JAGDISHCHAND vs DIRECTOR, SIKKIM STATE LOTTERY

WHETHER lottery ticket holders are within the ambit of the definition of a consumer under the Act ? WHETHER this beneficent jurisdiction is to be extended to such wagering transactions? This is the twin significant question in this complaint.

IN view of the pristinely legal question aforesaid the facts pale into insignificance. These may be noticed in their barest outline. Mr. Jagdish Chander had purchased a lottery ticket No. S.C.207197 of Sikkim Bharti lotteries at Pehowa. The draw of the State Lottery was held on the 12th of February, 1992 and the complainant was declared the winner of the first prize of Rs. 1,00,000/-. Thereafter on the 6th of March, 1992 the complainant completed all the necessary formalities and sent his claim for payment through the Canara Bank. There was apparent delay in finalising the payment to the complainant and he consequently preferred the present complaint on the 21st of December, 1992 claiming Rs.1,00,000/- against the first prize and curiously another rupees one lac. for the mental harassment caused due to non-payment, alongwith interest thereon.

During the course of hearing the complainant dropped the opposite party Nos. 2 & 5 from the array of the respondents and since no appearance was put in on behalf of the opposite party Nos. 1,3 &4 they were proceeded exparte. The complainant put in his own affidavit in support of his case and closed the same. In the said affidavit it is now admitted that the complainant had received Rs. 68,078/- on the 27th of January, 1993 as the prize money. 5.From the above it is manifest that all that now survives is the complainant''s claim of rupees one lac allegedly for mental harrassment, and interest for the delay and the payment of the prize money. 6. Though no appearance has been put in on behalf of the opposite parties, this Commission is obviously duty bound to first consider the crucial issue whether the relief claimed herein comes within the consumer jurisdiction. On be half of the complainant Mr. Ashish Kapoor, reliance has been primarily on AIR 1933 Madras 16 ''Universal Mutual Aid & Poor Houses Association Ltd. Madra v. A.D. Thoppa Naidu and Others'' and A.I.R. 1936 Madras 225 ''Sesha Ayyar v. Krishna Ayyar & Others'' and 1992 Consumer Protection Cases 747 ''Ved Parkash Sharma v. M/s Vimal Agencies & Anr.'' 7.Before adverting to the aforesaid precedents which were the sole sheet-anchor of the learned Counsel for the complainant, it is necessary to examine the matter on larger principle and on the relevant statutory provisions. On the two questions posed at the very outset one may first pointedly advert to the issue whether the beneficent consumer jurisdiction is to be extended to lotteries and whether they are wagering transaction. 8.Without slipping into the trap of the dictatorship of the dictation arises it is still necessary to advert to the true meaning of the word "lottery" as understood in common parlance. In Webster''s Dictionary, the following meaning is ascribed to the word ''Lottery'': "A scheme for the distribution of prizes by lot or chances, specially a scheme by which one or more prizes are distributed by chance among persons who have paid or promised a consideration for a chance to win them, usually as determined by the numbers on tickets as drawn from a lottery wheel."

Yet again in Murray''s Dictionary the following meaning is given : " An arrangement for distribution of prizes by chance among persons purchasing tickets." 9. It would be manifest from the ordinary meaning of the word ''lottery'' itself that it is one dependent purely upon chance in the fortitious mode of the draw of lots. There is not the least element of skill or judgment involved therein. It is dependent upon an uncertain event beyond the pale of predictability. It seems unnecessary to elaborate the matter because on the plain meaning of the word ''lottery'' it has clearly the hue of a gaming or wagering transaction. Nevethe less, one may not merely rest oneself on mere language alone because there is no dearth of judicial authority for the view that a lottery is essentially in the nature of a wager. Before adverting to other precedents, one may notice the observations of Venkataraman Rao, J. in ''Sesha Ayyar v. Krishna Ayyar'' (supra), which case as already noticed was primely relied upon by the learned Counsel for the appellant. Therein it has been observed as follows : "A lottery is a species of gaming or wagering and may be described as an agreement whereby a prize or prizes are to be awarded by drawing lots or any other chance method to one or more of the persons who risk the payment of money or other valuable consideration for the chance of winning a prize."

