications make domain and app-blocking easily circumvented. While app stores may comply, alternate distribution channels reduce the efficacy of such measures.

  
  

• Payment Interdiction - Section 7 mandates blocking financial transactions for online money games. However, users and operators can bypass restrictions through cryptocurrency, prepaid vouchers, and offshore wallets. This requires coordination between MeitY, RBI, NPCI, and FIU-IND, making enforcement complex and resource-intensive.

  
  

• Advertising and Surrogate Promotion - Section 6 bans advertisements, but surrogate promotions through influencers, e-sports sponsorships, and NFTs remain hard to monitor. Social media platforms operating across jurisdictions pose an added enforcement challenge.

  
  

• Coordination Across Regulators - Multiple agencies including MeitY, DoT, RBI, FIU, SEBI, and state police, shares overlapping jurisdiction. Without a nodal agency and clear standard operating procedures, enforcement risks fragmentation and apparent inefficiency.

  
  

• Consumer Migration to Illegal Platforms - As seen with gambling prohibition historically, demand shifts underground. Consumers are likely to migrate to unregulated offshore platforms, which lack KYC, grievance redressal, or responsible gaming safeguards. This undermines the Act’s stated goal of consumer protection.

The Promotion and Regulation of Online Gaming Act, 2025 is constitutionally vulnerable under Articles 14, 19(1)(g), and 21, and raises federalism concerns. It also faces severe enforcement challenges, particularly against offshore operators and in monitoring payments and advertising. While the intent to curb addiction and fraud is legitimate, blanket (and quite unreasonable) prohibition fails the test of proportionality and undermines legitimate business, consumer autonomy, and state revenues. Judicial review is inevitable, and a calibrated regulatory framework remains the more sustainable policy path.