Lotteries (Regulation) Act 1998 and the Kerala Lottery

Bhagya Desk Results TeamPublished 4 Oct 2026

The Lotteries (Regulation) Act 1998 is the central law that lets a State Government run a lottery only on fixed conditions. It bans every other lottery by a state. The Kerala State Lottery runs under this Act and under Kerala’s own rules made under it.

What is the Lotteries (Regulation) Act 1998?

The Lotteries (Regulation) Act 1998 is Act No. 17 of 1998, passed by Parliament to regulate lotteries across India. It received assent on 7 July 1998. Section 1 says the Act is deemed in force from 2 October 1997.

The Act is short. It has 13 sections, and it extends to the whole of India. It replaced the Lotteries (Regulation) Ordinance 1998, which Section 13 repeals.

How does the Act define a lottery?

Section 2(b) defines a lottery as a scheme that gives prizes by lot or chance to ticket buyers. The name or form of the scheme does not matter. A paper ticket and a computer ticket both fall inside the definition.

Section 2(a) defines a bumper draw. It is a special draw held on a festival or special occasion. Its prize money is greater than that of an ordinary draw. Kerala’s Onam, Christmas-New Year and Pooja Bumpers are bumper draws in this sense.

What does Section 3 prohibit?

Section 3 says no State Government shall organise, conduct or promote any lottery, except as Section 4 allows. The ban is the starting point of the Act. Section 4 then lists the only conditions under which a state lottery is lawful.

What does Section 4 require of a state lottery?

Section 4 lets a State Government run a lottery only on 11 conditions, clauses (a) to (k). The conditions cover the prize, the ticket, the sale, the money, the draw and the number of draws.

Clause	What Section 4 says
4(a)	No prize on a pre-announced number or on a single digit
4(b)	The State prints the tickets with its imprint and logo, so the ticket is authentic
4(c)	The State sells tickets itself or through distributors or selling agents
4(d)	Sale proceeds go into the public account of the State
4(e)	The State itself conducts the draws
4(f)	Prize money not claimed in the prescribed time becomes the property of the State
4(g)	The draw takes place inside the State
4(h)	No lottery has more than one draw in a week
4(i)	Draws are held during hours prescribed by the State
4(j)	No more than six bumper draws of a lottery in a calendar year
4(k)	Any other condition prescribed by the Central Government

Clauses (h) and (j) shape the Kerala calendar most clearly. Each weekly lottery draws once a week. The bumper draws stay at six a year.

How does the Kerala lottery follow Section 4?

The Kerala lottery follows Section 4 through weekly draws, six bumpers, state-printed tickets and draws in Thiruvananthapuram. Each clause has a visible match in how the lottery works.

One draw a week: 7 weekly lotteries, one per day, each with a single weekly draw.
Six bumpers a year: Christmas-New Year, Summer, Vishu, Monsoon, Onam and Pooja.
Draw inside the State: draws at 3:00 PM at Gorky Bhavan, near Bakery Junction, Thiruvananthapuram.
State-printed tickets: tickets bear the State Government’s imprint and logo, under Rule 3 of the Kerala Rules.
Unclaimed prizes: money not claimed within 90 days of the draw stays with the Government.
No single-digit prize: the smallest weekly prize matches the last 4 digits of a ticket.

Kerala fills in the details through the Kerala Paper Lotteries (Regulation) Rules 2005. Section 12 gives each state this rule-making power. The state rules fix the claim period and the draw hours, as Section 12(2) lists.

Why can’t Kerala lottery tickets be sold online or across states?

Kerala tickets are sold only on paper, inside Kerala, because Kerala’s own rules forbid online and outside sale. The central Act allows paper or online lotteries. Kerala chose paper only.

The official Directorate FAQ gives 3 reasons. Online lottery was banned in Kerala by G.O.(P) No. 4/2005/TD of 13 January 2005. Only physical tickets are permitted for sale. No agent sells Kerala tickets outside the state, directly or indirectly.

The 2024 amendment to the Kerala Rules put this in rule text. Rule 6(2) bars selling Kerala tickets, their numbers or images through any phone, computer or social media. Only the original printed ticket is sold.

What does Section 5 allow other states to do?

Section 5 lets a State Government ban the sale of other states’ lottery tickets within its territory. A state with no lottery of its own uses this power to keep other states’ tickets out.

The agent agreement in Form III of the 2024 amendment carries this rule. Agents keep Kerala tickets out of states that run no lottery.

What do the Lotteries (Regulation) Rules 2010 add?

The Lotteries (Regulation) Rules 2010 are the Central Government’s rules under Section 11 of the Act. They were notified as G.S.R. 278(E) on 1 April 2010. They apply to every organising state, Kerala included.

Rule 3(1): a state runs a paper lottery, an online lottery or both.
Rule 3(2): the state notifies each lottery’s purpose, scope, limitation and methods in its Gazette.
Rule 3(3): the state announces 10 facts per lottery in advance, from ticket price to draw procedure.
Rule 3(6): no more than 24 draws a day per state, bumpers excluded.
Rule 3(7): no draw on a National Holiday.
Rule 3(8) and 3(9): ticket price of at least ₹2 and first prize of at least ₹10,000.
Rule 3(14): no prize based on a single, double or triple digit.
Rule 3(18): income tax is deducted at source, and prizes go to the winner’s bank account.

