Gaming
From Valsad to SC: Justice Pardiwala holds fate of $3 billion gaming industry, 2 lakh jobs
EXCLUSIVE: “Blanket ban arbitrary and unconstitutional,” Head Digital Works tells Karnataka HC
Head Digital Works in its 396 page petition (a copy of which is with Storyboard18) contends that the Act violates several fundamental rights under the Constitution
The petition cites earlier court rulings, including judgments of the Madras, Kerala, and Karnataka High Courts, which struck down similar blanket bans imposed by state governments on online skill gaming.
Head Digital Works, operator of online gaming platform A23, has approached the Karnataka High Court seeking to strike down provisions of the newly enacted Promotion and Regulation of Online Gaming Act, 2025. In its writ petition, the company argues that Sections 2(1)(g), 5, 6, 7 and 9 of the Act—which criminalize online money games including rummy and poker—are unconstitutional, arbitrary, and violative of fundamental rights under Articles 14, 19 and 21 of the Constitution.
The company has urged the court to declare these provisions invalid to the extent they apply to games of skill, contending that Parliament lacked the legislative competence to impose a blanket prohibition.
The company argues that the legislation, which was introduced and passed in Parliament within two days without public consultation or debate, has brought the ₹23,440 crore online skill gaming industry to a standstill. According to the petition, the law threatens the jobs of over two lakh employees in the sector, disrupts foreign and domestic investment, and undermines India’s position as one of the world’s fastest-growing gaming markets.
Constitutional Grounds of Challenge
Head Digital Works in its 396 page petition (a copy of which is with Storyboard18) contends that the Act violates several fundamental rights under the Constitution, including:
Article 19(1)(g): Right to practice any trade or business. The company emphasized that the Supreme Court and multiple High Courts have consistently held that games of skill, even when played for stakes, are a legitimate business activity and not gambling.
Article 14: Equality before law. The Act, the petition states, is “manifestly arbitrary” as it treats legitimate domestic operators on par with illegal offshore betting platforms.
Articles 19(1)(a) and 21: Freedom of expression and right to livelihood, which the company claims are directly curtailed by the sudden prohibition.
The petition cites earlier court rulings, including judgments of the Madras, Kerala, and Karnataka High Courts, which struck down similar blanket bans imposed by state governments on online skill gaming. Appeals in these cases are currently reserved before the Supreme Court.
Impact on Industry and Employment
Head Digital Works, which operates the popular gaming platform A23, said it employs 606 individuals directly and contributes significantly to the exchequer. Since inception, it claims to have paid over ₹1,643 crore in GST and nearly ₹96 crore in service tax before GST was implemented. In FY 2024–25 alone, the company paid ₹687 crore in GST.
The petition highlights that the broader online gaming sector contributes ₹6,500–6,800 crore in direct taxes and around ₹75,000 crore in indirect taxes annually, while generating employment for two lakh people.
Alleged Lack of Due Process
The company expressed concern that the Act was introduced without public consultation or stakeholder engagement, despite years of dialogue between the Ministry of Electronics and Information Technology (MeitY) and the industry. Earlier amendments to the IT Rules, 2021, had already created a framework for regulating online gaming through self-regulatory bodies, but these provisions were never operationalized.
“It is astonishing that after encouraging the sector through initiatives like the Shillong Centre of Excellence in Online Gaming and the Bharat Tech Triumph Program, the Union Government has now overnight criminalized the very industry it supported,” the petition notes.
Industry’s Safeguards and Self-Regulation
The petition also underscores that operators like A23 have adopted responsible gaming practices, including mandatory KYC verification, age restrictions (18+ only), deposit limits, self-exclusion options, and certified random number generator (RNG) technology to ensure fair play. Independent audits, including certifications from iTech Labs and Gaming Laboratories International, have validated the absence of bots or manipulation in their platforms.
Broader Concerns
Industry observers warn that the ban could backfire by pushing players towards illegal offshore betting platforms, undermining consumer protection and national security—the very concerns the Act claims to address. Reports following the ban already show a surge in offshore betting advertisements and dubious celebrity endorsements.
Head Digital Works’ petition urges the High Court to strike down key provisions of the Act, particularly those criminalizing online skill games, on grounds of unconstitutionality, arbitrariness, and disproportionate restrictions.
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