Judgment :- W.P.(C).14495/2005: The first petitioner is the State of Sikkim. The second petitioner is a Company, registered under the Companies Act. It is the marketing agent of the online lotteries of the first petitioner. The third petitioner is a registered partnership firm, appointed as the distributor of online lottery tickets, by the second petitioner. They have approached this Court, mainly challenging Ext.P11 notification dated 22.4.2005 issued by the Kerala Government, prohibiting the sale of computerized and online lottery tickets, organized, conducted or promoted by all State Governments in the Kerala State and permitting the sale of paper lotteries, organized, conducted or promoted by various State Governments, including the Kerala Government. The brief facts of the case are the following: 2. The organizing of lotteries by State Governments is regulated by the provisions of the Lotteries (Regulation) Act, 1998. The State of Sikkim has issued Ext.P12 Sikkim On-line Network Lottery Rules, 2001 for organizing, conducting and promoting online lotteries. The second petitioner, the sole marketing agent of the first petitioner, has established computer terminals throughout the territory of India, except in lottery free zone States, for the sale of online lottery tickets. It has established more than 900 such terminals in the State of Kerala. While so, the Government of Kerala issued the Kerala State Lotteries and Online Lotteries (Regulation) Rules, 2003. In purported exercise of the powers under the said Rules, when the Director of Lotteries of the State of Kerala and the officers under him, started interfering with the running of lotteries by the 1st petitioner in the State, petitioners 1 and 2 approached this Court, challenging the offending provisions in the said Rules. A learned single Judge of this Court upheld the validity of the Rules. But, the Division Bench of this Court, by Ext.P1 order dated 19.12.2003, stayed the impugned provisions of the Rules. Finally, the Writ Appeal was dismissed, vacating the said interim order. But, the Apex Court entertained the S.L.P. against the judgment of the Division Bench. By Ext.P3 order dated 17.5.2004, the Apex Court restored Ext.P1 interim order of the Division Bench. While so, this Court, by Ext.P4 judgment, held that if any lottery is run in violation of Section 4 of the Lotteries (Regulation) Act, the police can prosecute the offenders, as any violation of Section 4 is a cognizable offence. By Ext.P3 order dated 17.5.2004, the Apex Court restored Ext.P1 interim order of the Division Bench. While so, this Court, by Ext.P4 judgment, held that if any lottery is run in violation of Section 4 of the Lotteries (Regulation) Act, the police can prosecute the offenders, as any violation of Section 4 is a cognizable offence. The Writ Appeals filed against the said judgment are pending before the Division Bench of this Court. The first petitioner herein has challenged Ext.P4 judgment directly before the Hon’ble Supreme Court and the Apex Court has admitted the S.L.P. and by Ext.P6 dated 6.9.2004, ordered that Ext.P1 interim order of the Division Bench will remain in force. The petitioners pointed out that subsequently Ext.P4 judgment was stayed by the Apex Court. While so, contempt proceedings were initiated against the officers of the State of Kerala for the violation of the interim orders of the Apex Court and in the said proceedings, the respondents apologized and undertook to withdraw all prosecutions. Subsequently, the Government by S.R.O.33/2005 dated 13.1.2005, issued Ext.P10 amendment to the Kerala State Lotteries and On-line Lotteries (regulation) Rules, 2003 and vide S.R.O.No.34/2005 dated 13.1.2005, prohibited the sale of all computerized and online lottery tickets in the State of Kerala. The relevant Government orders publishing them are G.O.(P).No.3/2005/TD dated 13.1.2005 and G.O.(P).No.4/2005/TD dated 13.1.2005. They were followed by S.R.O.No.73/2005 dated 27.1.2005, prohibiting the sale of all lotteries in the State of Kerala and declaring the State a lottery free zone. Simultaneously, the Government repealed the Kerala State Lotteries and Online Lotteries (Regulation) Rules, 2003. The said combined notification published as per G.O.(P).No.11/2005/TD dated 27.1.2005 is produced as Ext.P13 in the writ petition. Subsequently, the Government published S.R.O.No.382/2005 dated 22.4.2005, as per G.O.(P).No.68/2005/TD dated 22.4.2005 (Ext.P11), lifting the ban, concerning the sale of paper lotteries and continuing the ban on the sale of computerized and online lottery tickets organized, conducted or promoted by all State Governments. By the said notification, Kerala has been declared to be an online lottery free zone. This Writ Petition is filed, challenging Exts.P10 and P11 and seeking consequential reliefs. 3. Ext.P10 is no longer in force, in view of Ext.P13. At the time of hearing, the challenge against Ext.P11 alone was canvassed and that too, to the extent it prohibits computerized online lotteries. This Writ Petition is filed, challenging Exts.P10 and P11 and seeking consequential reliefs. 3. Ext.P10 is no longer in force, in view of Ext.P13. At the time of hearing, the challenge against Ext.P11 alone was canvassed and that too, to the extent it prohibits computerized online lotteries. According to the petitioners, the State has no jurisdiction to issue a notification in the nature of Ext.P11. The State may declare that Kerala is a lottery free zone and prohibit the sale of all lotteries including online lotteries, in the State of Kerala. But, it cannot prohibit the sale of tickets of online lotteries alone. The same will offend the provisions of Section 5 of the Lotteries (Regulation) Act, as interpreted by the Apex Court, it is submitted. 4. A detailed counter affidavit has been filed on behalf of respondents 1 and 2, resisting the prayers in the writ petition. They have raised a preliminary objection, stating that the writ petition is not maintainable under Article 226 of the Constitution of India. The dispute raised by the State of Sikkim in this Writ Petition is a matter, which has to be raised before the Apex Court under Article 131 of the Constitution. Petitioners 2 and 3, being agents of the first petitioner, do not have any independent right than those enjoyed by the first petitioner. So, if the first petitioner has no locus standi to maintain this Writ Petition, it is submitted, petitioners 2 and 3 also cannot maintain this Writ Petition. In support of this submission, respondents 1 and 2 relied on the decision of the Division Bench of the Karnataka High Court, which is produced as Ext.R1(b). The State of Karnataka has issued a notification, similar to Ext.P11 and the challenge to the same made by the concerned State Governments and their agents was repelled by the Karnataka High Court, by the said judgment. 5. Respondents 2 and 3 also allege that online lotteries of the 1st petitioner are run in gross violation of the provisions of the Lotteries (Regulation) Act, 1998, especially, Section 4 thereof. The State Government have brought these facts to the notice of the Central Government, by filing Exts.R1(c) and R1(d) representations. The details regarding the violations committed by the 1st petitioner are contained in those representations. They point out that the tickets of the online lotteries are not printed by the State Government. The State Government have brought these facts to the notice of the Central Government, by filing Exts.R1(c) and R1(d) representations. The details regarding the violations committed by the 1st petitioner are contained in those representations. They point out that the tickets of the online lotteries are not printed by the State Government. The sale proceeds are not deposited in the public account of the State. The amounts collected are apportioned between the agents and only a portion of the amount is paid to the State Government. The Government have no control over the draws. Every day, a number of draws are held. They also submit that the State Government are competent to declare the State, free of a particular type of lottery. By distinguishing various decisions of the Apex Court, they further submit that those decisions are concerning paper lotteries and do not cover the case of online lotteries, which is a recent phenomenon. 