With legal provisions around celebrity endorsement of online betting still hazy, apps rake in the moolah while legal experts and activists demand responsible behaviour from celebrities
Illustration/Uday Mohite
The thin line between the legal and illegal when it comes to celebrities promoting betting apps has raised eyebrows even as the Enforcement Directorate conducts its investigation into the Mahadev Book betting app. The central agency’s probe made a splash earlier this month, when Bollywood heavyweights like Ranbir Kapoor, Shraddha Kapoor, Kapil Sharma, Hina Khan and Huma Qureshi were summoned for inquiries.
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Further, the ED has 60 apps linked to Mahadev Book under its scanner, with names like Sanjay Dutt, Nawazuddin Siddiqui, Sonakshi Sinha, Tamannaah Bhatia, Urvashi Rautela, Farah Khan, Suniel Shetty, Neil Nitin Mukesh, Sunny Leone, Neha Sharma, Kajal Agarwal, Badshah, Jacquline Fernandes, Kriti Kharbanda, Adah Sharma, Raftaar and Krushna Abhishek promoting them.
Even Shah Rukh Khan found himself mired in controversy, after a Non Government Organisation called Untouched India Foundation held a protest outside his house. The NGO was voicing its displeasure at Khan endorsing A23, an online rummy portal.
(From left to right) Krishnchandra Adal; Abha Singh; Ali Kaashif Khan Deshmukh; Sujay Kantawala
“Such games are not legally permitted in India, and yet these platforms exploit the grey areas within the Public Gambling Act of 1867. Now, global players entering the market through partnerships with local companies or by acquiring Indian game studios that create culturally tailored games. Indian celebrities are promoting online gaming through enticing but misleading advertisements. Some even endorse surrogate websites for illicit offshore gaming organizations, which are prohibited by the Indian government,” says Krishnchandra Adal, who heads Untouched India. Adal is currently drafting a Public Interest Litigation (PIL) to be filed in the Supreme Court in this regard.
“Betting on games primarily determined by skill was legalised by the Supreme Court of India in a 1967 decision, which was subsequently upheld in 1996. However, wagering on games where chance is the dominant factor remains prohibited. In 1968, rummy was legalised with the argument that it predominantly involves skill, despite the presence of some element of chance. Online gaming companies are citing these precedents to promote the legality of skill-based online games,” Adal says.
He adds that even when regulations to govern the internet were absent, such promotion and endorsement by celebrities was irresponsible due to the adverse socio-economic consequences of online gambling. Despite the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Amendment Rules of 2023 being in effect, games offered by gaming companies have not yet been classified as permissible.
During the research for his PIL, Adal came across a study by Dheeraj Sharma, Director Professor at Indian Institute of Management (IIM) Rohtak, who, through a survey, found that young people are more likely to turn to gambling if a famous person supports it. The more attractive or well known the celebrity, the higher the chances of this happening. At the same time, if the same celebrity issues the statutory warning about the dangers of gambling addiction, the chances of someone taking up gambling drop to roughly 50 per cent.
Advocate Ali Kaashif Khan Deshmukh says that the Consumer Protection Act 2019 has brought celebrities under the legal microscope for their role in promoting potentially misleading products and services. “While specific guidelines for online gaming endorsers are still absent, the message is clear: celebrities can no longer evade accountability,” he says.
Senior lawyer Abha Singh cites the example of the Amrapali housing society in Noida, which was endorsed by former Indian cricket team captain Mahendra Singh Dhoni. Numerous people invested in it and later lost their money. “In a situation where the credibility of builders is questionable, people were enticed solely because Dhoni was endorsing the project and, as a result, they were deceived. There must be a concept of moral accountability because these individuals are public figures,” says Singh.
She adds that celebrities are often paid substantial sums for endorsements, and sometimes these apps offer big money despite their illegality. “In such cases, the police do have the option to name them as accused,” Singh says. “What the Enforcement Directorate (ED) is currently investigating is a part of money laundering, to establish how various channels are used to siphon the proceeds of illegal activities,” she further elaborates. The concerns are not just based on hypothetical results. The widespread impact of online gambling and betting apps in India has actually led to multiple instances of individuals ending their own lives after incurring substantial losses.
