India’s High Court Delays Challenge to Online Gaming Ban

India’s highest court has postponed hearing a constitutional challenge to the country’s sweeping new ban on real-money online gaming (RMG), prolonging uncertainty for an industry once valued at more than Rs230 billion (US$2.75 billion).

On Thursday, Chief Justice Surya Kant deferred an appeal filed by Head Digital Works (HDW), operator of the A23 Rummy platform, announcing that the matter would “likely” be taken up by a three-judge bench in January 2026. Lawyers for several gaming firms urged the court to fast-track proceedings, citing significant financial losses and widespread job cuts. Kant declined, stating, “Everything is shut down.… We are listing in January. That is what I am promising.”

The delay extends the legal and regulatory limbo triggered by the Promotion and Regulation of Online Gaming Act (PROGA), passed in August with minimal debate or consultation. The law imposes a blanket ban on all money-based online games and related services, making no distinction between games of skill and games of chance. Operators say this approach disregards long-standing legal precedents that treated skill-based games differently from gambling.

Industry Pushback and Accusations of ‘Paternalism

HDW and other RMG operators have argued that the new legislation amounts to state overreach. A23, in its filing, described PROGA as the “product of state paternalism,” asserting that it violates constitutional protections for trade and commerce. Industry groups say the ban has forced platforms to halt operations overnight, triggering large-scale layoffs and asset write-downs exceeding US$840 million.

Critics also contend that the prohibition ignores the potential for regulated frameworks that could mitigate consumer harm while allowing the sector to function legally. Lawmakers and advocates who support the ban frame the legislation as essential to protecting vulnerable communities. They argue that the explosive growth of online gaming—with millions participating in fantasy sports, card games and betting-adjacent platforms—has outpaced consumer safeguards.

The Centre for the Promotion and Regulation of Online Gaming has linked the industry’s “unchecked expansion” to financial fraud, money laundering, tax evasion and even terrorism financing. Lok Sabha member Bansuri Swaraj welcomed the new law, writing in The Week that PROGA “unmasked the wolf for what it is,” characterizing RMG as a corrosive force that exploited legal ambiguity for years. The ban, she argued, prevents companies from “hiding behind the fig leaf of ‘skill’.”

Players Shift to Offshore Apps

Despite the law’s stated aim of protecting consumers, early data suggests that the ban may be driving users toward offshore platforms with little to no oversight. A survey cited by the Economic Times found that before PROGA, only 3.4% of respondents spent more than two hours on offshore gaming sites. After the ban, that number jumped to 44%, with users reporting higher-frequency play sessions. The survey also found that 93.7% of users considered offshore platforms’ deposit and withdrawal processes “easy or very easy,” potentially facilitating repeated, high-frequency engagement throughout the day.

Industry leaders say this trend undermines the government’s consumer-protection rationale. Jaya Chahar, founder and CEO of JCDC Sports, warned that PROGA “pushes fan engagement away from regulated Indian platforms into unregulated offshore spaces, which defeats the very intent of consumer protection.”

Everything is shut down.… We are listing in January. That is what I am promising.

Economic Fallout Continues

The economic impact has been swift. By mid-November, banned RMG operators reported asset impairments totaling more than US$840 million. Industry associations estimate that roughly 7,000 workers have already lost their jobs, with more layoffs expected as companies wind down operations or relocate abroad.

With the challenge now pushed into early 2026, the sector faces at least another year of legal ambiguity. Operators, investors and employees will watch closely as the case returns to the Supreme Court—where the debate over paternalism, public safety and economic freedom is set to intensify.