6. The petitioners have filed a reply affidavit, denying the allegations of the contesting respondents and reiterating their averments in the Writ Petition. 7. Heard learned senior counsel Sri. Sudhir Chandra Agarwala and Sri. P. Sanjay for the petitioners and also Additional Advocate General Sri. Rajan Joseph and learned senior counsel Sri. Nageswara Rao for the respondents. 8. The preliminary objection raised by the respondents in concerning the very maintainability of the Writ Petition. They relied on Article 131 of the Constitution of India, in support of their contention, Article 131 reads as follows: “131. Rajan Joseph and learned senior counsel Sri. Nageswara Rao for the respondents. 8. The preliminary objection raised by the respondents in concerning the very maintainability of the Writ Petition. They relied on Article 131 of the Constitution of India, in support of their contention, Article 131 reads as follows: “131. Original jurisdiction of the Supreme Court:-- Subject to the provisions of this Constitution, the Supreme Court shall, to the exclusion of any other court, have original jurisdiction in any dispute— (a) between the Government of India and one or more States; or (b) between the Government of India and any State or States on one side and one or more other States on the other; or (c) between two or more States, if an in so far as the dispute involves any question (whether of law or fact) on which the existence or extend of a legal right depends: Provided that the said jurisdiction shall not extend to a dispute arising out of any treaty, agreement, covenant, engagement, sanad or other similar instrument which, having been entered into or executed before the commencement of this Constitution, continues in operation after such commencement, or which provides that the said jurisdiction shall not extent to such a dispute.” The respondents point out that the dispute involved in this case is a dispute between the State of Sikkim and the State of Kerala. So, the Apex Court alone has got jurisdiction in this matter. Ext.R1(a) judgment of the Karnataka High Court is cited, in support of this submission. The petitioners met this contention, relying on the decisions of the Hon’ble Supreme Court in State of Bihar v. Union of India (AIR 1970 SC 1446) and State of Rajasthan v. Union of India (AIR 1977 SC 1361). If the dispute involves private parties, the jurisdiction of other courts is not excluded, they submit, drawing support on the above said decisions. In this case, petitioners 2 and 3 cannot invoke the jurisdiction under Article 131 of the Constitution of India. Since, they are also concerned in this dispute, the remedy under Article 226 was rightly invoked, it is submitted. 9. Even if the first petitioner has got a remedy under Article 131 of the Constitution of India, petitioners 2 and 3 cannot invoke the said remedy. Petitioners 2 and 3 are adversely affected by the impugned notification. Since, they are also concerned in this dispute, the remedy under Article 226 was rightly invoked, it is submitted. 9. Even if the first petitioner has got a remedy under Article 131 of the Constitution of India, petitioners 2 and 3 cannot invoke the said remedy. Petitioners 2 and 3 are adversely affected by the impugned notification. Though, they have no fundamental right to engage in the sale of lottery tickets, I feel that if the Government’s action is ultra vires, right must be conceded to them to challenge the same, on showing that they are adversely affected by the said action. The State of Sikkim may choose, not to challenge Ext.P11 and may acquiesce in it. But, if the agents of the State of Sikkim, who are affected by it, are approaching this Court, saying that the Kerala State’s action is ultra vires of its powers under the provisions of the Lotteries (Regulation) Act, I feel that this Court must consider their case on merits. The strict Rule of locus standi evolved in Jasbhai Motibhai Dasai v. Roshan Kumar (AIR 1976 SC 578) that even if a person is adversely affected, he cannot challenge a State action, unless the same infringes his rights stricto sensu, has considerably been diluted over the years. I feel that the petitioners have a legal right to insist that the action of the State, which interferes with their business, should be just, fair and reasonable. In other words, it should not be arbitrary or violative of their rights under Article 14 of the Constitution of India. They can also complain, if the action is found to be contrary to any of the provisions of the Statute. So, I am of the view that they should not be turned away, saying that their principal has got some other remedy before the Hon’ble Supreme Court. Therefore, I am inclined to examine the merits of the case, canvassed by the petitioners. So, with great respect, I find it difficult to persuade myself to follow the course adopted by the Karnataka High Court. 10. Before going into the validity of the impugned notification, it is fruitful to refer to the provisions of the Lotteries (Regulation) Act, 1998. The object and reasons for framing this legislation are published in the Gazette of India dated 27.5.1998. 10. Before going into the validity of the impugned notification, it is fruitful to refer to the provisions of the Lotteries (Regulation) Act, 1998. The object and reasons for framing this legislation are published in the Gazette of India dated 27.5.1998. The relevant portion of it reads as follows: “The conduct of certain types lottery trade in the country, the malpractices thereof and their impact on the poorer sections of the society have been under scrutiny of the Government for quite some time. The continued prevalence of the popularly known single digit and instant lotteries and the temptation offered by them proved to be the undoing of many families, especially poor daily wagers and low income groups. 2. In spite of the guidelines issued by the Central Government over a period of time as also the guidelines issued in the recent past by the Honourable Supreme Court in the matter, the evil has not been totally eliminated and it is felt that a Central legislation to regulate the conduct of lotteries is necessary to protect the interest of the gullible poor.” Section 2(b) defines lottery. It reads as follows: “(b) ‘lottery’ means a scheme, in whatever form and by whatever name called, for distribution of prizes by lot or chance to those persons participating in the chances of a prize by purchasing tickets.” Section 3 provides that no State shall organize, conduct or promote a lottery otherwise than as provided under Section 4. Section 4 enumerates the conditions, subject to which a State Government may organize, conduct or promote a lottery, which reads as follows: “4. Section 4 enumerates the conditions, subject to which a State Government may organize, conduct or promote a lottery, which reads as follows: “4. Conditions subject to which lotteries may be organized etc.:-- A State Government may organize, conduct or promote a lottery, subject to the following conditions, namely:-- (a) prizes shall not be offered on any pre-announced number or on the basis of a single digit; (b) the State Government shall print the lottery tickets bearing the imprint and logo of the State in such manner that the authenticity of the lottery ticket is ensured; (c) the State Government shall sell the tickets either itself or through distributors or selling agents; (d) the proceeds of the sale of lottery tickets shall be credited into the public account of the State; (e) the State Government itself shall conduct the draws of all the lotteries; (f) the prize money unclaimed within such time as may be prescribed by the State Government or not otherwise distributed, shall become the property of that Government; (g) the place of draw shall be located within the State concerned; (h) no lottery shall have more than one draw in a week; (i) the draws of all kinds of lotteries shall be conducted between such period of the day as may be prescribed by the State Government; (j) the number of bumper draws of a lottery shall not be more than six in a calendar year; (k) such other conditions