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LegalKart has an inhouse team of editors who research on the most relevant topics and write articles which can help understand the issue in a simple and easy manner. LegalKart aims to simplify law and make legal accessible to every Indian.

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Are online casino games legal in India?
Cyber Crime/Online Fraud

Are online casino games legal in India?

Casino websites on the internet have been around for a while. They enable casino enthusiasts from around the world to enjoy their preferred games. More importantly, they work in several jurisdictions and take care of each client individually.

One of their best features is that the majority of them are compatible with mobile devices, allowing players to play their favorite games while on the go. On websites Indian players may locate both seasoned online casinos and up-and-coming ones that are trying to establish themselves. For a while now, the situation in India has been changing. The nation has strong regulations regarding both online gambling and gaming in general.

Indian Scenario

India's laws are quite complicated, which is one of their drawbacks. Online sports betting is prohibited in several states, but it is not expressly prohibited by federal laws. A rut existed in the gambling environment for some time. In some states, it was legal to play at casinos, but not at online gambling sites. By 2022, Goa, Daman, and Sikkim were the only Indian states to have legalized online gambling due to advancements in legislation and the passage of new laws.

Also ReadAre online casino games legal in India? 

A lottery that accepts all Indian players is also permitted by the state of Sikkim. Indians must rely on foreign corporations to supply them with online casino games because they are unable to create their own online casino brand. Additionally, any business or operator that chooses to run in one of these states must provide Rupees as a payment option. Therefore, Indians can play at online casinos in the aforementioned states, but only on those sites that are provided by offshore operators.

In India, there are various specific gambling regulations. The Public Gambling Act of 1867 is the most significant of these. Operating a public gambling establishment or allowing gambling in any public area are both prohibited under this law. This law continues to apply to all types of gaming, including online gambling. In theory, you ought to be able to do this without facing any legal repercussions. However, if you are found gambling online, you can face legal action under the Public Gambling Act.

Also readIs Online Gambling in India Legal

The Information Technology Act of 2000 is a further regulation that you should be aware of. The use of the internet for gambling is now illegal as a result of this law. Therefore, if you are detected gambling online, you could face legal consequences.

International operators manage reputable online casinos with presences in India, including 10Cric, LeoVegas, Casumo, ComeOn!, and PureWin. Law in India does not apply to them. It is technically outside of India when players gamble real money on them. That such casinos must accept payments in Indian Rupees may be their only legal requirement.

The legality of Online Casino Games

Less is known about the legality of online casino games. Although there is no explicit rule that forbids them, if you are found gambling online you may face legal action under the Public Gambling Act. One of the most well-liked online games in India is poker. Poker, which is regarded as a game of skill, is not particularly covered by Indian gambling regulations.

You need to be able to play poker online without worrying about the law as a result. However, if you are detected playing poker online, you can face legal action under the Public Gambling Act. Fantasy sports are permitted in India because they aren't viewed as gambling. Additionally, skill-based games like online poker are permitted in India.

What to check while playing online casino in India

You must keep a few things in mind if you choose to play online in India.

  • Use only reputable and trusted gambling websites

You want to avoid becoming involved in one of the many scams that are out there. Therefore, be sure only to use trustworthy and trusted gambling sites. Use the websites where you can access payment options. Online casinos have more information about the Best Payment Methods.

  • Read the Laws

As explained, if you are caught playing online poker, you can face legal action under the Public Gambling Act. As a result, before you start gambling online, you must be aware of the regulations in India governing gaming.

  • Avoid using your personal information carelessly.

You have to give personal information when you play online poker. To only respectable and trusted websites, be careful to submit this information.

  • Play responsibly.

While gambling can be fun, it can also become addicting. So always play responsibly and never stake more than you can afford to lose.

Conclusion

The legitimacy of online casinos in India is still a matter of some debate. Several laws in India deal with gambling, but none of them directly include internet casinos. This implies that, in theory, there shouldn't be any legal repercussions for engaging in the online casinos. However, if you are found gambling online, you can face legal action under the Public Gambling Act. Therefore, if you choose to bet online in India, be careful only to utilize reputed, trustworthy gambling sites, be aware of the rules, and exercise caution when providing personal information.

Tax Exemptions for Startups Explained: Eligibility and Incentives
Startup

Tax Exemptions for Startups Explained: Eligibility and Incentives

The Government of India launched the Startup Scheme with the primary objectives of fostering new business ventures, generating jobs, and generating income. The network of interactions between individuals, groups, and their surroundings is often covered by this startup ecosystem. These connections not only boost the current companies but also aid to develop new ones that have the potential to become successful businesses.

