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The next BIG thing to hit the online gaming world is Fantasy Sportswhich has already taken the western world by storm that not only indulges one’s love for sports, but also challenges their skills and prove highly rewarding at the same time.
India too has a high appetite for sports, as can be evidenced by the mania for cricket. Our country is divided by amazing contrasts of religion, culture, habits, cuisine, languages and status, if there is one thing that unites all with a force stronger than superglue, it has to be Cricket!
There is a vast Indian public that is yet to experience the joy of Fantasy Sports but a few Fantasy Sport platforms have already caught on in a big way in India, with numerous sites dedicated to team sports, mostly cricket. One of the key players which has established itself in the market is LeagueGuru – backed by PokerGuru and is the fastest growing fantasy sports site in the country.
A fantasy sport is a game where users select the players to form a virtual team, competing in real live matches. The virtual team created by the user, scores points based on the performance of the players in their team. At the end of the live match, the aggregate scores of the virtual team is compared with fellow users’ virtual team scores and the player whose team scores the most points is declared the winner.
Fantasy sports is not related to sports betting or gambling in any manner, since no user picks one team, but rather users/sports fans need to use their skill and sports knowledge to choose individual players, to build the highest scoring team.
Playing fantasy games online requires considerable skill, judgment and discretion, the Punjab and Haryana High Court observed and recognized that such games can't be considered gambling. In an order dated 18th April, 2017, the HC has ruled that playing fantasy sports online does not amount to gambling and involves a substantial degree of skill.
The ruling was made by a single judge bench of Justice Amit Rawal while hearing a petition filed by Advocate Varun Gumber and was reported in The Times of India.
The petitioner, Gumber, claimed that he deposited ₹50,000/- on a fantasy sports website named Dream11 and lost the money after playing with his fantasy teams in two matches. He further wanted the court to direct investigation under the Public Gambling Act, 1867 against Dream11 for promoting gambling.
He created a virtual team for a cricket match between Ireland and Afghanistan by choosing 11 players. The petitioner submitted that at the end of the match, he lost ₹24,000, which he had bet on his virtual team while playing in various leagues.
On March 11, the petitioner created another virtual team, this time for a football match played between Manchester City and Middleborough and bet ₹26,000 on his team. Again, he ended up losing the amount.
According to Gumbal, the nature of the activity on the website was not based on skill and was purely a game of chance, amounting to gambling which is prohibited under law.
Denying the allegations, the company contested the petition claiming that they are registered with the ministry of commerce and being assessed by the income tax department.
The court rejected the petitioner’s contentions and held that a great deal of user’s knowledge, adroitness, judgment and discretion is required to creating his/her own league team. The court also stated that the user had to continuously monitor the sporting event, statistical performance of the player and previous track record, weather conditions etc.
Justice Rawal in his order examined Dream11’s terms and conditions, game rules and the formats while noting that substantial skill, efforts and statistics are required to track the performance of players and also quoted the Supreme Court judgment by Dr. KR Lakshmanan v. State of Tamil Nadu which held horse racing and betting or wagering on it to be a game of skill. He noted that the judgment squarely applies in the present case of fantasy sports also.
The court also held that the company operating Dream11 has been regularly paying service tax and income tax and is a duly registered incorporated entity with the registrar of companies and none of these authorities have found anything amiss in its business model.
Importantly, the court also noted that since fantasy sports is not gambling, it is a business activity that is afforded the protection of right to free trade and commerce guaranteed under Article 19(1)(g) of the Constitution.
This order of the Punjab and Haryana High Court assumes much more significance as it is the first order ever by an Indian High Court on the legality of fantasy sports and the element of skill involved in online fantasy games. The order should considerably boost the fantasy sports industry, which has been reiterating the position that it is a skill-based game and is outside the ambit of gambling.