may be prescribed by the Central Government.” From the above provisions, it can be seen that the tickets of a State-run lottery shall be printed by the State itself. Sale of tickets alone, is permitted through the agents. The entire sale proceeds have to be deposited in the public account of the State. Draws of all lotteries have to be conducted by the State Government. No lottery can have more that one draw in a week. Bumper draws shall not be more than six in a calendar year. The cumulative effect of sub-sections (h) and (j) appears to be that a State can run only 52 ordinary lotteries and six bumper lotteries in an year. Section 5 empowers the State Government to prohibit the sale of tickets of lotteries organized by other State Governments. Bumper draws shall not be more than six in a calendar year. The cumulative effect of sub-sections (h) and (j) appears to be that a State can run only 52 ordinary lotteries and six bumper lotteries in an year. Section 5 empowers the State Government to prohibit the sale of tickets of lotteries organized by other State Governments. Section 6 empowers the Central Government to prohibit the conduct of lotteries, which are conducted in violation of the conditions in Section 4 or the tickets of which are sold in contravention of the prohibition, imposed by the State Government under Section 5. Section 7 provides the penalty for running a lottery in violation of the provisions of the Act. The Head of the Department and other officers responsible for the conduct of the lottery shall be punished with imprisonment, which may extend to two years or with fine. Similar punishment can be imposed on those who sell or purchase the tickets of such a lottery. Section 8 makes the offences under the Act cognizable and non-bailable. Cognizable offence means an offence for which a police officer may arrest the accused without warrant (Section 2(c) of the Cr.P.C.). Section 4 of the Criminal Procedure Code reads as follows: “4. Trial of offences under the Indian Penal Code and other laws:--(1) All offences under the Indian Penal Code (45 of 1860) shall be investigated, inquired into, tried, and otherwise dealt with according to the provisions hereinafter contained. (2) All offences under any other law shall be investigated, inquired into, tried, and otherwise dealt with according to the same provisions, but subject to any enactment for the time being in force regulating the manner or place of investigating, inquiring into, trying or otherwise dealing with such offences.” Since no provision is made for investigating the offences under the Lotteries (Regulation) Act, the provisions under the Code of Criminal Procedure will apply to their investigation, by virtue of Section 4(2) of the Cr.P.C. quoted above. Section 154 of the Cr.P.C. enables the Station House Officer to register and investigate criminal cases, upon information, being lodged about the commission of a crime, involving any cognizable offence. After completing the investigation, he should file the final report under Section 173 Cr.P.C. before the concerned Magistrate. While investigating a criminal offence, the police officer is subject only to law and law alone. After completing the investigation, he should file the final report under Section 173 Cr.P.C. before the concerned Magistrate. While investigating a criminal offence, the police officer is subject only to law and law alone. Neither the Government nor the Director General of Police can dictate to him to stop any investigation. None of the provision in the Kerala Police Act or the Code of Criminal Procedure enables the Government or the Director General of Police to do that. Even the power under Section 321 of the Cr.P.C. to withdraw from the prosecution, can be exercised only with the consent of the Central Government, as the relevant legislative entry comes under List I of the VIIth Schedule. If the State Government or its Director General of Police interferes with the investigation of a crime under the Act by the Station House Officer, they will be exposing themselves to the charge of interfering with the due course of justice. In this context, it is apposite to quote the words of Mc Cardie, J. in Fisher v. Oldham Corporation (1930) 2 KB 364), which read as follows: “Suppose that a police officer arrested a man for a serious felony. Suppose, too, that the watch committee of the borough at once passed a resolution directing that the felon should be released. Of what value would such a resolution be? Not only would it be the plain duty of the police officer to disregard the resolution, but it would also be the duty of the chief constable to consider whether an information should not at once be laid against the members of the watch committee for a conspiracy to obstruct the course of criminal justice.” Watch Committee is the controlling body of the Police. The Privy Council noticed with approval, the above words in Attorney General for New South Wales v. Perpetual Trustee Co. (Ltd.) (1955 AC 457). The offences under the Act may be arising out of violations of Sections 3, 4, 5 and 6. Violation of Section 4 will amount to violation of Section 3 also. Normally, in these type of legislations, there will be restrictions on the power of the Courts to take cognizance. There is no such restriction in the Lotteries (Regulation) Act. The offences under the Act may be arising out of violations of Sections 3, 4, 5 and 6. Violation of Section 4 will amount to violation of Section 3 also. Normally, in these type of legislations, there will be restrictions on the power of the Courts to take cognizance. There is no such restriction in the Lotteries (Regulation) Act. But, by virtue of Section 7 of the Act, any Station House Officer, in any State, can book the Director of Lotteries, Sikkim State or of any other State, for the offences under the Act, if they are committed within his jurisdiction. It means Parliament, in its wisdom, has ordained that the offenders under the Act should be dealt with, like any other criminal. 11. In this case, we are mainly concerned with the provisions of Sections 5 and 6 of the Act. Those two Sections cover different fields. Section 5 deals with prohibition of sale of tickets, whereas Section 6 deals with prohibition of conduct of the lottery itself. So, Section 5 enables the State Government to prohibit the sale of tickets of lotteries run by any other State Government. The grounds on which, prohibition of sale of tickets can be made, are not detailed in Section 5. But, the same can be gathered from other provisions of the Act and also, by reference to the object and scheme of the Act. Going by the scheme of the Act, it may appear that violation of any of the conditions contained in Section 4 could be a ground for the State Government to prohibit the sale of tickets of a particular lottery, organized, conducted or promoted by another State Government. If the State Government think it fit, it may prohibit the sale of all lottery tickets in the State and make it a lottery free zone. Section 6 deals with the total prohibition by the Central Government, of a lottery run by a State Government. The Central Government can prohibit the running of a lottery by a State Government, if it is found that the same is run in violation of the provisions of Section 4. The Central Government can also prohibit the running of a lottery, if it is found that the tickets of that lottery are sold in a State, where the sale of the same has been banned by the concerned State Government under Section 5. 12. The Central Government can also prohibit the running of a lottery, if it is found that the tickets of that lottery are sold in a State, where the sale of the same has been banned by the concerned State Government under Section 5. 