A Bench of Justices J.B. Pardiwala and K.V. Viswanathan made the observation while hearing a batch of petitions challenging the provisions of the new Act, which came into effect earlier this year to regulate online gaming and prohibit wagering-based platforms.

During the hearing, the Bench engaged with one of the petitioners — a professional chess player — who explained that she participated in skill-based tournaments by paying an entry fee and competing for prizes. The Court then remarked: “Then there is no problem for you. They [the Government] do not object to tournaments… Tournaments are completely excluded.”

The Bench further noted that regular competitions and tournaments may not fall within the definition of “betting and gambling”, signalling that genuine skill-based events could remain outside the ambit of the ban.

The Court has sought a comprehensive response from the Union Government by November 26, seeking clarity on how the new legislation distinguishes between betting, gambling, and competitive gaming.

Act under scrutiny

The Online Gaming Act, 2025, defines an “online money game” as any game where a player stakes money or something of value with an expectation of winning monetary rewards. Industry representatives argue that this broad definition could inadvertently include legitimate tournaments and e-sports competitions that are based on skill rather than chance.

Several petitions have challenged the law on grounds that it unfairly restricts skill-based gaming and professional tournaments, potentially stifling innovation and investment in India’s fast-growing digital gaming economy — a sector estimated to be worth over $3.5 billion and employing thousands of professionals across development, marketing, and event management.

Industry welcomes observation

Industry stakeholders have welcomed the Supreme Court’s remarks, calling them a positive signal for the gaming ecosystem.
“Recognising tournaments as skill-based competitions is crucial for protecting professional players, e-sports organisers, and developers,” said a Delhi-based gaming law expert. “The Court’s observation reaffirms the distinction between gambling and legitimate competitive play.”

Awaiting final clarity

While the Court’s comments offer reassurance, no formal exemption has yet been codified. The upcoming submission from the Centre is expected to outline how the government intends to regulate entry-fee-based competitions and whether they will be explicitly excluded from the ban.

Until then, legal uncertainty continues for platforms and players operating in the skill-based gaming space.