Legal Opinion

Legal Opinion

We have received certain legal queries with respect to an online game "Rich Pockets Technosoft Private limited " in pursuance of the same, a list of documents /details was acquired relevant information. The present legal opinion is being provided on the basis of information received regarding the privacy policy, terms of service of the game, and applicable laws on online gaming.

Brief Facts

Rich Pockets Technosoft Private Limited (Hereinafter referred to as the Company) is a company registered under the provisions of the Companies Act, 2013. They have come up with an initiative namely "Rich Pockets " It's an online gaming platform wherein players are offered promotional games, practice games, cash games, and other non-cash games on the Application.

Company Details:

As the company was incorporated on 17/06/2022 as the company is in active condition the CIN Number of the company is U72900 DL2022 PTC400182
The registered address of the company is House No 32, Block – A, Pocket – 6, Rohini Sector 18 New Delhi, North Delhi – 110089.
The Permanent Account Number of the company is AADCW2881K and the GST Number of the Company is 07AADCW2881K2ZW.

1. Nature of the transaction.

The nature of the game is traditional rummy/poker/fantasies game like the chase, carom, etc. As per the information received, it is a skill-based game are required to pay attention every detail for a consistent hardworking on

i) Modus Operandi of the game and complete description

The player muse registers himself/herself through the Application before accessing Services or playing the games. The registration can be done by clicking on the "Register" section in the Application and the registration can be proceeded with in accordance with the steps directed therein. In order to register, the player must create his/her unique login name and password after submission of certain information as may be required therein. Further, the player may be asked to submit certain documents for verification of his/her age and authenticity of other details as part of the KYC process. The player must register himself/herself only once with correct credentials and can't make more than one account on the Application, that is to say, the player shall access the Services or play the games only through one account. The player is also prohibited from using the account of someone else to access the Service or play the games. In the event, the player is found to accessing the Services or playing the game(s) through someone else's account, the player may barred by the company, for present and future, from accessing the Services or playing the games.

Once the registration is done, the Company offers promotional 8ames, practice games, cash games, and other non-cash games on the Applications. Cash games are such games that require participants to make certain payments and/or to maintain a certain minimum cash balance in their account to participate. Non-cash games are such games that does not require participants to contribute or make any payments or to maintain a certain minimum cash balance in their account to participate. The 13 cards are dealt to a player, he/she needs to arrange the cards according to the strategy and game plan. The opponents may discard a card required by him but getting it timely is that what matter player needs to play accordingly and must find ways to get the required cards before anyone does to complete a round with a win in online rummy.

Once the registration is done, the Company offers promotional 8ames, practice games, cash games and other non-cash games on the Applications. The cash games are such games that require participants to make certain payments and/or to maintain a certain minimum cash balance in their account to participate. Non-cash games are such games that does not require participants to contribute or make any payments or to maintain a certain minimum cash balance in their account to participate. The 13 cards are dealt to a player, he/she needs to arrange the cards according to the strategy and game plan. The opponents may discard a card required by him but getting it timely is that what matters. A player needs to play accordingly and must find ways to get the required cards before anyone does to complete a round with a win in online rummy.

ii) Routing of prize money.

The player adds cash to the gaming account it in case he/she chooses to pay cash chooses on the application. The said cash account constitutes the following heads.

a) Deposits: Deposits are such payments that the payer deposit in the gaming account and participate in the Cash Game with the object of earning winnings that are more than the deposits so made.

b) Winnings: Winnings are such amount that are won by the player. All the winnings are credited by the Company in the gaming account. The Deposits made by the player in his/her account can be withdrawn by the player by making a specific request in this behalf, subject to completion of KYC. The company processes a withdrawal request via NEFT- Electronic Transfer after KYC and withdrawal verification has been successfully completed. The company always attempt to process the withdrawal through the mode of transfer selected by the player. lt is pertinent to note that the company deducts TDS as well and doesn't process the request on bank holidays, although, the policy of the Company is silent about routing of money through verified bank, thus, more information shall be required to reach on any conclusion regarding the same.

iii) Platform for Operation-App/Website.

All products and/or services relating to the Company through its mobile application, namely, Rich Pockets .

iv) States that it's not under the category of gambling as per any act of the states and the money so generated is used for illegal purposes, charity, money laundering etc.

