The Supreme Court has held that states possess the legislative authority to enact laws restricting or prohibiting online games such as rummy, poker and other forms of gambling, wagering and skill-based gaming in the interest of maintaining "public order" and preventing the "degradation and exploitation of youth and their hard-earned money".

The ruling came as the apex court allowed separate appeals filed by Tamil Nadu and Karnataka against judgments of the Madras High Court and the Karnataka High Court, which had struck down the constitutional validity of laws enacted by the respective states.

Both high courts had held that states lacked the power to frame laws and rules regulating online betting, wagering and gaming activities.

Among the legislations invalidated by the high courts was Part II of the Tamil Nadu Gaming and Police Laws (Amendment) Act, 2021, which was struck down primarily on the ground that "betting" under Entry 34 of List II could not include poker and rummy as prohibited games of chance.

The other legislation was the Karnataka Police Act, 1963, as amended by the Karnataka Police (Amendment) Act, 2021, which sought to address the growing menace of online betting and gambling and curb the rise of virtual gambling houses, activities not specifically regulated under the original 1963 law.

Challenging these rulings, both states approached the Supreme Court.

Allowing the appeals, a bench comprising Justice J.B. Pardiwala and Justice R. Mahadevan held that the impugned legislations were constitutionally valid as they had "sought to prevent this moral and material abandonment, mental degradation and prevent the exploitation of youth and their hard-earned money."