The State of Telangana officially separated from Andhra Pradesh in June 2014. The city of Hyderabad, one of the major horse racing centres in the country, will remain the de jure capital of both states until 2024. After that, it will be fully under the jurisdiction of the Telangana state.
Gambling in Telangana is still governed by the Andhra Pradesh Gaming Act of 1974. This means that gambling in most forms is illegal. The only exceptions are the state-run lottery, horse racing, and rummy. Any violation of the Act leads to arrests and fines although they are negligible in many cases. However, the penalties for repeat offenders are much more serious.
As Hyderabad is the capital, tote and pool betting on horse racing remain legal. Taxes from gambling add millions of dollars every year to the exchequer while other forms of betting considered illegal under the Act also continue to proliferate.
Games like Teen Patti or 3 Card Indian Flush, cockfights, and pigeon racing are popular in the state. Gambling dens in Hyderabad and smaller cities and town flourish. Recently, the state has taken an initiative to crack down on online gambling which had been gaining popularity among users of mobile phones and other devices.
Though it is very young, the state of Telangana is a major force in the $150 billion Indian gambling market. It is the 12th most populous state with the 8th highest GDP in the country.
Unfortunately, Telangana also has one of the most hostile sets of laws against all forms of gambling, including online betting. As its primary law, the state uses the Public Gambling Act, 1867, an archaic law at the Central level. That law prohibits all games of chance, except lotteries all over India.
Horse racing is considered a game of skill, along with rummy, and is exempted according to several Supreme Court rulings over the years. The state now collects taxes from horse racing clubs under the provisions of the Andhra Pradesh (Telangana Area) Horse Racing and Betting Tax (Amendment) Act 1986.
Soon after the formation of the state in August 2014, Telangana’s Chief Minister, K. Chandrashekhar Rao announced a crackdown on prominent gambling clubs, especially in the city of Hyderabad. Many of these well-known clubs are located in areas such as Begumpet, Banjara Hills, Lower Tank Bund, Bowenpally, and Abids, to name a few.
Aside from the Public Gambling Act, 1867, Telangana also uses the Andhra Pradesh Gaming Act of 1974. It defines gambling as an act of betting or wagering for money and prohibits the use of land-based premises for making profits or gains on gambling. It is not necessary to prove that an individual found at a gaming house was placing wagers in order to prosecute and convict them. However, the fine remains as small as $1.50 or one month’s imprisonment under the Indian Penal Code (45 of 1860).
After cracking down on gambling clubs, the state government took decisive action against online gambling in 2017. In June that year, the state legislature passed an ordinance amending the Gaming Act to ban playing card games like rummy online. Both players and the sites who host these games can be prosecuted if caught by the Cyber Police.
This was the second ordnance on the issue passed by the state and was called Telangana Gaming (Second Amendment) Ordinance, 2017. Another similar ordinance passed by the state had been challenged in the High Court by various betting companies. The government reaffirmed its authority to ban playing rummy online, regardless of it being a game of skill.
Under the new amendment, players caught by the Cyber Police can expect a fine of Rs 5000 and up to one year in prison. In the case of repeat offenders, the quantum of punishment will be drastically increased.
As mentioned earlier, Telangana retains Hyderabad as the capital, which is why betting on horse races is legal. The racecourse at Malakpet run by the Hyderabad Race Club (HRC) is among the major racing centres in the country with legal off course betting.
Keeping in view the case of Dr K. R. Lakshmanan Vs State of Tamil Nadu in which the Supreme Court ruled that horse racing is a game of skill, the Hyderabad Race Club has been permitted by the government to run off course betting centres.
The racing club hosts a number of elite races that include the Deccan Derby, President of India Gold Cup, and Nizam’s Gold Cup. The state collects taxes from the club under The Andhra Pradesh (Telangana Area) Horse Racing And Betting Tax Regulation 1358 F, which is over $1 million per year in addition to over quarter million in taxes to the Central Government as well.
The law is one of the most outdated and even prompted the Hyderabad High Court to advise the state government to bring in new tax legislation and plug any loopholes in the law.
Punters have several off-course tote centres operated by the Hyderabad Race Club to choose from. This includes centres in Hyderabad, Warangal, and Nizamabad, to name a few. These centres sell totalizer tickets for major racing centres throughout the country including Mumbai, Pune, and Bangalore, to name a few.
The new Telangana government took a hostile view towards horse betting as well. In 2015, the Chief Minister made public his government’s aim to take over the Malakpet land and build schools for minorities there.