12. Keeping in mind, the above scheme of the Act, this case has to be decided. The point that arises for decision in this case is whether the State Government, while running paper lotteries and while allowing other Governments to sell their paper lotteries in the State, can prohibit the sale of online lottery tickets in the State, on the ground that the State Government are not running any online lottery. According to the petitioners, online lottery is also a lottery, as defined under Section 2(b) of the Act. So, if the State Government want to prohibit lottery, they have to prohibit all the lotteries, whether paper or online. The selective prohibition of the sale of online lottery tickets is impermissible, in the light of Section 5 of the Act, as interpreted by the Apex Court in B. R. Enterprises v. State of U.P. (1999) 9 SCC 700. The distinction drawn by the State Government between paper lottery and online lottery is discriminatory and violative of Article 14 of the Constitution of India. The petitioners also contend that the impugned notification is vitiated by mala fides. The State Government have been controlled by the paper lottery mafia and under its influence, sale of online lottery tickets has been prohibited. The State Government do not have the competence to issue the impugned notification. Though, the State Government are competent to legislate on lotteries, by virtue of item 34 of List II, concerning betting and gambling, the power to legislate on lotteries organized by the Government of India or the Government of a State, is the exclusive preserve of the Parliament, by virtue of Entry 40 of List I. So, the State Government, which is incompetent to legislate on lotteries, run by other States, has no power to issue the impugned notification. The State Government, without legislative competence, have ventured to prohibit online lotteries. So, it is a fraudulent and colourable exercise of power, it is contended. 13. The respondents support the impugned notification. They assert that the State Government are competent to prohibit a particular type of lottery. The State Government, without legislative competence, have ventured to prohibit online lotteries. So, it is a fraudulent and colourable exercise of power, it is contended. 13. The respondents support the impugned notification. They assert that the State Government are competent to prohibit a particular type of lottery. There is no fetter on the power of the Government under Section 5. They submit, the decision of the Apex Court in B.R. Enterprises’ case dealt with only paper lotteries and not online lotteries. The said decision cannot be construed as a Statute. So, the declaration of law, made therein, is not applicable to online lotteries. It is also submitted that prohibition of sale of online lotteries has been made bona fide and the classification is reasonable and not arbitrary. The scheme of Section 4 would show that the Act was framed with a view to deal with paper lotteries. Section 4(b) says, the State Government shall print the tickets. Section 4(c) says, the State Government shall sell the tickets either by themselves or through agents. Section 4(e) insists that the State Government themselves shall conduct the draws of all lotteries. The distributions of online lotteries do much more than selling the tickets. They decide and implement the lottery schemes, provide infra-structure and technology, print lotteries and participate in the conduct of draws. Section 4(h) prohibits holding of draws, more than once in a week. This restriction has been made, taking into account, the conduct of paper lotteries. But, in online lotteries, 70 to 100 draws are made every day in a week. On the above grounds the respondents pray for dismissal of the writ petition. In answer to the said submissions, the petitioners point out that the contention of the respondents that online lottery was not in the contemplation of the Parliament or the Court, cannot be accepted. The Act has to be interpreted to adapt it to the changing times. The principles laid down by the Apex Court in B.R. Enterprises will apply to all types of lotteries. So, a judgment of the Apex Court cannot be ignored, by saying that it failed to consider some point or other. 14. In support of their submissions, the petitioners, apart from the decision of the Apex Court in B.R. Enterprises, relied on the following decisions: D.S. Nakara v. Union of India (1983) 1 SCC 305), B. Prabhakara Rao & Ors. So, a judgment of the Apex Court cannot be ignored, by saying that it failed to consider some point or other. 14. In support of their submissions, the petitioners, apart from the decision of the Apex Court in B.R. Enterprises, relied on the following decisions: D.S. Nakara v. Union of India (1983) 1 SCC 305), B. Prabhakara Rao & Ors. State of A.P. (1985 (Supp) SCC 432), Pratap Singh v. State of Punjab (AIR 1964 SC 72), H. Anaraj v. State of Maharashtra (1984) 2 SCC 292), Express Newspapers P. Ltd. V. Union of India (1986) 1 SCC 133), Welfare Association v. Ranjit P. Gohil (2003) 9 SCC 58), SIL Import, USA, v. Exim Ades Silk Exporters, Bangalore (1999) 4 SCC 567) & Director of Settlements, A.P. v. M.R. Apparao (2002) 4 SCC 638). The respondents relied on the decisions reported in Kesar Devi v Union of India (2003) 7 SCC 427), Mehboob Dawood Shaikh v. State of Maharashtra (AIR 2004 SC 2890) & Ashwani Kumar Singh v. U.P. Public Service Commission (2003) 11 SCC 584). Going by the controversy to be resolved in this case, a detailed reference to those decisions is unnecessary, except to the decision in B.R. Enterprises. 15. It is common case that the Parliament has got exclusive power to legislate on State lotteries, by virtue of Entry 40 of List I of the VIIth Schedule. By virtue of Entry 34, concerning betting and gambling, State Legislatures have the power to legislate on lotteries, other than State Lotteries. The Apex Court, in B.R. Enterprises’ case has read down Section 5 of the Lotteries (Regulation) Act, to save it from the vice of unconstitutionality, emanating from conferring unbridled power on the State, which may be termed as abdication of the essential legislative function, by failing to provide guidelines for the exercise of that power. In the said decision, it was held as follows: “84. In Section 2(b) lotteries are defined to be a scheme for distribution of prizes by a lot or chance. This definition itself recognizes that even in State lotteries the prizes are to be collected by chance without any skill, hence gambling in nature. Section 3 prohibits that no State lotteries can be organized without the condition stipulated under clauses (a) to (k) of Section 4. Section 4 provides the conditions to be complied with by the State lotteries. This definition itself recognizes that even in State lotteries the prizes are to be collected by chance without any skill, hence gambling in nature. Section 3 prohibits that no State lotteries can be organized without the condition stipulated under clauses (a) to (k) of Section 4. Section 4 provides the conditions to be complied with by the State lotteries. To initiate any State lottery it is left to the policy of each State, for this the Act is silent. The only control is, in case it decides, then it must follow the conditions as laid down under Section 4. Next comes Section 5 which is subject-matter of challenge, the delegation of power to the State to prohibit the sale of lottery tickets organized by every other State. If a State desires not to subject its people to the lottery gambling, it has no power to restrict lotteries organized by other States. It is to remove this mischief that power is conferred through delegation to the States to do it in terms of their own policy. By virtue of this, now the State Government can prohibit sale of lottery tickets of every other State within its territory. Next, Section 6 seeks strict compliance with Section 4. Under this the Central Government may prohibit any State lottery which is being conducted in contravention of the conditions as laid down under Section 4 or Section 5. Section 7 shows the rigour of this Act by making it a penal offence as against all, who violate the provisions of this Act, be it the Head of the Department of the Government or the agent, promoter or trader, to be punishable with two years’ rigorous imprisonment. Section 8 makes such an offence cognizable and non-bailable. Similarly, Section 9 deals with offences committed by the companies. Section 10 entrusts the Central Government for carrying into execution the provisions of this Act, Rule or Order. Sections 11 and 12 are the rule-making power entrusted to the Central and the State Governments respectively. Section 13 repeals the