As of 2026, India’s Online Gaming Act, 2025, mainly punishes the people who run gambling websites and apps, not the players. Website owners can get up to 3 years in jail and pay ₹1 crore fine if caught for the first time.
The new law is different from before. It goes after the people making money from illegal gambling, not ordinary people who play.
But this doesn’t mean players are totally safe. You will find all the answers related to online gambling punishment in India below.
Punishment Under the Online Gaming Act, 2025
Here’s what happens to different people:
| Offense Type | First Offense | Repeat Offense |
|---|---|---|
| Running an illegal gambling website | Up to 3 years jail + ₹1 crore fine | Up to 5 years jail + ₹2 crore fine |
| Helping with payments | Up to 3 years jail + ₹1 crore fine | Up to 5 years jail + ₹2 crore fine |
| Advertising gambling sites | Up to 2 years jail + ₹50 lakh fine | More fine + jail |
Who this covers:
- Website owners: People who make or run gambling websites and apps
- Money people: Investors who put money into these businesses
- Payment helpers: Banks and apps that handle gambling money
- Advertisers: Those who promote gambling sites
Players don’t get the main punishment. The law purposely doesn’t send regular users to jail.
The government knows most players aren’t criminals, they’re just users. Putting thousands of regular people in jail would be impossible.
Instead, it targets the people and companies making money from illegal gambling.
Source: PROGA 2025
Is There Any Punishment for Players Under This Act?
The central law doesn’t send people to prison just for playing on gambling sites. But players can still face problems:
- Bank account frozen: Your bank can lock your account if it sees gambling transactions
- Wallet blocked: Apps like Paytm or PhonePe might block your account
- Websites blocked: The government can tell internet companies to block gambling sites
- Money lost: Money you put on illegal sites can be taken away, and you probably won’t get it back
These aren’t jail punishments, but they still hurt. If your account gets frozen or your winnings disappear, it will be very hard or impossible to withdraw money from an online casino or gambling site.
Is Online Gambling Illegal in India?
India’s law system lets each state make its own rules about gambling. The central government can make general rules, but each state can be stricter or more relaxed.
Central rules: The Online Gaming Act, 2025, applies to all of India. It tells us what counts as illegal gambling and what happens to people who break the rules.
State rules: Each state can make tougher rules if it wants. Some states say no to all online gambling. Others allow certain types if they follow the rules.
There is no single “yes or no” answer for all of India. Many states have said no to online gambling completely.
In states that haven’t banned it, you still can’t use unlicensed websites or play money games based on luck.
So whether it’s legal depends on where you live and what you’re playing.
State-Wise Punishment for Online Gambling in India
Even with the central law, states can make stricter rules. Some states don’t allow any online gambling at all. Others allow it if you follow certain rules.
Here’s how different states handle it:
| State | What’s Allowed | Player Risk |
|---|---|---|
| Telangana | Completely banned | Can face legal trouble |
| Andhra Pradesh | Fully Prohibited | High |
| Tamil Nadu | Strict ban on real-money gaming | High |
| Goa | Legal in regulated formats | Low |
| Sikkim | Licensed betting allowed | Low |
| Daman | Regulated casinos allowed | Low |
Goa, Sikkim, and Daman are some states where casinos are legal, but with certain rules.
In banned states, even players can face trouble. The central law doesn’t jail players, but state laws can give fines or start legal cases.
If you live in a state that has completely banned it, you should assume that any online gambling can cause legal and financial problems, as you cannot even play online casino anonymously anymore in India.
Tax Penalties on Online Gambling in India
Even if you don’t face criminal charges, you still have to pay taxes. India’s tax rules treat gambling winnings as income. It doesn’t matter if the website is legal, illegal, Indian, or foreign.
| Type | Tax You Pay |
|---|---|
| Money you bet | 28% GST |
| Money you win | 30% TDS |
| Not reporting it | Tax notice + penalty |
28% tax on what you bet: Every time you place a bet, you pay 28% tax on the whole amount, not just what you win. This makes gambling expensive even before you know if you’ll win or lose.
30% tax on what you win: If you win, 30% gets automatically taken from your profit. Licensed platforms do this automatically. On illegal sites, you’re supposed to report it and pay it yourself.
Not reporting leads to trouble: If you don’t tell the tax department about gambling income, they can send you notices, ask for back taxes, and charge penalties. The government can see your bank transactions and track big amounts going to gambling sites.
Even the Online casino winnings are taxable in India. This isn’t just a threat. Taxes are one of the most actively checked parts of gambling in India. Even if you avoid legal trouble, not paying taxes can cause serious money problems.
Source: TDS Rates
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Conclusion: Punishment Is Imprisonment For Running, Funding And Promoting Gambling In India
India’s online gambling laws have changed a lot with the Online Gaming Act, 2025. If you run, fund, or promote an illegal gambling site, you face jail time and fines.
But players aren’t completely safe. State laws still matter. In places like Telangana or Andhra Pradesh, even players can get fined or face legal action.
The government wants to shut down illegal gambling by going after the people running it, but if you get caught in the middle, getting your money back or avoiding penalties is nearly impossible.
FAQs
Website owners get up to 3 years in jail and pay ₹1 crore fine the first time. Players don’t go to jail under the 2025 Act but can have their accounts frozen, money taken away, and face tax penalties. Some states can fine players too.
Online gambling by itself isn’t called a cybercrime. But running an illegal gambling website can be treated as a cybercrime if it involves cheating, money laundering, or unauthorized payment handling.
Most gambling charges under the Online Gaming Act, 2025 are bailable, which means you can pay to get out of jail while your case continues. Serious cases with big operations might have stricter bail rules.
The Online Gaming Act, 2025, punishes the owners of illegal websites. Payment processors and advertisers also face jail and fines. Players don’t go to jail under this law.
It depends on your state. Some states like Goa and Sikkim allow regulated online gambling. Others like Telangana, Andhra Pradesh, and Tamil Nadu have banned it completely.
