2021 is going swimmingly well for India’s online gaming business, leaving behind the market share of top European and Asian countries. Clocking a total of 560 million users, India is also the second-largest internet user in the world.

Currently valued at $930 million, the Indian gaming industry as a whole is the most valuable gaming market in the world. This makes India’s online gaming sector not just the fastest-growing but the largest across the world. The number of online gaming businesses has also increased significantly.

Indian laws divide games into two categories i.e., a “game of skill” and a “game of chance.” A game of chance is prohibited in the country except in certain states that require a license. The difference between a game of skill and a game of chance is thin and is dealt with by the Supreme Court as follows:

Gambling in a nut-shell is payment of a price for a chance to win a prize. Games may be of chance, or of skill or of skill and chance combined. A game of chance is determined entirely or in part by lot or mere luck. The throw of the dice, the turning of the wheel, the shuffling of the cards, are all modes of chance. In these games the result is wholly uncertain and doubtful. No human mind knows or can know what it will be until the dice is thrown, the wheel stops its revolution or the dealer has dealt with the cards. A game of skill, on the other hand – although the element of chance necessarily cannot be entirely eliminated – is one in which success depends principally upon the superior knowledge, training, attention, experience and adroitness of the player.

Dr. K.R. Lakshmanan vs State Of Tamil Nadu And Anr 1996 AIR 1153

Roulette is a wheel game in which a ball is dropped onto a revolving wheel with numbered compartments, the players betting on the number at which the ball comes to rest, or on various groupings of numbers, the colour red or black, whether the number is odd or even, or if the numbers are high (19–36) or low (1–18). Roulette where the result depends on the turning of the wheel, the result is wholly uncertain and the game is classified as a game of chance.

Also read: Is it legal to play fantasy sports like Dream11 for real money in India?

In India (except the states of Sikkim and Nagaland), there is no dedicated legislation that governs online gaming. Entities offering any game of skill have to comply with the gaming legislation – the Public Gambling Act, 1867 or similar laws adopted by various states. These laws prohibit any game of chance. Roulette is considered a game of chance and is prohibited across the country under the prevailing gaming laws.

Winzo Games is one of the countries largest vernacular gaming platforms offering several games on its platform in regional languages. Recently, Winzo started offering a game under the name “Spin Science” where players are required to predict the number in which the ball may stop. Points are awarded based on where the ball stops in a revolving wheel.

If a player predicts exactly, he is awarded the highest points. Points are awarded to two numbers on either side of your chosen number i.e. if a player chooses 7, he will be awarded points if the ball stops at 5, 6, 7, 8, 9 with highest points for 7 and lowest points for 5 and 9.

Now the game offered by Winzo appears to be seemingly similar to the game of roulette, the only difference being method of awarding points and the total numbers. The total numbers are 16 in the game offered by Winzo while in an actual roulette the numbers are 36.

To qualify as a game of skill, the only issue that needs to be considered is whether there is a “substantial degree of skill” required for playing roulette or a similar game. It is universally accepted that roulette is not a game involving a “substantial degree of skill” and hence is included in the ambit of gambling.

The “How to play” terms of the Winzo game appearing at the beginning of the game say the exact stoppage can be predicted based on the rotation of the ball and the speed of the ball. It is not clear how these minor modifications can make a roulette like-game a game of skill. Even in a physical roulette, an argument can be made that ball stoppage is estimated by observing the speed of the ball.

Can the same principles be applied to a physical roulette to make it a skill game?

We have approached Winzo founders seeking their comments to understand how the game qualifies as a skill game. The founders have refused to comment.

Winzo is a member of the self-regulatory body All India Gaming Federation (AIGF) whose charter prevents members from offering any game of chance. We have approached AIGF for its comment on the game offered by Winzo. We have not received any comments at the time of writing this. This post will be updated once we receive any comment from the founders and/or the AIGF.

Online gaming as said earlier is unregulated largely and the companies are seemingly pushing the envelope by offering games that are not judicially held to be games of skill. This is one such example.

Internet is complex and is difficult to regulate and sometimes violations go under the radar. A similar argument was taken by the Tamil Nadu government in its special leave petition challenging the recent Madras High Court judgement:

………………..a ban on wagering and betting in cyberspace was the least restrictive measure available to the Petitioner in the context of the unique and unprecedented complexity of regulating, any activity that takes place over the internet and frequently from locales beyond the territorial jurisdiction of the Petitioner State.

States like Telangana, Andhra Pradesh, and Karnataka in recent times have enacted laws concerning online gaming which are under challenge before respective high courts. Odisha is another state where all forms of gaming for stakes are prohibited. The social gaming platform and its directors have recently filed a writ petition challenging the Odisha gaming law.

Gaming legislations across the States prescribe penalties that are more or less similar for allowing games of skill in violation of the prevailing enactments. If the game offered by Winzo as “Spin Science” does not qualify as a skill game, which is most most likely the case, it may attract penalties and punishments on the company and the directors.

For example, the Bombay Prevention of Gambling Act, 1887 imposes a fine and imprisonment for offenders. A first offence is punishable with a fine of at least INR 500 (approximately USD 8) and 3 months’ imprisonment, a second offence is punishable with a fine of at least INR 1,000 (approximately USD 15-20) and imprisonment for 6 months. and a third or subsequent offence entails a fine of at least INR 2,000 (approximately USD 30-35) and imprisonment for one year.

In July 2021, WinZO has raised $65 million in a Series C funding round, led by California-based Griffin Gaming Partners, taking the total tally of capital raised by the company to $90 million. The social gaming platform has recently set up a $20 million fund for the Indian game developer ecosystem.