The government wants to shift racing and betting activities outside the city and also crackdown on illegal bookies who evade taxes in a big way. But the process has stalled due to the inability to find alternative land, which would require one large parcel of 200 acres.
Since Hyderabad is the only race club in the country to own its racecourse lands, the government cannot evict it easily. If they want to forcibly take over the land, the state would have to pay huge compensation going into hundreds of crores.
As with every other state in the country, Telangana prohibits betting on cricket and other sports under the Andhra Pradesh Gaming Act of 1974. Cricket betting still remains popular, a multibillion-dollar industry where illegal bookmakers thrive. Major illegal betting rackets are busted on a regular basis.
In 2018, Hyderabad police arrested 11 individuals and seized Rs 44 lakhs in cash in a massive bust on IPL betting rackets. In many instances, only small-time players and individual punters are arrested, and the big sharks all escape.
Cricket betting rackets in Telangana use highly sophisticated and modern methods which make it harder for police to trace them. Bets on cricket matches are usually conducted over the phone and involve a well-networked set of individuals who accept wagers from punters. Several small kiosks and cigarette shops are also active participants in the business.
Any type of sports betting remains illegal in Telangana although there are several stakeholders who continue to urge the government to pass some form of legislation on sports betting given the number of people with disposable cash and the will to bet online.
Currently, online betting is illegal and punishable under the Public Gambling Act 1967 and the Indian Penal Code (IPC). The Information Technology Act 2000 considers online gambling a cybercrime although there are many loopholes.
The state of Andhra Pradesh has in the past considered the idea of setting up world-class casino gambling centres, especially in the port city of Vizag and nearby islands. But so far, the state of Telangana under the leadership of Chief Minister KCR has not shown any interest in promoting gambling or casinos.
Currently, only Goa and Sikkim have passed legislation that permits casinos to operate within their borders in India. No other state allows casinos or any sort of gambling establishments. Telangana also belongs to this group.
A lottery is one of the products that the Public Gambling Act of 1867 permits in India. However, the states are free to decide if they want to allow lotteries within their jurisdiction, under the Lotteries (Regulation) Act of 1998.
The state of Telangana has banned the running of lottery since its creation in 2014. In the past, lotteries were legally available in undivided Andhra Pradesh. The Bhagyalakshmi Lottery, now banned in Andhra, had the potential to bring in over $20 billion every year.
Other players like Playwin and the Essel Group have also been prohibited from operating online in the state. The state Human Rights Commission requested the Chief Secretary to impose a ban while a letter requesting the blocking of Playwin’s website was sent to the Director, Indian Computer Emergency Response Team (CERT-In).
Currently, all lotteries are deemed illegal in accordance with the Andhra Pradesh (Telangana Area) Lotteries Act, 1968.
As soon as the new Telangana state was formed, the government cracked down on all major card clubs and gambling establishments in the Hyderabad city limits. In the past, card clubs had flourished in the state of Andhra, where poker was considered a game of skill.
However, under the new state, clubs were faced with raids by the Police and all the big ones were closed down. Ten clubs, including Chiraan Fort, petitioned to the High Court to prevent police from interfering in the operation of card rooms on club premises where members play rummy with stakes.
The petitioners argued that in the case of Kishan Chander versus state of Madhya Pradesh the Supreme Court observed that rummy was a game of skill and not a game of chance, which made the closure of the card rooms illegal.
However, the legal counsel for Telangana’s home department cited a 2012 case in the Madras High Court, Director General of Police v. Mahalakshmi Cultural Association, where the judge ruled that the provisions of the Chennai Police Act were applicable when rummy is played with stakes. The police invoked the Hyderabad Gambling Act and shut down the card rooms.
In 2015, the Supreme Court closed that petition after the trial court acquitted the Mahalakshmi Cultural Association. As a result, the original decision by the Madras High Court on offline rummy was declared void. It has brought clarity on the issue of rummy as a game of skill in India.
While that decision did favour the rummy clubs, the Telangana government continues to crack down on rummy clubs. Only members at high-society clubs for the elite can play rummy on-premises. Other smaller clubs that host games for stakes are not allowed to operate legally.
As for other games like poker, legal establishments hosting games are unseen in Telangana. They are all 100% illegal. Players usually depend on home games at discreet venues for poker, involving friends and known acquaintances.
Nonetheless, rummy online remains to be one of the most wagered games of skill in India. But as already mentioned, all forms of online card games and casinos are fully banned in Telangana. The law is quite strictly enforced as well – ISPs usually block these betting sites in the state.