10.It is plain that the basic authority relied upon by the complainant seems to give the lie direct to his stand. In all fairness however, we must notice that there are observations in the said judgment trying to draw a thin line of distinction betwixt a wager and a lottery. There need be no quarrel with such a view because it is not necessary to hold that a lottery and a wager are synonymous terms or have an identical meaning. Indeed to use the well known terminology of logic, it may be said that all lotteries are wagers, but all wagers are not necessarily lotteries. 11.To hearken back a little, it deserves recalling that though the word ''wager'' has been repeatedly employed in Section 30 of the Indian Contract Act, same has not been precisely defined by the said statute. One has, therefore, necessarily turn to the judicial meaning ascribed thereto and one cannot do better then quoting the classic description thereof in the following words : "A wager consists in a promise to give money or money''s worth upon the determination or ascertainment of an uncertain events."

However, if a more elaborate exposition of its meaning was necessary, the same may be taken from the celebrated words of Hawkins, J. in the land mark case of ''Carlill v. Carbolic Smoke Ball Co.'' page 278: "A wagering contract is one by which two persons, professing to hold opposite views touching the issue of a future uncertain event, mutually agree that, dependent or the determination of that event, one shall win from the other, and that other shall pay or hand over to him, a sum of money or other stake; neither of the contracting parties having any other interest in that contract then the sum or stake he will so win or lose there being no other real consideration for the making of such contract by either of the parties."

Against the aforesaid back-drop, one must now turn to first Section 30 of the Contract Act and because of that inevitably to Section 294-A of the Indian Penal Code. For facility of reference, there may be quoted at the very out-set: Section 30: Agreement by way of wager void: Agreement by way of wager are void; and no suit shall be brought for recovering anything alleged to be won or any wager, or entrusted to any person to abide the result of any game or other uncertain event on which any wager is made. Exception in favour of certain prizes for horseracing : This Section shall not be deemed to render unlawful a subscription or contribution, or agreement to subscribe or contribute, made or entered into for or towards any plate, prize or sum of money, of the value or amount of five hundred rupees or upwards, to be awarded to the winner or winners of any horse race. Section 294-A of the Indian Penal Code not effected: Nothing in this section shall be deemed to legalize and any transaction connected with horse-racing, to which the provisions of Section 294-A of the Indian Penal Code apply." Section 294-A Keeping lottery office: Whoever keeps any office or place for the purpose of drawing any lottery not being as State lottery or a lottery authorised by the State Government, shall be punished with imprisonment of either description for a term which may extend to six months, or with fine, or with both. and whoever publishes any proposal to pay any sum or to deliver any goods, or to do or forbear doing anything for the benefit of any person, or any event or contingency relative or applicable to the drawing of any ticket lot, number or figure in any such lottery shall be punished with fine which may extend to one thousand rupees." 13. A bare reading of the aforesaid provisions would leave no manner of doubt that both the civil and the criminal law frown severely on lotteries. By virtue of Section 294-A running a lottery is a criminal offence punishable with imprisonment or fine barring the limited exception in favour of lotteries expressly authorised by a State Government. It needs no great erudition to hold that an Act which is either actually an offence or in any case akin to it, cannot possibly give rise to any civil or contractual rights either. It may well be that a mere purchase of a lottery ticket without more, may not come within the strict ambit of criminal liability. But nevertheless, such a lottery ticket can hardly clothe the holder with enforceable contractual rights. To use familiar terminology, the transaction may not be an offence or illegal, but it nevertheless is a void transaction. It is trite learning that gaming and wagering transactions which are the genus are not enforceable at law, and inevitably their species like lottery or other things akin thereto would equally be in the same category. 14. Apart from principle and the language of the statutory provisions, there is no dearth of authority on the point. Indeed the English law, which is the pre-curser of the Indian Statute and is primarily a judge-made law is replete with precedent on the point. However, it is not the provence of this judgment to burden it with English authorities and it suffices to remain nearer home. One need not go back any further than in ''Kamakshi Achari v. Appavu Pillai'' (1863) 1 M.H.C. 448 as follows: "Lotteries ordinarily understood are games of chance in which the event of either gain or loss of the absolute right to a prize or prizes by the person concerned is made wholly dependent upon the drawing or casting of lots and the necessary effect of which is to beget a spirit of speculation and gaming that is often productive of serious evils."