Ordinance. Thus, the whole Act makes clear that the subject it is dealing with is gambling in nature. The object of the Act is not to control the policy decision of each State to start or to close its lotteries, but to regulate it in case a State decides to run its own lottery through modalities and conditions laid down there. Thus, the whole Act makes clear that the subject it is dealing with is gambling in nature. The object of the Act is not to control the policy decision of each State to start or to close its lotteries, but to regulate it in case a State decides to run its own lottery through modalities and conditions laid down there. Emphasis of the whole Act is to abide by the conditions strictly if you want to run a lottery. Thus, regulation is through conditions to eliminate even the remotest possibility of malpractices by providing stringent measures for its compliance. Perusal of the Act reveals, the scheme of the Act is limited in its application, and it admits the subject it is dealing is gambling in nature. As we have said, the decision to collect or not to collect revenue through State lotteries is exclusively within the policy decision of the State and for this, neither the Union nor Parliament interferes nor is there any indication under the Act. Thus, the question which remains is, if any State decides that it does not want any lotteries but if it feels helpless as having no jurisdiction over the lotteries organized by other States, what is the way out? This can only be done by Parliament or by entrusting this power on such State desiring so, which has been done through Section 5. In this background, for this helplessness of a State as recorded in Anraj case-I (1984) 2 SCC 292) the remedy is provided by entrusting this power on the State under the impugned provision. This helps such State to achieve its objective of lottery (gambling) free zone within its territory. A well-concerned remedy. Next question is what could have been the guideline? If State lotteries are gambling and it cannot be termed as ‘trade and commerce’ at common parlance for any free right under the Constitution. Such right though recognised under Article 298, so other States may continue to enjoy till prohibited by valid law, and if any State wants within its State lottery-free zone and for which the power is entrusted to such State, it cannot be said in this setting and background and the nature of the subject that such a delegation is of its essential legislative power. The only guideline necessary in such delegation is to see that the State does not pick and choose one State from the other, which guideline is already provided in this section. It provides that such a ban could only be if it is applied to every other State. The only residual field of attack so far as this delegation could be, which has been attacked in this case, that the State could on one hand ban lotteries of every other State but run its own lotteries. It is argued that while a State bans lotteries of other States not to permit any gambling activity in the public interest as a policy but this very public interest is flouted by having lotteries of its own. It is true that unless this provision is read down to mean a State can only ban lotteries of other States when it bans as a policy its own lotteries it is bound to be subjected to the vagaries as pointed out and on deeper scrutiny it may not successfully stand. But, by reading down the provision, which has to be read that it is only that State which decides lottery-free zone within its State can prohibit lotteries of other States clearly provides the guidance for the exercise of such a power. It is inbuilt and inherent in the provisions itself in view of the scheme of the Act and nature of subject in issue. If interpretation as given on behalf of the State of Tamil Nadu is accepted that delegation of power is absolute, then the submission that such delegation is unbridled without any guideline carries great weight. Submission for the State of Tamil Nadu is that the lotteries may be prohibited in phases, viz. while running its own lotteries yet prohibiting other lotteries, may be as a public policy, for law and order, for political reasons, morality etc. For surviving such an interpretation given by Mr. Ganguli, Parliament should have provided some guidelines. Such an interpretation falls into the trap of the submission that this delegation is unbridled. So, if there are two interpretations, the interpretation which upholds the validity should be accepted. So, the interpretation as given by Mr. Ganguli cannot be accepted. xxxxx xxxxx xxxxx xxxxx xxxxx 87. Ganguli, Parliament should have provided some guidelines. Such an interpretation falls into the trap of the submission that this delegation is unbridled. So, if there are two interpretations, the interpretation which upholds the validity should be accepted. So, the interpretation as given by Mr. Ganguli cannot be accepted. xxxxx xxxxx xxxxx xxxxx xxxxx 87. We find on pain reading of Section 5, it empowers the State Government within its State to prohibit the sale of tickets of the lotteries organized by every other State. There is also nothing in the language reading by itself so as to say, whether such power can be exercised by the State while running its own lottery or can be exercised only where such State does not run its own lottery. This leads to two possible interpretations, as referred to above. In view of settled principle of interpretations, the interpretation given by the Union to read down the provision has substance. This would mean that the State could only exercise such discretion if it decides not to have any lottery within its territory including its own lottery. In this situation, the delegate is tied down by this limitation which itself is a clear guide to a State hence cannot be said to be unbridled delegation. So even to the first part it cannot be said to e arbitrary or unbridled. So, we have no hesitation to approve the interpretation given by the Union to uphold the validity of Section 5.” Relying on the above quoted words of the Hon’ble Supreme Court, the petitioners vehemently contended that the State shall either prohibit the sale of all lotteries or allow the sale of all lotteries in the State. Selective prohibition of a particular type of lottery is impermissible in the light of the above binding judgment of the Apex Court, it is contended. 16. Online lotteries became popular in our country, only recently. They made their presence felt in India from 2000-2001 onwards. Though, all types of lotteries are meant to be regulated by the Lotteries (Regulation) Act, 1998, the deleterious effect of paper lotteries was uppermost in the mind of the Government, while bringing forth, the above legislation, as, at the relevant time, paper lotteries were the most popular lotteries among the people. Though, all types of lotteries are meant to be regulated by the Lotteries (Regulation) Act, 1998, the deleterious effect of paper lotteries was uppermost in the mind of the Government, while bringing forth, the above legislation, as, at the relevant time, paper lotteries were the most popular lotteries among the people. The various sub-sections of Section 4 will reveal that the irregularities in the conduct of paper lotteries were mainly in the contemplation of the Parliament. The Apex Court, in B.R. Enterprises’ case also dealt with the prohibition of sale of tickets of paper lotteries, made by the State Governments, invoking the power under Section 5 of the Lotteries (Regulation) Act. Still, the general principles laid down by the Apex Court, while interpreting Section 5, are binding. In the light of the decision of the Apex Court in B.R. Enterprises, I feel that a reading of Section 5 will give answer to the controversy. Section 5 reads as follows: “5. Prohibition of sale of ticket in a State:- State Government may, within the State, prohibit the sale of tickets of a lottery organized, conducted or promoted by every other State.” (emphasis supplied). So, the power to prohibit sale of tickets, is granted in relation to a particular lottery or particular type of lottery. That means, a particular lottery can be the subject-matter of prohibition. In other words, all types of lotteries need not be prohibited. But, going by the decision of the Apex Court in B.R. Enterprises’ case, a particular type of lottery can be prohibited, if only, the State Government also do not run that lottery. The online lottery is a particular lottery, which is not run by the State Government. So, going by the principles laid down in B.R. Enterprises’ case, the State Government can ban the sale of online lotteries. The same will not be hit by the decision of the Apex Court in the said case, interpreting Section 5 of the Act. Online lottery is a particular class of lottery, different and distinct from paper lotteries. 