Kerala’s Gazette notifications follow Rule 3(3) line by line. The Karunya notification of 10 November 2025 is an example. It lists price, tickets printed, gross value and distributor. It then gives the prize structure, prize money, periodicity, venue and draw procedure.

What are the penalties under the Lotteries (Regulation) Act?

The Act punishes illegal lotteries with rigorous imprisonment of up to 2 years, a fine, or both. Section 7 sets the penalty. Section 8 makes every offence under the Act cognizable and non-bailable.

Section 7(1): the Head of a state department that runs a lottery against the Act.
Section 7(2): any other officer whose consent, connivance or neglect caused the breach.
Section 7(3): any agent, promoter or trader of an illegal lottery, and any seller or buyer of its tickets.
Section 9: a company and the persons in charge of it.

Section 7(3) reaches buyers too. Kerala’s FAQ applies it to 2-, 3- and 4-digit games run on Kerala results. These games are illegal in Kerala.

Who can ban a lottery under the Act?

The Central Government can prohibit a lottery that breaks Section 4 or Section 5. Section 6 gives this power. The order is published in the Official Gazette.

Rule 5 of the 2010 Rules sets the steps. A state reports the violation to the organising state and to the Centre. The organising state replies within 30 days. The Centre hears the organising state before it issues a Section 6 order.

Section 10 lets the Centre give directions to a state on carrying out the Act. Section 11 and Section 12 split the rule-making power between the Centre and the states.

Is a lottery legal in India?

Yes. A lottery run by a State Government under Section 4 is legal. A lottery run by any other person or body is not. Kerala’s 2024 Rule 4(2A) says no one organises or sells any lottery in Kerala except as the Government authorises.

Legality is decided state by state. A state lottery is lawful where it is sold. The state where the ticket is sold keeps the Section 5 power to ban it. Prize amounts for each Kerala lottery are listed on the Kerala lottery prize structure page.

Lotteries (Regulation) Act questions

In which year was the Lotteries (Regulation) Act passed?

In 1998. It is Act No. 17 of 1998, with assent on 7 July 1998. Section 1 deems it in force from 2 October 1997.

How many sections does the Lotteries (Regulation) Act 1998 have?

13 sections. They cover definitions, the ban, the conditions, state bans, central bans, penalties, offences, directions, rules and repeal.

What does Section 4 of the Lotteries Regulation Act say?

Section 4 lists the 11 conditions for a lawful state lottery. They include state-printed tickets, state-run draws, one draw a week and six bumpers a year.

What is the punishment under Section 7 of the Lotteries Act?

Rigorous imprisonment of up to 2 years, a fine, or both. Section 7(3) applies to agents, sellers and buyers of an illegal lottery.

How many bumper draws does the Act allow?

Six bumper draws of a lottery in a calendar year, under Section 4(j). Kerala runs six bumpers a year.

How many draws a week does a lottery get?

One. Section 4(h) says no lottery has more than one draw in a week. Kerala runs a separate lottery for each day.

Which rules did the Central Government make under the Act?

The Lotteries (Regulation) Rules 2010, notified as G.S.R. 278(E) on 1 April 2010. They set Gazette notices, draw limits and minimum prices.

Which Kerala rules are made under the 1998 Act?

The Kerala Paper Lotteries (Regulation) Rules 2005, made under Section 12. A 2024 amendment changed the claim period and the sale rules.

Why is the lottery banned in Tamil Nadu?

Section 5 lets any state ban the sale of other states’ lottery tickets inside its territory. A state that runs no lottery uses this power.

What is a bumper draw under the Act?

A special draw held on a festival or special occasion, with prize money greater than an ordinary draw. Section 2(a) gives the definition.

Who can stop a state lottery that breaks the Act?

The Central Government, by an order under Section 6 published in the Official Gazette. Rule 5 of the 2010 Rules sets the procedure.

Is an offence under the lottery act bailable?

No. Section 8 makes every offence under the Act cognizable and non-bailable.

Is the Kerala lottery legal under the 1998 Act?

Yes. The Government of Kerala runs it under Section 4. Each lottery is notified in the Gazette under the 2010 Rules.

Does the Act allow online lotteries?

Yes, for states that choose them. Rule 3(1) of the 2010 Rules allows paper, online or both. Kerala banned online lottery in 2005.

Is buying a ticket of an illegal lottery an offence?

Yes. Section 7(3) punishes anyone who purchases a ticket of a lottery run against the Act.

Related guides

Sources: Lotteries (Regulation) Act 1998 and Lotteries (Regulation) Rules 2010 (Indian Kanoon text); Kerala Paper Lotteries (Regulation) Amendment Rules 2024, S.R.O. No. 1197/2024; Directorate of State Lotteries FAQ; Karunya Gazette notification, 10 November 2025. This page describes the law. It is not legal advice. Unofficial site.