Also read: Startup Due Diligence explained

However, businesses that receive a Startup Recognition Certificate from the Department for Promotion of Industry and Internal Trade (DPIIT) are entitled to various benefits, the biggest of which are tax exemption and incentives.

 

Shri Narendra Modi, the Prime Minister of India, unveiled some ambitious plans to improve the startup ecosystem in his nation. The PM mentioned the Startup India initiative while promoting the startup philosophy. The initiative is designed to meet the needs of struggling business owners and motivate them to operate in a more practical way. Notably, new startup tax advantages and exemptions were covered in a separate section of the Budget 2016. The government wants to stimulate the economy by supporting technological advancements and consumer-focused enterprises.

What is a Start-up?

The Startup India action plan defines a "startup" as an individual entity that must be registered with the Government of India (no earlier than 5 years) and has an annual turnover of less than 25 crores in any financial year. It will operate in the field of development and create products for the benefit of society using innovation and technology.

Eligibility Requirements for Indian Startups

For Indian startups, there are a few requirements for qualifying that will guarantee the best possible level of cooperation with the Indian government. The startup must meet the following criteria in order to be eligible:

  • Funded by a business incubator which is funded by the GOI and works on any Government project

  • Recommended and Certified with the help of a proper format provided by SIPP (Startups Intellectual Property Protection)

  • Funded by investors that are registered with SEBI. some prominent investors are Angel network, Private equity fund, Incubation fund

  • Funded by GOI for promotion on any innovative technology

  • Patent granted via Indian Patent and Trademark from the respective regional office

  • A spitted or reconstructed business shall not be considered as a startup company

Tax exemption and incentives

Only startups who qualify for the Startup India program are granted tax exemptions:

Income tax exemption for a period of 3 consecutive years - The Startups that are formed after April 2016 are entitled for a tax rebate of up to 100% on the profits they produce for a period of three consecutive years in a block of & years under section 80 IAC of the Income Tax Act after receiving approval for tax exemption. It should be emphasized that such an entity must not have exceeded the 25 crores in turnover in any one financial year.

Also Read: Procedure, Document Checklist And Costs For Incorporation Of A Private Limited Company

Tax exemption on capital gains - Startups are exempt from taxation under Section 54EE of the Income Tax Act. This exemption relates to the tax on long-term capital gain and is applicable if any LTCG is realized and if all or a portion of that LTCG is invested in a fund that has been approved by the Central Government within six months of the asset's transfer date. If these two requirements are not met, the authority may revoke the exemption. The maximum investment amount in such an asset is Rs. 50 lakhs, and that amount must stay invested for a continuous period of 3 years.

 

Tax exemption on investments above fair market value - The government has exempted eligible start-ups from paying the tax on investments that exceed fair market value. Such investments may be made by a variety of parties, including angel investors, venture capitalists, friends and family, incubators, and others who invest money over fair market value.

 

Tax exemption to individual/HUF on investment of long-term capital gain in equity shares of eligible startups U/S 54GB - According to Section 54GB of the Income Tax Act, the government permits an exemption from taxation on long-term capital gains resulting from the sale of any residential property, provided that the gains are invested in MSME businesses as defined by the Micro, Small and Medium Enterprises Act of 2006 as well as qualifying startups. As a result, if an individual or HUF sells a residential property and uses the capital gains to purchase 50% or more of the equity shares of eligible startups, long-term capital gains tax will not apply as long as the shares are not sold or transferred within five years of the date of acquisition or purchase.

Also Read: Private Limited company

Set off carry forward losses and capital gains allowed in case of a change in shareholding pattern - Losses can be set off and carried forward only in relation to qualified startups where the shareholders have held those shares from the final day of the year in which the loss occurred to the final day of the year in which the loss is to be carried forward.

Conclusion

The government hopes to create a better ecosystem for new businesses and entrepreneurship with these tax exemptions for Startup India. The three-year tax exemption has sparked some interest, so Indian businesspeople should not really worry about the future and should feel free to take market risks. The government will offer all forms of assistance and support to startups that meet the aforementioned eligibility requirements.