It would perhaps suffice to say that broadly the aforesaid view has held sway for more than a century and quarter till now. All that one may further recall is that even in the context of a Warloan lottery way back in the year 1918, it was held in ''Dorabji Tata v. Bance'' AIR 1918 (42) Bombay 67 : 41 I.C. 689'' that in the context of even a lottery authorised by the Government of India, the effect was that no prosecution would lie under the criminal law. But nevertheless, a sale or purchase of a ticket in such a lottery would still be a wagering contract under Section 30 of the Indian Contract Act and consequently wholly unenforceable. 16. Now once it is held that a lottery transaction is void and unenforceable under the Indian Contract Act. Can the position be in any way different in the consumer law? We are clear that it cannot possibly be so. It is somewhat elementary that the basic consumer rights stem from the contracts of sale and purchase of goods or a valid hiring of any services for consideration. If the very initial contract of such purchase or hiring is void inevitably no consequential rights can flow therefrom in the consumer field as well. It would be labouring the obvious to elaborate on this aspect because the matter seems self evident. 17. In the light of the somewhat exhaustive aforesaid discussion, the answer to the second question posed at the out-set has to be rendered in the negative. It is held that the beneficent consumer jurisdiction cannot be extended to lotteries and wagering transactions. 18. The aforesaid finding would in essence conclude the matter. However, assuming highest in the complainant''s favour that the lottery ticket still clothes him with some contractual rights, the question would still remain that whether such a ticket holder is consumer for the purpose of the Act. It is elementary that to enter the portals of the redressal agencies under the Act, the complainant must first show that he is a consumer. Obviously, herein no question of any buying of any goods or a defect therein arises to give the complainant any cause of action. The only question that tenuously remains is whether a lottery ticket holder has hired or availed of any services for consideration as now amended by the recent ordinance. Can it be said that the promoters of a lottery selling tickets are extending out any service within the meaning of the Act. The word ''service'' has been defined in Clause (o) of Sub-section (1) of Section 2. Though the definition is wide-ranging, one cannot see how a lottery would come either in the expressly enumerated services or even in the generic sense of the service of any description which is made available to potential users. Despite being pin-pointed, learned Counsel for the complainant could not even remotely cite chapter or verse or draw our attention to any principle or precedent (barring one noticed hereinafter) which would make the transaction as one extending out the services or the hiring thereof by any consumer. On the language of the Act and on principle, the matter indeed seems concluded against the complainant. 19. All that remains is the reliance of Mr. Ashish Kapoor on ''Ved Parkash Sharma v. M/s. Vimal Agencies & Another'' (supra). However, we are unable to see how this judgment in any way aids or advances the complainant''s case. Therein the complaint was dismissed by the National Commission. Mr. Kapoor had however, argued that the same had been entertained by the National Commission and it should be presumed that such a lis is within the ambit of the consumer jurisdiction. We do not think so. The reading of the brief order would show that the pointed issue before us was not even remotely raised and consequently not adjudicated upon. Equally the complaint was thrown out at the threshold on the preliminary question of the pecuniary jurisdiction. Far from aiding the stand of the complainant, the following observations in the order may well boomrang on his stand : "We are also of the opinion that there is no question of rendering of service as defined under the Consumer Protection Act by opposite party No.1. It is a mere case of placing an order for purchase of lottery ticket, which the opposite party No.l failed to comply."

20.It is true that the aforesaid has been only as a dictum without an indepth examination. Never the less, the said observation buttresses and goes in support of what we are inclined to hold after a perhaps prolix consideration of the issue in all its aspects and ramifications. 21. For the fore-going reasons, the answer to the first question is rendered in the negative and it is held that the lottery ticket holders are not within the ambit of the definition of a consumer under the Act. 22. Inevitably on the twin findings arrived at, in this order the complaint must fail on the threshold ground if its very maintainability. The same is consequently dismissed, but since no meaningful appearance was put in on behalf of the opposite party, we decline to burden the complainant with any costs. Complaint dismissed.