In June, a 55-year-old man died by suicide in Panvel after losing '5 lakh in the game “Junglee Rummy”. Police investigations revealed that the man, driven by addiction, resorted to taking loans in an attempt to recover his losses, only to face further setbacks. Similarly, a 50-year-old businessman from Pune took the extreme step after sustaining massive losses in online casino games. The police have registered an abetment to suicide case in connection with the incident.
Similar instances have been reported from other parts of Maharashtra, as well as Gujarat, Kerala, Chennai, and Karnataka. “The consumer is most often treated as a Guinea pig who will be used and also manipulated by huge corporations to sell their goods or services. It’s smart planning, mastered over decades by skilled management experts. The consumer is to be captivated by visual appeal of lovely faces coupled with terrific music, and the message to buy the product is drilled into the psyche,” says senior lawyer Sujay Kantawala. Dream11, a popular fantasy cricket game, has also faced a spate of PILs in the past, but the Supreme Court has ruled the it is game of skill and not chance.
Today, Dream11’s website prominently states, “In August 2021, the Supreme Court of India affirmed that fantasy sports involve a significant degree of skill and judgment, rendering them legal. The success of fantasy games hinges on a user’s knowledge, attentiveness, and strategic execution. Consequently, achievements in fantasy cricket are not subject to chance. As a result, Dream11 qualifies as a legitimate business in India and falls outside the scope of the Public Gambling Act, 1867. According to the Federation of Indian Fantasy Sports (FIFS), the nation’s inaugural self-regulatory body for the Sports Gaming industry, games of skill are exempted from the purview of most gambling regulations and are thus considered legal to participate in.” The Advertising Standards Council of India (ASCI) has also issued various guidelines for advertising featuring celebrities. However, these guidelines are voluntary.
Legal experts say that online games typically fall under two categories, games of chance and games of skill. In a significant 1996 ruling, the Supreme Court defined a game of chance as one primarily determined by luck or entirely reliant on random outcomes. Activities like rolling dice, spinning wheels, and card shuffling fall into this category, where the final result remains uncertain and unpredictable until the dice settles, the wheel comes to a stop, or the dealer finishes distributing the cards. Conversely, a game of skill, while not entirely devoid of chance, primarily hinges on the player’s superior knowledge, training, attention, experience, and dexterity. Sports such as golf, chess, and even games like Rummy are often classified as games of skill.
The Public Gambling Act deems any form of gambling for money illegal. However, it makes an exception for games of skill, which are considered lawful. Section 12 of The Public Gambling Act, 1867 say’s that Act not to apply to certain games-Nothing in the foregoing provisions of this Act contained shall be held to apply to any game of mere skill wherever played.
“In the realm of online betting and gambling, the legal landscape in India is as intriguing as a game of chance itself. Imagine this: no federal bans, only a handful of states displaying their legal stances, and a constant debate between skill-based and luck-based games,” says Deshmukh. Certain states, such as Nagaland, Sikkim, and Kerala, have embraced regulated online gaming apps, where skill takes precedence. They even mandate licenses for these virtual gaming platforms. However, states like Telangana, Rajasthan, Uttar Pradesh, Andhra Pradesh, and Tamil Nadu remain steadfast in prohibiting such activities within their jurisdictions.
The ED’s ongoing investigation into Mahadev Book indicates that Saurabh Chandrakar, the alleged mastermind behind the app, along with his associates Ravi Utpal, Kapil Chellani, and Satish Kumar, currently residing in Dubai, are known to operate nearly 60 illegal offshore gambling websites. Multiple cases related to fraud and illegal activities have been filed against him. The apps offer a range of betting activities, centered around games like cricket, football, tennis, horse racing, greyhound racing, kabaddi, a host of card games and in some cases, even political events in India.
“Many of these apps operate from outside India, and these individuals are well-versed in Indian law. They utilise the Internet, often with the support of celebrity endorsements, to attract Indian customers and generate profits. We must consider amending our laws to align with the current situation, allowing law enforcement to take effective action,” a senior law enforcement official tells mid-day.
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