Legality

Legality

This opinion is drafted in relation to the Skilled based Gaming Application, “GOLD11”, owned and operated by M/S SANDHU SOFTWARE TECHNOLOGIES, PRIVATE LIMITED constituted under the Companies Act, 2013 with tha registered office address at Block no 5, NRI Colony, Mariya Road, Doraha, Payal, Ludhiana, Ludhiana- 141416, Punjab. “GOLD11” is engaged in the business of development and running of skill-based Gaming Applications. An Application is developed which can be downloaded from their official website or any other listing
Sources which will be used by customers to access and avail the services of the platform. In order To conduct the operations of the Skill Based gaming Application – “GOLD11”, there is a need for Payment Gateway Services for which Our Firm’s services have called upon to provide a legal opinion in this relation. On the basis of the information received, we hereby offer the following
opinion in relation to the Skill based Gaming Application “GOLD11”andthePayment Gateway

Services:

  1. The legality of Skill based Gaming Applications in India:
    The Supreme Court of India has in the past couple of Years upheld the legality of Skill based Gaming Applications in India while dismissing challenges to Orders passed by the various High Courts namely Punjab& Haryana, Rajasthan, etc. However, the Supreme Court of India has clearly upheld the legality in the cases of State of Andhra Pradesh V. K Satyanarayana and KR Lakshmananv. State of Tamil Nadu has held that a game in which success depends predominantly upon the superior knowledge, training, attention, experience, and adroitness of the player shall be classified as a game of skill. The Court has also relied on State of Bombay V. R.M.D Chamarbaugwala in which the Apex Court had said that there might be an element of chance in the result of the game however, if a game is played with certain skill and strategy, it cannot be considered as a game of chance.
    Thus, the legal position as far as Skill-based Gaming Applications are concerned, they are Allowed to operate in India in accordance with the law laid down.
  2. Payment Gateway Services Related Opinion
    Reserve Bank of India (hereinafter RBI) Authorization to be checked – At the outset, the most important consideration while choosing a relevant Payment Gateway service provider is whether they have been registered with the RBI or not. It is mandatory for Payment Gateways to be registered with the RBI as per the guidelines issued by the body in relation to Payment Aggregators and Payment Gateways

    Third-Party Solution Providers and Ease of Integration – The Payment Gateway Service providers are mostly third-party solution providers who will integrate their solution with the developed online solution of the merchant i.e., in this case, “GOLD 11”. It is important to consider the seamless integration of the two solutions to ensure Smooth accessibility and functionality for the consumers which can make a difference In terms of the outreach of the Skill-based Gaming Application.

    Contract between the Payment Gateway Service Provider and Merchant becomes crucial – whenever a Merchant comes into business with a Payment Gateway Service provider, the contract between the two parties serves as a crucial point to determine the
    rights and liabilities between the parties in case any dispute arises. This contract is also the focal point of any determination of damages between the parties in case the need arises. Thus, navigating through the contract comprehensively is crucial Guidelines on Regulation of Payment Aggregators and Payment Gateways *Z/ is suggested in this regard , that the Contract should be carefully vetted and Perused be for e finalising the relationship between the parties to ensure protection of rights and liabilities.

    General Practice is that Payment Gateways are required to protect the Merchants from Chargeback and Frauds -To simplify this, it is important to understand the primary role a Payment Gateway plays in relation to the verification of consumer card details that
    are not accessible to the Merchant. The Payment Gateway Service provider fulfils this role and communicates with the Bank and relevant authorities to cross-check the details and prevent Fraud and Chargebacks. Chargeback is a dispute against a particular
    transaction raised by the cardholder (end-user) and reported to their card issuing bank. A chargeback is a provision by bank sand card networks such as Visa& MasterCard to protect buyers from unauthorized or fraudulent payments. Once the cardholder files a
    complaint, the bank reports the same to the Payment Gateway Service provider and initiates an investigative procedure. *In this regard, it is important to communicate with Payment Gateway Service providers in advance before setting up the relationship to understand their Chargeback and Fraud detection procedures to safeguard the interests of the Merchant.

