Now, Three Courts Deny Appeals To Stop Gaming Law

(MENAFN- Live Mint) New Delhi: A two-judge bench at the Madhya Pradesh High Court on Tuesday denied an appeal seeking an injunction against the Union government notifying and enforcing the law that last month banned any online games involving financial transactions in India. The Jabalpur court became the third after Karnataka and Delhi to reject attempts by the industry to procure an injunction against the law, before it is notified by the Centre.

Represented by a relatively unknown Clubboom11 Sports & Entertainment-a Gwalior, Madhya Pradesh-based online gaming company registered two years ago-the submission argued“constitutional infirmity” in the Centre's Promotion and Regulation of Online Gaming Act, 2025. Gopal Jain, a senior counsel who appeared for the company on behalf of the $23-billion money gaming industry, claimed that fantasy sports was a“constitutionally protected activity.” The lawyer also cited the 2023 amendment to Information Technology (Intermediary Guidelines and Digital Media Ethics Code), 2021, to state that the Centre itself had previously regulated the space as a legal entity.

The two-judge Madhya Pradesh HC bench, helmed by chief justice Sanjeev Sachdeva, rejected the plea for relief filed on 29 August.

Also Read | How India's gaming ban triggered a job bloodbath

Further, Tushar Mehta, solicitor general of India and the representative for the Centre, submitted that other appeals against the law at the Karnataka and Delhi high courts should be clubbed together and brought to the Supreme Court-instead of being heard individually.

On Tuesday, a Delhi High Court hearing was filed against the Centre by Bagheera Carrom OPC Pvt. Ltd also received a similar response. Mehta told the court that the Centre is in the process of notifying the law. Once it is notified, the ministry of electronics and IT (Meity) will establish an 'authority' to promote esports and casual games that do not involve money, and also enforce rules to implement the law on the ground.

Prior to this, on 30 August, a single-judge bench at the Karnataka High Court declined to issue a stay against the notification of the Act in question. The Centre is expected to file its response to offering interim relief to the online money gaming industry by Monday-which included the industry's appeal for a one-week prior notice before the law is notified and enforced. Mehta opposed strong opposition against the appeal, and the second hearing will be conducted next Monday.

Also Read | Online gaming ban: Karnataka HC to hear first challenge against new law

The various court battles come as the Centre, in a space of five days, received Cabinet approval and passed a law that prohibited the operation of any game that involved money transactions in the country. Union IT minister Ashwini Vaishnaw said across multiple forums that the Centre's decision came after many years and thousands of documents collated on how addiction and money laundering were promoted through games such as Dream11, RummyCulture, My11Circle, Mobile Premier League and the like.

Since then, the industry has experienced multiple layoffs. Games24x7, MPL and Baazi Games have announced layoffs internally, while others are expected to follow through soon. Industry bodies representing the companies wrote in an appeal to Union home minister Amit Shah on 19 August-the day the law received Cabinet approval-that a blanket ban on the sector would lead to the loss of over 200,000 jobs across over 400 companies.

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The Centre, however, has held firm on the law. On 23 August, S. Krishnan, secretary at Meity, toldMintin an interview that the Centre“followed all constitutional requirements to frame the law, and was ready for any legal challenges that are mounted against it.”

Before the ban, the money gaming industry faced serious cases of goods and services taxes (GST) on the sector, with demands from the Centre exceeding $23 billion. Hearings on the same were concluded on 12 August, but now stand only to compound the misery of a sector that has been asked by the Centre to pivot in accordance with the law, doing which it stands to lose nearly 95% of its revenue stream.

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