17. The State Government have found several irregularities committed in the conduct of online lotteries by the Sikkim Government. The same will not be hit by the decision of the Apex Court in the said case, interpreting Section 5 of the Act. Online lottery is a particular class of lottery, different and distinct from paper lotteries. 17. The State Government have found several irregularities committed in the conduct of online lotteries by the Sikkim Government. In Ext.R1(c) letter to the Central Government, the following irregularities are pointed out: “Government of Sikkim The details is furnished in letter No.714/Fin/DSSI, and 718/Fin/DSSI, on 14.11.2001 (Annex.A10) by the Government of Sikkim reveal that most of the provisions laid down in Section 4(a) to (k) of the Lotteries (Regulation) Act, 1998, are violated, as described below: a. The Sikkim Online Network Lottery Rules (Annex.A11) came into effect on 31st August, 2001. The Agreement executed on 24th August, 2001 between the State and M/s. Tashy Delek Gaming Solutions Pvt. Ltd. (Annex. A12) reveals that the Agreement was signed 7 days before the Sikkim Online Network Lottery Rules came into effect. Section 4(c) of the Central Act specifies that ‘ the State Government shall sell the tickets either itself or through distributors or selling agents. Under Rule 18(1) of the Sikkim Rules, ‘the State Government may appoint marketing agent for selling the computerized network lottery tickets.’ It is also mentioned that the State Government may permit such agent to ‘set up required infrastructure and use of technology for the purpose’. This is clearly more than what is statutorily permissible under Section 4(c) of the Act. b. Section 4(c) of the Act prescribes that the State Government shall itself conduct the draws of all the lotteries. In Letter No.671(a)/Fin/DSSI dated 06.11.2003, the Director of Lotteries, Sikkim has stated that the State Government itself is conducting the draws of online lotteries. But, as per the ‘Methodology for Conducting the draw’ (Annex.A.13), the draw is held in the presence of a representative of the Government and a representative of the Tashi Delek Gaming Solutions Pvt. Ltd. Even one of the keys of the room where the draw machines are kept is with M/s. Tashi Delek Pvt. Ltd. Therefore, it is evident that the Government of Sikkim has given away at least one half its responsibility for ‘Itself conducting the Draw’ to a private party. It is interesting to note that this delegation of partial responsibility for conducting the Draws does not find a place in the Agreement between the Government and M/s. Tashi Delek. Section 4(c) of the Central Act is clearly violated. According to Section 4(b) of the Act, ‘the State Government shall print the lottery, tickets’. Rule 9(2) of the Sikkim Rules states ‘printing of the lottery tickets shall be by the terminal.’ At the same time, clause 17(b) of the Agreement sates that the tickets will be printed in the machines through its inbuilt mechanism. As per Rule 12 of the Sikkim Online Network Lotteries Rules, 2001, the tickets will be printed on pre-printed ticket material. But the specimen tickets reveal that they are printed on Playwin stationery. The tickets also bear the message that ‘get prizes up to Rs.5000/- across counter, tax free’. The specimen ‘play slips’ submitted by the Director, State Lotteries bear the Playwin logo. Evidently, the tickets are instantly printed at the retail computer terminal in clear violation of Section 4(b), which insists, ‘the State Govt. shall print the lottery tickets.’ d. The prize structure of Super Lotto and Thunder Ball (Annex. A.14) clearly reveals that the intending players, purchasing tickets are misled. The approximate prize amount when 6 numbers are matched is stated as ‘minimum assured Rs.1 Crore’ with odds of 13,983,816. A footnote in small print states that ‘Jackpot will be hit approximately every 4.66 Draw’ for Super Lotto. Similarly for Thunderball the Jackpot is claimed to be hit approximately every 4.25 Draws. Intending players are deceived and deliberately given the impression that Rs.1 Crore is the 1st prize for each draw. e. In Thunder Ball, the last prize amount of Rs.20/- is won when one main number and Thunder Ball (fixed) are matched. It is obvious that, since the probability of winning is more than 1 out of 10, this is a single digit lottery specifically prohibited under Section 4(a) of the Lotteries Regulation Act, 1998).” In Ext.R1(d) letter the following irregularities are pointed out against the lottery run by the 1st petitioner: “SIKKIM The violations in respect of Sikkim State Lotteries had already been reported to the Ministry of Home Affairs, Government of India on 12.01.2004, vide ref. I cited. I cited. The schemes of lotteries furnished by the Government of Sikkim revealed that they were not in conformity with the provisions of Section 4 of the Lotteries Regulation Act, 1998. The irregularities/violations in respect of the Sikkim lotteries being sole in Kerala as in January 2004 were brought to the notice of the State Government earlier with a request for further documents/clarifications. Some of these violations/irregularities are briefly mentioned below: i. On a perusal of the agreement between the Government of Sikkim and M/s. Tashi Delek Gaming Solutions Pvt. Ltd., the Marketing Agent, it is seen that the agreement with the marketing agent is executed seven days before the Sikkim Online Network Lottery Rules came into effect. ii. The Marketing Agent is vested with powers more than what the Lottery Regulation Act permits. The State of Sikkim was asked to offer specific remarks on this. iii. Since a detailed description of the method of draw was not furnished by the State of Sikkim, the same was called for from this office. iv. As per rule 12 of the Sikkim Online Network lottery Rules, 2001, the tickets will be printed on pre-printed ticket material. On perusal of the tickets of Super-Lotto and Thunder Ball it is seen that the specimen play slips furnished by the Director of Lotteries, Sikkim bear the imprint and logo of PLAYWIN. This shows that the tickets are instantly printed at the retail computer terminal, violating Section 4(b) of the Lotteries Regulation Act, 1998. v. The contractual agreement between the Play Win sub-agent and the distributors was not furnished. So also the names of distributors for certain districts in Kerala were not furnished. vi. The Government have furnished the details of 926 retail outlets operating in the State. But the contractual agreement between the distributor and these retail outlets were not submitted. vii. The Marketing Agent under the Sikkim State lotteries is empowered to set-up the required infrastructure and use of technology for the draw purpose. It is clearly more than what is statutorily permissible under Section 4(c) of the Act. viii. As per section 4(e) of the Central Act, ‘the State Government itself shall conduct the draws of all the lotteries’. But actual conduct of the draws is done by the Marketing Agent, reducing the role of the State Government to that of a mere spectator, thereby violating the above provision. ix. viii. As per section 4(e) of the Central Act, ‘the State Government itself shall conduct the draws of all the lotteries’. But actual conduct of the draws is done by the Marketing Agent, reducing the role of the State Government to that of a mere spectator, thereby violating the above provision. ix. In Thunderball, the last prize amount of Rs.20/- is ‘when one main number and the Thunder ball (fixed) are matched’. Until clarifications to the contrary are