There are certain states wherein online gaming is prohibited which includes online rummy also. Indian states of Assam, Odisha, Sikkim, Nagaland, Kerala and Telangana are deemed as "Excluded Territories" owing to their laws against online games. Therefore, the Company in compliance with such applicable laws, offer its Cash Games and the Application in all Indian states except "Excluded Territories". Accordingly, players in "Excluded Territories" are explicitly prohibited form the accessing the Services and playing the Cash Games. The Company do not accept the registration as registered users on Application from persons in "Excluded Territories" for allowing to play Cash Games.

The Company has strict policy against illegal use of funds, in-fact, depositing and withdrawing money in the player's account without playing any, or playing Cash Games inadequately, shall be inconsistent to its fair play deposit and withdrawal policy. Such deposits and withdrawals in a consecutive or frequent manner are deemed as money laundering actions. Any violation in this regard, if proved upon the investigation is liable for penalty and ban from accessing the services while confiscation of funds in credit in the player's account, if any.

Additionally, the Company may initiate appropriate legal action against such player, and may, report the relevant authority with respect to the unlawful conduct.

v) None of the Court's Order has been violated in such cases/states where there is no such.

The Supreme Court of India in the case of "State of Andhra Pradesh v. K.Satyanarayana (AIR 1968 SC 825)" ruled that rummy is a game of skill. However, this decision comes with a disclaimer. There should not be any evidence of gambling involved in any other way-game owners should not make profits or against from rummy and games should not be played for stakes. The disclaimer means that several online rummy games cannot benefit from the Supreme Court's decision since they potentially involve profits for participants, who play for real money, and for game owners.

In landmark Supreme Court case State of Bombay v/s RMD Chamarbaugwala (AIR 1957 SC 699), and RMD Chamarbaygwala v/s Union of India (A1'R 1957 SC d28), it was held that competitions that involved substantial skill we were not gambling activities. Such competitions were business activies, the protection of which was guaranteed under article 19(1)(g) of the constitution.

Supreme Court's decision dated 27 September 2021 in Head Digital works Private Lifemited and Ors v/s State of Kerala and Ors (WP (C) No. 7785), declared a notification issued under the Kerala Gaming Act, 1960, which imposed as ban on "online rummy when played for stakes" as being arbitrary, illegal and violations of fundamental rights under articles 14 and 19(1) (g) of the constitution.

Therefore, playing games of skill (online or offline) is judicially protected and cannot be viewed as gambling or gaming activities.

Although, there is a recent judgment "Play Games 24X7 Private Limited and Ors. v. Ramachandran K. and Ors. t207 9 4 N£ £ J42J 'by Kerala High Court which held that Rummy circle (Online rummy game) did not amount to gambling. It is pertinent to note that the Company has gaming policy of "Excluded Territory" which means player from certain states where online gaming is illegal are prohibited to play " Rich Pockets".

Hence, the laws pertaining to legality of online rummy gaming are ambiguous, although, the Company has tried to comply with all the applicable laws.

vi) Name/Eligibility/other eligibility criteria’s of the player is verified.

The player must register himself/herself through the Application before accessing Service or playing the games. The player is asked submit certain details like age, residence etc. to complete the KYC process. Moreover, the player must be above 18 to play the game. Thus, the Company ensures that every single player is properly verified.

vii) Certificates from gaming federations/approvals/KYC/MOA/AOA/COI of the Company are duly obtained for such operations

As per the information received from the Company and applicable laws no specific approval or certificate is required to operate online games. Although, "Rich Pockets "is being operated by a registered company having its AoA, Col and other relevant documents.

viii) Privacy Policy + User Conduct + Third Party site services and conducts.

The Company has robust "privacy policy" and "terms of service” which covers all the applicable laws including information Technology Act 2000 along with user conduct. However, the Application may contain information about third parties and may comprise of hyperlinks within them. The player shall use or access such third party content or hyperlink at your sole risk. The company is not responsible in any way for the implied warranty about the quality, integrity or accuracy of such third party content. Moreover, any third party content appearing on the application shall not be deemed as endorsement towards such third-party content by the Company.

ix) Are there any legal charges against the company & its directors?

The conclusive information can't be provided about the pending litigation against the Company or its directors without proper legal due diligence. Although, as such no pending litigation was found in preliminary research.

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