    Encryption of Information and Liability for such information – Another very important function of the Payment Gateway Service provider is to protect and secure the transaction for the consumer. An important feature and need of such Payment Gateway Service providers is to ensure the encryption of sensitive data such as Credit Card/ Debit Card details or any other payment details that need to be protected. Consumers transact through these platforms with the confidence of data protection and encryption. *In this regard, it is crucial for the Merchant to clearly understand the encryption Policy of the Payment Gateway Service provider and also their data sharing policy to protect its interests. A discussion in advance regarding the encryption practices and clarity over the liabilities in case of a data breach is essential for the Merchant to secure their business. Alt is suggested in this regard, that the Merchant follows the settled practice by Developed brands in this business arena. Merchants mostly through their User Terms and Conditions disclose that any dispute arising out oftransaction7paymentthrough the Payment Gateway Service provider will be dealt with by the User and third party (ie. the Payment Gateway Service provider in this case) only. It means that the
    Merchant absolves itself of the liability for any problems arising out of the usage of the Payment Gateway Service provider. The liability rests with the service provider And a clear attribution of such liability before finalizing the relationship is essential.

    Payment Processing Fees and Multi-Currency Support – In this case, generally the type of business operated and the type of transactions decide the payment processing fees charged by the Payment Gateway Service provider. Hence it becomes one of the most crucial factors for picking up the ideal payment gateway for Skill-based Gaming Applications. This Payment processing fee is how the Payment Gateway Service providers earn in their line of business so it will vary with different providers. Another important consideration for the Merchant can be the multi-currency support provided by the service provider. Alt is advisable in this regard that the Merchant is well versed with the Payment Processing fees policies of the service provider to have a transparent relationship and also ensure the prevention of any monetary loss or damage to the Merchant’s business. Selection of the Payment Gateway Service provider is only advisable after perusing the processing fee practices of the service provider.

    Customer Support and Merchant Dashboard for transparency between the two parties is crucial – It is important for the Merchant to consider Payment Gateway Service providers who come with 24×7 (support@gold11.co.in) customer support or at least reliable customer support as it is crucial in resolving consumer issues as and when they arise. The interests of the Merchants are directly dependent on the customer support response veness of the Payment Gateway Service provider as it will impact the business reputation of the Merchant. In addition this is a comprehensive merchant dashboard is important as it will ensure transparency between the Merchant and the Payment Gateway service provider. *It is advisable to address the merchant dashboard issue prior to finalising the relationship with the Payment Gateway Service provider as it will aid and assist the Merchant to access records and maintain transparency and also be crucial in case of any dispute with the Payment Gateway service provider in the course of the relationship.
  3. Intellectual Property-related opinion
    The Intellectual Property Rights of the online solution developed by the Merchant or Licensor for operating the business should rest with the Merchant or the Licensor (as the case may be) to avoid any dispute at a later stage and also disclose the same in the Terms and Conditions clearly and unequivocally for Users and all third party’s knowledge. In case the other party does not hold any Intellectual Property Rights at the current stage, the merchant can ask the party to acquire such Intellectual Property Rights in their property in order to get clarity of the rightfully protected Intellectual property of the service receiver.
  4. Eligibility Criteria and User Terms and Conditions
    It is important to issue a clear and unequivocal Disclaimer on the first-time use of the Skill-based Gaming Application that clarifies the eligibility criteria to use the application. It is important to clearly communicate that any person abovetheageof18years with a valid Email address and Mobile number will be allowed to access the application. It is also important to clearly restrict the usage of Paid versions of the application in States like Andhra Pradesh, Assam ,Nagaland, Odisha, Sikkim, or Telangana in accordance with the laws prevailing in these Indian states. *It is advisable in this regard, to have carefully drafted and vetted User terms and conditions that the consumers will accept before the usage of the Skill-based Gaming Application to ensure that all relevant information is disclosed in accordance with the law.
  5. Conclusion
    We believe in lieu of the documents perused and the information provided, the Skill based Sports Gaming “GOLD 11” can operate as a Skill based Sports Gaming platfom subject to the compliance of Minimum age, Intellectual Property Rights law in accordance with the Delhi High Court and Supreme Court judgments as mentioned above, in accordance with the state legislations and restrictions. It is reiterated that any contract between “GOLD 11” nd the Payment Gateway Service provider should be carefuly
    vetted and assessed to ensure protection against Rights and Liabilities in the case of transaction 5 Digital Collectibles PTE Ltd. & Ors. v. Gaiactus Funware Pvt. Ltd. & Anr. (CS (COMM) No. 108/2023) dispute or data breach before initiating a contractual relationship between the parties thereto.

Thank you for choosing Gold11!