provided with evidence it has to be presumed that this is a camouflaged single digit lottery specifically prohibited under Section 4(a) of the Central Act. A representative of the State Government of Sikkim was present at the meeting convened by the Joint Secretary (CS) Ministry of Home Affairs, Government of India in his Chamber on 6.7.2004. The remarks of the Government of Kerala on the explanations offered at the meeting are given below: The fresh Agreement of the Sikkim Government is not received till date. It was pointed out in the letter to the Government of India that Sikkim has delegated more rights and responsibilities to the Marketing Agent than what is statutorily permissible under the Act. However, regarding the appointment of Marketing Agents, the State of Sikkim has informed that they will discuss the matter with the legal wing. The State of Sikkim has admitted that the tickets are printed on PLAYWIN Stationery, clearly admitting violation of Section 4(b) of the Act. Regarding the allegation that ‘Thunder Ball’ lottery is organized on the basis of single digit, the State of Sikkim has not offered any reasonable explanation or furnished any document. Instead the State has merely refuted the allegation. Even though the State of Sikkim was requested to furnish details/documents/clarifications regarding the allegations raised, no reply was received from them. The Government of Sikkim was reminded on 11.05.2004 and 15.06.2004 to furnish the details called for earlier and also to provide details of the new lotteries introduced by them in Kerala. There has been no response from the State so far. Thus the violations and irregularities pointed out in respect of Sikkim State Lotteries as in January, 2004 continue unabated. The Government of Sikkim was reminded on 11.05.2004 and 15.06.2004 to furnish the details called for earlier and also to provide details of the new lotteries introduced by them in Kerala. There has been no response from the State so far. Thus the violations and irregularities pointed out in respect of Sikkim State Lotteries as in January, 2004 continue unabated. This shows that the Government of Sikkim is not inclined to address the serious issues pointed out by the Government of Kerala with regard to the illegalities and violations connected with Sikkim State Lotteries, tickets of which are sold among the public of Kerala. What is extremely alarming is the sudden spurt of new Sikkim State Lotteries recently introduced in Kerala, all of them violating the provisions of Section 4 of the Act. What is extremely alarming is the sudden spurt of new Sikkim State Lotteries recently introduced in Kerala, all of them violating the provisions of Section 4 of the Act. Information on some of these Lotteries (On-Line and ‘paper’) newly introduced in the State by the Government of Sikkim, collected from the retailers and from ‘results’ published in newspapers is indicated below: Name of Lottery SUBHALAKSHMI SERIES (DAILY) Time of Draw Number of Draws Maruti 9.45 Am Surabhi 10.00 AM Aarati 10.01 AM Megha 10.15 Am Samrat 10.30 AM Alka 10.31 AM Mahalakshmi 10.45 AM 69 Sundar 11.00 AM Tilks 11.01 AM Mohan 11.15 AM Sajan 11.30 AM Amar 11.31 AM Mahadevi 11.45 AM Sajani 12.00 PM Golta 12.01 PM Meera 12.15 PM Saagun 12.30 PM Ambar 12.31 PM Maharaja 12.45 PM Super 01.00 PM Dube 01.01 PM Mini 01.15 PM Sitara 01.30 PM Amit 01.31 PM Monika 01.45 PM Ratranj 02.00 PM Subhlakshmi 02.01 PM Meena 02.15 PM Sikka 02.30 PM Anand 02.31 PM Maneesha 02.45 PM Supreme 03.00 PM Venus 03.01 PM Maharani 03.15 PM Sagar 03.30 PM Anjana 03.31 PM Milan 03.45 PM Sreeman 04.00 PM Makuri 04.01 PM Manju 04.15 PM Sreegar 4.30 PM Atrar 04.31 PM Mala 04.45 PM Sreemathi 05.00 PM Lotus 05.01 PM Milo 05.15 PM Sher 05.30 PM Amsu 05.31 PM Madan 05.45 PM Rony 06.00 PM Jupiter 06.01 PM Mamata 06.15 PM Sikkander 06.30 PM Appu 06.31 PM Mallik 06.45 PM SUPER SERIES (DAILY) Golta 11.15 AM Diamond 11.45 AM Pal 12.15 PM Platinum 12.45 PM Pradeevi 01.15 PM Maruti 01.45 PM Anand 02.15 PM Surabhi 02.45 PM Lakshmi 03.15 PM Megha 03.45 PM 21 Savera 04.15 PM Mahalakshmi 04.45 PM Evening 05.15 PM Mohan 05.45 PM Ganesh 06.15 PM Meera 06.45 PM Kiran 07.15 PM Moon 07.45 PM Sagar 08.15 PM Supreme 08.45 PM Dhanam 09.15 PM Preliminary enquiries reveal that these lotteries are blatantly violating the provisions contained in Section 4 of the Lotteries Regulation Act of 1998. All these lotteries are conducted daily, violating Section 4(h) of the Act. More than 60 draws are conducted per day on a minute to minute basis. All these lotteries are ‘instant’ in nature and offer prizes on the basis of single-digits violating Section 4(a). The State of Sikkim has recently introduced a lottery by name JOKER (CARDS) offering ‘Rs.100/by paying just Rs.11/’. More than 60 draws are conducted per day on a minute to minute basis. All these lotteries are ‘instant’ in nature and offer prizes on the basis of single-digits violating Section 4(a). The State of Sikkim has recently introduced a lottery by name JOKER (CARDS) offering ‘Rs.100/by paying just Rs.11/’. To get over the provisions relating to single ‘digits’, the lottery uses the symbols of Playing Cards, viz. Hearts, Clubs, Diamond and Clover. The draws are held daily as per the following schedule: Joker Silver 12 pm Joker Gold 01 pm Joker Diamond 02 pm Joker Platinum 03 pm Joker Pearl 04 pm Joker 05 pm The BHAGYA EXPRESS lotteries recently introduced in Kerala in the name of the Government of Sikkim violate all the provisions of the Lottery Regulation Act, 1998. Bhagya Express lottery is a daily lottery with first prize for Rs.122/- and second prize for Rs.100/-. Tickets are issued in a set of 10 numbers. It is interesting that the terms and conditions are not printed on the reverse of the ticket but it is Stated that terms and conditions can be had from the Government of Sikkim/Sole Distributor. It is then evident that even the terms and conditions of this lottery are determined by the Sole Distributor.” 18. The petitioners are denying the above allegations. According to them, online lottery is transparent and everything is done perfectly. The petitioners, in para 21 of the Writ Petition, have pleaded, how the online lottery is run, which reads as follows: “The Online lottery involves installation of a Central Server, various terminals, which are connected to the said Central Server through a satellite and all this involves huge expenses running into hundred of crores. In this online lottery form, there are no pre-printed tickets as such. A person interested to purchase a ticket of online lottery comes to the terminal, fills a play-slip with numbers selected by him and hands it over to the person manning the terminal. This play-slip is put into the terminal and numbers selected by the player are transmitted to the central server, which registers the said numbers. A person may not like to select any numbers and may play lucky dip in which case the computers makes random generation of numbers itself and transmit them to the central server, which registers the said numbers. A person may not like to select any numbers and may play lucky dip in which case the computers makes random generation of numbers itself and transmit them to the central server, which registers the said numbers. In either of the cases after the central server has registered the numbers it generates a ticket and commands the terminal, which acts like a fax on command and delivers the ticket, which is on an imported thermal paper. The ticket besides containing these numbers contains various codes, details as also bar codes, which ensures against any possibility of any duplication etc. The game is made more interesting and entertaining since the player has option to choose numbers for himself. Like paper lottery in this case also various tickets can be printed and sold as such, however, the same may not sell at all because the player does not like to loose the charm of selecting the numbers himself. However, whatever be the position, all the details regarding the number of tickets sold, their respective playing numbers, the number to tickets sold from each terminal etc. are all available in the central server. The generation of tickets for any particular scheme closes 30 minutes before