The Hindu : Kerala News : Fake lotteries of other States flood the market

Online edition of India's National Newspaper
Wednesday, May 11, 2005

Kerala

Kerala

Fake lotteries of other States flood the market

C. Maya

No mechanism for checking violations of Lotteries Act

THIRUVANANTHAPURAM: : Fake lotteries of other States have begun to flood the market again no sooner than the State Government's new legislation, revoking the ban on lotteries in the State, has been enacted.

However, the State Lotteries Directorate is helpless to do anything about this as the new law has stripped the department of all powers to monitor and regulate the functioning of the lotteries of other States that are marketed in Kerala.

The blanket ban on all lotteries in the State, including Kerala State Lotteries, announced by the Government early this year, was the culmination of long-standing legal wrangles between the State Government and the operators of paper and on-line lotteries of other States, who were allegedly marketing lotteries in gross violation of many provisions of the Central Lotteries (Regulation) Act, 1998.

Even as the first draw (of `Periyar' scheme) of the re-launched Kerala State Lotteries is to be held on May 10, several schemes of the paper lotteries of the Bhutan Government has arrived in the market, the draws of which are to be held on Monday.

"The Taxes Secretary had written twice last year to the Centre that the lotteries of the Bhutan Government were being operated in gross violation of several provisions in Section 4 of the Central Lotteries Act, 1998. The same lotteries have now come back in the State and yet we can do nothing to stop them," a senior official at the State Lotteries Directorate said.

The new Kerala Taxes Act, 2005 formulated by the State Government to collect taxes on paper lotteries, clearly defines paper lotteries as "any lottery that is not operated on-line, but are conducted as per the conditions outlined in Section 4 of the Lotteries (Regulation) Act, 1998."

"How can the Sales Tax department collect tax from lottery operators who are running illegal lotteries and allow them to operate from the State? The permission given to Bhutan lotteries to operate here is in itself a violation of law. The situation now is such that anyone can remit Rs. 2.5 lakhs as tax and make huge profits from the market," he pointed out.

The legislation enacted by the State Government to re-launch lotteries, speaks only about checking sales tax violations. If earlier, the State Lotteries Directorate had the powers to check illegal players in the market, the department now has little else to do except operate the State Lotteries.

Sources at the Directorate expressed apprehension that several other big operators who are running similar lotteries in the names of North Eastern States would now re-enter the market. Last year, tickets of illegal lotteries worth Rs. 150 crores had been seized in raids conducted by the department with the help of police in various districts.

"All the tickets seized were those of lotteries run in the name of various Governments. Fake lotteries of the Arunachal Pradesh Government itself accounted for Rs. 100 crores, after which Arunachal had stopped its lotteries. Now that the State has lifted its ban on lotteries, all these illegal lotteries would soon be revived," a department official said.

With no mechanism for checking violations of the Lotteries Act, the State is once again set to become the playing field for illegal lottery operators, it is feared.

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