2.1 Introduction: Setting the Table

The decision of the Allahabad High Court in M/s DM Gaming Pvt. Ltd. v. State of U.P. & Ors SCC Online 2024 All 5009 marks an important reaffirmation of two settled yet frequently contested principles of Indian constitutional and gaming law: (i) the distinction between games of skill and gambling, and (ii) the obligation of administrative authorities to act on reasoned, evidence-based grounds rather than conjecture.

Decided by a Division Bench comprising Hon’ble Justice Shekhar B. Saraf and Hon’ble Justice Manjive Shukla, the Court examined the legality of an order passed by the Deputy Commissioner of Police, City Commissionerate, Agra, which had denied permission to the petitioner to operate a gaming unit where poker and rummy were proposed to be played. The judgment, though concise, carries significant jurisprudential weight in delineating the limits of executive discretion in matters involving lawful recreational and commercial activities.

2.2 The Cards on the Table: Facts of the Case

The petitioner, M/s DM Gaming Pvt. Ltd., approached the Allahabad High Court under Article 226 of the Constitution of India, aggrieved by an order dated 24 January 2024 issued by the office of the D.C.P., City Commissionerate, Agra.

The impugned order rejected the petitioner’s application seeking permission to run a gaming unit where card games such as poker and rummy would be played. The refusal was premised on apprehensions that:

1. gambling might take place, and
2. public peace and harmony could be disturbed.

Notably, the order did not examine whether the proposed games fell within the legal category of gambling, nor did it record any factual material suggesting actual or imminent illegality.

2.3 Submissions of the Parties

1. Petitioner’s Contention, Sri Amit Saxena, ld Senior Advocate; First Bet

The petitioner contended that the impugned order was arbitrary, non-speaking, and founded on mere surmises. Reliance was placed on authoritative judicial precedents, including:

1. State of Andhra Pradesh v. K.S. Sathyanarayana (AIR 1968 SC 825), and
2. Junglee Games India Pvt. Ltd. v. State of Tamil Nadu (Madras High Court).

It was argued that poker and rummy are games involving substantial skill, and therefore cannot be equated with gambling merely because stakes may be involved. The petitioner further submitted that the D.C.P. failed to apply settled law and mechanically denied permission.

2. State’s Position, Sri Praveen Kumar Giri, ld A.A.G. ; Call

The State defended the impugned order on the ground that gambling is prohibited and that the police authorities were justified in exercising caution to prevent any unlawful activity.

2.4 Issues Before the Court: The Flop

The High Court was essentially called upon to determine:

1. Whether the denial of permission to operate a gaming unit offering poker and rummy was legally sustainable; and
2. Whether administrative authorities can refuse permission without examining settled judicial precedent and without recording concrete facts.

2.5 Allahabad High Court’s Order dated 29.08.2024: The Show

Upon a holistic consideration of the matter, the Court is of the considered view that the competent authority is obligated to examine the issue afresh in the light of the binding judgments of the Hon’ble Supreme Court and the various High Courts governing the field. The denial of permission founded merely on speculative apprehensions or the subjective foresight of the officer concerned is wholly unsustainable in law. Any decision refusing permission to carry on recreational gaming activities must be supported by cogent, objective, and tangible material placed on record. The Court further clarifies that the grant of permission, by itself, shall not in any manner preclude or fetter the powers of the authorities to inspect the premises and take appropriate action in accordance with law, should any act amounting to gambling or illegality be detected. In view of the aforesaid observations, the authority concerned is directed to reconsider the petitioner’s application and pass a reasoned and speaking order, after affording an opportunity of hearing to the petitioner, within a period of six weeks from the date of this order. With these directions, the writ petition stands disposed of.

2.6 Findings and Reasoning of the Court

1. Poker and Rummy: Skill, Not Gambling

While the Court refrained from an elaborate doctrinal analysis, it unequivocally noted that the authority concerned failed to consider binding judgments of the Supreme Court and various High Courts holding that poker and rummy are games of skill.

The Court found fault with the approach adopted by the D.C.P., observing that the permission was denied “without going into the aspect that card games i.e. Poker and Rummy are absolutely a game of skill and not gambling.” This omission rendered the decision legally infirm

b. Administrative Decisions Cannot Be Based on “Clairvoyance”

One of the most significant aspects of the judgment is its strong rebuke of speculative administrative action. The Court categorically held that:

“Denial of the permission only on the basis of the clairvoyance of the officer concerned cannot be a ground that can be sustained.”

The Bench emphasized that hard facts must be brought on record to justify refusal of permission. Mere apprehension of disturbance to public order or the possibility of gambling, without supporting material, does not meet the threshold of lawful administrative decision-making.

c. Regulatory Powers of the State Preserved

Importantly, the Court balanced individual and commercial freedoms with regulatory oversight. It clarified that granting permission would not curtail the power of authorities to inspect the premises or take action if gambling or other illegal activities were actually found to be taking place. This observation reinforces that preventive speculation cannot replace post-facto enforcement based on evidence.

d. Operative Directions

In light of the above findings, the High Court:

1. Set aside the impugned order dated 24 January 2024;
2. Directed the competent authority to revisit the issue;
3. Mandated the passing of a reasoned order after granting the petitioner an opportunity of hearing; and
4. Fixed a six-week timeline for completion of this exercise.

The writ petition was accordingly disposed.

2.7 Significance and Legal Impact

This judgment is significant for multiple reasons:

1. Reaffirmation of Skill-Based Gaming Jurisprudence: The ruling reinforces long-standing judicial recognition that poker and rummy are not gambling per se.

2. Limits on Police and Administrative Discretion: It underscores that executive authorities cannot deny permissions affecting lawful business activities on the basis of vague fears or moral policing.

3. Strengthening Procedural Fairness: The insistence on a reasoned order and opportunity of hearing aligns with principles of natural justice under Articles 14 and 19(1)(g) of the Constitution.

4. Guidance for Future Gaming-Related Permissions: The decision will likely serve as persuasive precedent in disputes involving denial of licenses or permissions for gaming establishments, both offline and potentially online.

2.8 Conclusion

M/s DM Gaming Pvt. Ltd. v. State of U.P. & Ors. is a clear assertion by the Allahabad High Court that lawful recreational activities cannot be stifled by administrative conjecture. By insisting on adherence to precedent, factual scrutiny, and reasoned decision-making, the Court has contributed meaningfully to the evolving jurisprudence on gaming regulation in India. The judgment strikes a careful balance between individual economic liberty and the State’s duty to prevent illegality, making it a valuable reference point for courts, regulators, and stakeholders in the gaming ecosystem.

Co- Authors - Aishwarya Mahajan & Vaibhav Karotia

Note: This concludes Part II of a VI Part analytical series on The Legal Anatomy of Poker.

Part III will examine the Ground Reality, focusing on establishment of poker houses in India.