Legal Compliances Checklist for Startups in India
Startup

Legal Compliances Checklist for Startups in India

The growth of start-ups in India has been impressive over the past years, making the Indian ecosystem conducive to them. The government of India announced an initiative – Start Up India - with regard to the same, which aimed at focussing on simplification and handling, funding support and incentives, and industry-academia partnership and incubation. The Nasscom Tech Start-up Report 2020–21 states that India has 38 unicorn companies or businesses valued at more than $1 billion. The start-ups in the Indian ecosystem have to meet with the set compliances to establish themselves. Out of this, there are certain legal requirements that start-ups are bound to comply with. These compliances are discussed below briefly:

Also ReadProcedure, Document Checklist And Costs For Incorporation Of A Private Limited Company

 

  1. Identification of business organisation structure: When starting a business, one should create a separate legal entity under which they will operate. It is the most important item on the legal checklist for start-ups in India.  Private Limited Companies, Limited Liability Partnerships, One Person Companies, Sole Proprietorship Firms, and Partnership Firms are the six main legal entities recognised in India. A start-up can opt for any according to the business structure it wants to establish.

  2. Registration: The two most crucial considerations for registering a start-up are as follows:  The start-up must be incorporated before registering with the "Start-up India Program," which is the second step. A start-up's incorporation includes obtaining a Directory Identity Number and a Digital Signature Certificate. By enrolling online, you can receive this recognition from the Department for Promotion and Industry and Internal Trade (DPIIT). The platform aims to encourage innovation in the nation by giving businesses access to a range of financial incentives and advantages like tax exemptions.

  3. Obtaining Licences: It's crucial to understand that these licences are necessary for businesses to function lawfully and that they must be obtained. Every business organisation has different compliances to make. A business may be subject to legal penalties, fines, or other consequences if it fails to secure the licences necessary to operate in its industry. For example, a restaurant business will want a Certificate of Environmental Clearance, a Food Security Licence, and a Prevention of Food Adulteration Act Certificate, while an e-commerce start-up will require service tax and VAT registration.

  4. Company Law Compliances: Meetings with board members, filling out crucial documents, auditing data, and producing reports are all things that a registered company must adhere to. They can be listed as:

  • Annual-General Meeting

  • Board Meetings

  • Appointment of Auditor

  • Director’s Report

  • Maintenance of statutory registers

  • Circulation of Financial Statement

  1. Taxation Compliances: The two types of taxes are taxes, both direct (Income Tax) and indirect (GST, Excise duty, Customs duty, etc.) In India, taxes are imposed according to nature and company operations. Here are several tax benefits provided to start-ups for their efficient growth while they are still in their nascent stage.

  • Three-year tax holiday in a block of seven years

  • Exemption from tax on long-term capital gains

  • Tax exemptions on investments above the fair market value

  • Tax exemptions to individual/HUF on LTCG from equity shareholding

  • GST based compliance

  1. IPR Compliances: Start-ups place a high value on originality, creativity, and uniqueness as the foundation of their success. They establish a company with the intention of introducing the world to a brand-new good, service, or method. Protecting the intellectual property rights necessary for growing their firm is vital for entrepreneurs. 

Also Read: How Can You Form A Company In USA From India?

Start-ups have a number of options for safeguarding these assets, including non-disclosure agreements, copyrights, trademarks, and patents.

  1. Labour Law Compliances: Start-ups must abide by the labour laws that come with opening a real firm. Rules like the Minimum Wage, Maternity Leave, or Protection Against Sexual Harassment in the Workplace, these laws are designed to shield employees from the possible exploitation of their employers. Additionally, they serve as a tool for holding both parties responsible for their conduct.

  2. Event-based compliances: Some are related to particular occasions or industries, such as compliance with FEMA for start-ups with FDI or Customs law for businesses who import or export. When a start-up deals with potentially hazardous goods or processes, environmental law clearance is required, whereas when it interacts with real estate, RERA approval and other compliance with property laws are required. Mergers and acquisitions or large transactions that would significantly harm competition in India would require clearance under the Competition Law.

  3. Contractual Obligations: Every business has agreements in place with various parties who play a role in how the firm operates, such as clients, workers, or vendors, through contracts.

Also Read: Startup Due Diligence explained

Any organisation must adhere to its regulatory requirements; the first step to ensure smooth operation is to comprehend and follow the applicable laws. To start a firm, every beginning entrepreneur must be familiar with all applicable regulations. One of the best ways to ensure that the business is always safe and avoids legal issues and implications is to hire an expert legal counsel who can advise, supervise, and maintain legal records.

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