the holding of the draw and no retail terminal can generate a ticket for such draw after such closing and at the time of draw all the details are readily available to the authorities immediately before the draw. The draw is held by the respective State themselves through a temper free machine and is telecast on the Zee Television network and watched by the public at large.” The claim of the petitioners that they are doing everything perfectly can only be a tall claim. Every one, who has something to do with computers, knows that using different softwares simultaneously in the computers, any type of manipulation can be done in the printing of tickets, which is done at the terminal. The customer cannot know whether the ticket is printed at the terminal, based on the command from the Central server or not. The Sikkim Government does not have any control over the thousands of terminals all over India. As per Section 4(h) of the Act, the draw should be held only once in a week. It means a fortune seeker, after purchasing the ticket will get a week’s cooling time to wait for the result of the draw. The Sikkim Government does not have any control over the thousands of terminals all over India. As per Section 4(h) of the Act, the draw should be held only once in a week. It means a fortune seeker, after purchasing the ticket will get a week’s cooling time to wait for the result of the draw. But, under the scheme of online lotteries, so many lotteries are run simultaneously. Even as admitted by the petitioners, the sale of tickets will be closed only by 30 minutes before the draw. So, by holding several lotteries, there can be several draws with a gap of few minutes in a day and the gullible will remain glued to the place of sale of tickets and there is likelihood of purchase of tickets repeatedly, till all his savings are exhausted. So, if the Government take a decision in public interest, to prohibit online lotteries, this Court should not interfere with the said decision, unless there are compelling grounds. As held earlier, going by Section 5, as interpreted by the Apex Court, the sale of ticket of a particular lottery can be prohibited, provided the concerned State Government are also not running that lottery. Therefore, the contentions of the petitioners regarding lack of power or fraud on power etc., cannot be accepted. While interpreting a Statute of this nature, meant to suppress the mischief of gambling, this Court should accept the concept of purposive interpretation and if possible, save a notification, intending to save the people from the vice of gambling. 19. It is common case that lottery is a species of gambling. Gambling is considered as a pernicious vice by all civilized societies from time immemorial. The Rigvedas, Smritis and Arthashastras have condemned gambling as a vice. Judges and learned authors are unanimous in their condemnation of gambling. The American Supreme Court, as early as in 1850, in Phalen v. Virginia (49 US 163) has held as follows: “Experience has shown that the common forms of gambling are comparatively innocuous when placed in contrast with widespread pestilence of lotteries. Judges and learned authors are unanimous in their condemnation of gambling. The American Supreme Court, as early as in 1850, in Phalen v. Virginia (49 US 163) has held as follows: “Experience has shown that the common forms of gambling are comparatively innocuous when placed in contrast with widespread pestilence of lotteries. The former are confined to a few persons and places, but the latter infests the whole community: it enters every dwelling; it reaches every class; it preys upon the hard earnings of the poor, it plunders the ignorant and the simple.” In Words and Phrases, Butterworths, 3rd Edition at page 71, it is stated as follows: “It must not be entirely forgotten in the construction of these Acts of Parliament (see now the Lotteries and Amusements Act, 1976) that the evil which the lottery law has sought to prevent was the evil which existed where poor people with only a few pence to feed their children would go and put these few pence into a lottery and lose them, and this sociologically was a bad thing….” The Honourable Supreme Court exhaustively considered all the materials from Vedas to various foreign judgments on gambling in B.R. Enterprises’ case and held as follows: “From the references from Dharmashastra, opinions of distinguished authors, references in the Encylopaedia Britcannica and Boston Law Review and others, we find that each concludes, as we have observed, lottery remains in the realm of gambling. Even where it is State-sponsored still it was looked down upon as an evil. Right from ancient time till the day all expressed concern to eliminate this, even where it was legalized for raising revenue either by the kind or in the modern times by the State. Even this legitimization was for the sole purpose of raising revenue, was also for a limited period, since this received condemnation even for this limited purpose. Right from ancient time till the day all expressed concern to eliminate this, even where it was legalized for raising revenue either by the kind or in the modern times by the State. Even this legitimization was for the sole purpose of raising revenue, was also for a limited period, since this received condemnation even for this limited purpose. All this gives a clear picture of the nature and character of lottery as perceived through the conscience of the people, as revealed through ancient scriptures, also by various courts of the countries.” The Apex Court further added: “But it cannot be doubted and it is recognised by all the countries that gambling by its very nature promises to make a poor man a rich man; to quench the thirst of a man in dire economic distress or to a man with a bursting desire to become wealthy overnight it draws them into the magnetic field of lotteries with crippling effect. More often than not, such hopes with very remote chance encourages the spirit of reckless propensity in him, ruining him and his family. This encouraging hope with the magnitude of prize money never dwindles. Losses and failures in lotteries instead of disencouragement increases the craze with intoxicating hope, not only to erase the losses but to fill his imaginative coffer. When this chance mixes with this utopian hope, he is repeatedly drawn back into the circle of lottery like a drug addict. Inevitably, the happiness of his family is lost. He goes into a chronic state of indebtedness.” 20. In fairness, it must be conceded that Section 5, in the light of the interpretation of the Apex Court in B.R. Enterprises’ case, admits two interpretations. One is that the State can prohibit one form of lottery, if only it is not running any lottery at all. The second interpretation is that the State can prohibit a particular form of lottery, if it is not running that form of lottery, even if it is running other types of lotteries. The Act has been designedly made to suppress the mischief of lottery. Therefore, I feel that an interpretation, which advances the object of the Act, should be favoured. That means, the State can prohibit online lotteries, if it is not running the said type of lotteries. The Act has been designedly made to suppress the mischief of lottery. Therefore, I feel that an interpretation, which advances the object of the Act, should be favoured. That means, the State can prohibit online lotteries, if it is not running the said type of lotteries. The decision of the Apex Court in B.R. Enterprises’ case, which was dealing with the prohibition of paper lotteries, does not stand in the way of accepting such an interpretation. Accordingly, the main challenge against the impugned notification that it violates Section 5 of the Lotteries (Regulation) Act, is repelled. 21. The allegations of mala fides etc. are made without any supporting material in the writ petition. In view of the above position, no ground has been made out, warranting interference with Ext.P11, to the extent, it prohibits online lotteries. Accordingly, the Writ Petition is dismissed. No costs. W.P.(C).Nos.16063 & 19582/2005: 22. In view of the dismissal of W.P.(C).14495/2005, these writ petitions are also dismissed. No costs.