Taxing Lottery

Section 2(b) of The Lotteries (Regulation) Act, 1998 of the Act defines, ‘lottery’ means a scheme, in whatever form and by whatever name called, for distribution of prizes by lot or chance to those persons participating in the chances of a prize by purchasing tickets. State of Bombay v. R.M.D. Chamarbaugwala, AIR 1957 SC 699 had occasion to consider the nature of activities akin to lottery, betting and gambling. Sunrise Associates v. Govt. of NCT of Delhi, (2006) 5 SCC 603 has laid down that, lottery is an actionable claim. The observation cannot be said to be obiter dicta. We do not accept the submission, there is any hostile discrimination in taxing lottery, betting and gambling and not taxing other actionable claims.

Hon’ble Justice Ashok Bhushan, Skill Lotto Solutions v. Union of India, [Writ Petition (Civil) No. 961 of 2018].