Section 13A Goa Public Gambling Act | Central Notification Mandatory for Amendment Enforcement: Bombay HC Strikes Down Ultra Vires Licensing Actions

The Bombay High Court has definitively held that the introduction of Section 13A to permit electronic amusement machines in five-star hotels in the Union Territory of Daman and Diu was never legally effective due to the absence of a mandatory Central Government notification. This ruling underscores the non-negotiable requirement of formal publication under the Constitution for delegated legislation to attain legal force.

Background & Facts

The Dispute

The dispute centers on whether the Petitioners, Delta Corp Limited and its Director, are entitled to a license to install electronic amusement/slot machines at their five-star hotel, ‘The Deltin’, in Daman. The Petitioners claim entitlement under Section 13A of the Goa, Daman and Diu Public Gambling Act, 1976, as amended by the Goa Public Gambling (Amendment) Act, 1992. The Respondents, the Union Territory Administration of Daman and Diu, reject this claim on the ground that the 1992 Amendment Act was never brought into force in Daman and Diu by the Central Government, as required by law.

Key Facts

• The Goa, Daman and Diu Public Gambling Act, 1976, originally prohibited all forms of public gambling, including slot machines.
• On 24.08.1992, the Goa Legislative Assembly enacted the Goa Public Gambling (Amendment) Act, 1992, introducing Section 13A to permit electronic amusement machines in five-star hotels in Goa.
• Section 1(2) of the 1992 Amendment Act stated: "It shall come into force at once." This applied only to the State of Goa.
• On 01.07.1998, the Central Government issued a notification under Section 6 of the Goa, Daman and Diu (Administration) Act, 1962, extending the 1992 Amendment Act to Daman and Diu, but with a critical modification: Section 1(2) was altered to read, "It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint."
• No such notification was ever issued by the Central Government to bring the 1992 Amendment Act into force in Daman and Diu.
• On 24.07.2007, the Petitioners applied to the Administrator of Daman and Diu for permission to install slot machines.
• On 12.10.2007, the Respondent No. 3 issued a letter stating that the UT had no objection to granting a license, provided the Petitioners completed all formalities within three years.
• On 05.02.2008, the UT Administration published Rules for licensing slot machines, with a preamble stating the Rules were issued "in exercise of the powers conferred by Section 13A... as in force in the UT of Daman and Diu."
• On 28.04.2014, the UT Administration withdrew the 2008 Rules.
• On 14.03.2014, the Petitioners submitted a formal license application for 140 machines, citing the 2008 Rules and the 2007 letter.
• On 31.08.2018, the UT Administration rejected all pending applications for slot machine licenses, citing policy grounds.
• The Petitioners had invested over Rs. 450 crores in constructing ‘The Deltin Hotel’, completed by June 2010, relying on the 2007 assurance and 2008 Rules.

Procedural History

• 24.08.1992: Goa Public Gambling (Amendment) Act, 1992 enacted in Goa.
• 01.07.1998: Central Government extends 1992 Amendment Act to Daman and Diu, subject to future notification.
• 24.07.2007: Petitioners apply for license.
• 12.10.2007: UT issues no-objection letter with three-year compliance window.
• 05.02.2008: UT publishes licensing Rules under Section 13A.
• 14.03.2014: Petitioners submit formal license application.
• 28.04.2014: UT withdraws 2008 Rules.
• 31.08.2018: UT rejects all applications, including Petitioners’.
• 08.04.2026: Writ Petition No. 317 of 2019 reserved for judgment.
• 29.04.2026: Judgment pronounced dismissing the Petition.

The Parties' Positions

Petitioners: Argued that the 1998 notification, combined with the 2008 Rules and administrative conduct, established Section 13A as in force. They relied on the Administrator’s 2007 letter and 2008 Rules to justify their Rs. 450 crore investment. They invoked promissory estoppel and legitimate expectation.

Respondents: Contended that Section 13A never became operative in Daman and Diu because the Central Government never issued the required notification. The 2008 Rules were ultra vires and void ab initio. The 2014 withdrawal was merely a correction of an illegal act. The Administrator lacked authority to bind the UT to a promise based on a non-existent law.

Relief Sought

The Petitioners sought:

• A writ of mandamus directing the Respondents to issue a license for slot machines.
• Declaration that the 1992 Goa Amendment Act is in force in Daman and Diu.
• Declaration that the 2014 withdrawal notification is ultra vires and inapplicable to their application.
• In the alternative, quashing of the 31.08.2018 rejection letter.

The Legal Issue

The central question was whether Section 13A of the Goa Public Gambling (Amendment) Act, 1992, as extended to the Union Territory of Daman and Diu by the 1998 notification, became legally operative without a subsequent notification by the Central Government appointing a commencement date.

Arguments Presented

For the Petitioner

The Petitioners relied on the 1998 notification, the 2008 Rules, and the 2007 no-objection letter to argue that Section 13A was effectively in force. They contended that the Administrator, acting under Article 239 and Section 3(8)(b)(iii) of the General Clauses Act, had the authority to issue the 2008 Rules, which implicitly confirmed the Act’s applicability. They cited Uttam Bala Ravankar, Punjab Tin Supply Co., and Sushil Flour Dal & Oil Mills to support the Administrator’s delegated powers. They further argued that the 2008 Rules were validly issued and that their repeal under Section 6(c) of the General Clauses Act did not extinguish rights accrued before repeal. They invoked Motilal Padampat Sugar Mills, Manuelsons Hotels, and Brahmputra Metallics to assert that promissory estoppel and legitimate expectation bind the State when citizens act to their detriment on official assurances.

For the Respondent

The Respondents argued that the 1998 notification explicitly reserved the power to notify commencement to the Central Government alone. The absence of such a notification meant Section 13A never became law in Daman and Diu. They relied on Viraj Impex Pvt. Ltd. to assert that publication in the Official Gazette is a constitutional prerequisite for delegated legislation to take effect. They distinguished Uttam Bala Ravankar and others, noting those cases involved statutes where the Administrator was expressly empowered. They cited Hero Motocorp and Lalit Sehgal to argue that the State cannot be estopped from changing policy in public interest, especially where the underlying law never existed. They emphasized that Section 22 of the General Clauses Act rendered the 2008 Rules invalid, as they were issued before the parent Act commenced. They further noted that the 2022 Dadra and Nagar Haveli and Daman and Diu Public Gambling Act, which replaced the 1976 Act, does not include Section 13A, making any license illegal as of today.

The Court's Analysis

The Court undertook a meticulous analysis of statutory interpretation, constitutional principles, and administrative law doctrines. It began by affirming that the 1992 Amendment Act, though enacted by the Goa Legislature, was not automatically applicable to Daman and Diu. The 1998 notification extended it conditionally, with a clear stipulation that it would come into force only upon a notification by the Central Government. The Court emphasized that this was not a mere procedural formality but a substantive constitutional requirement.

"The requirement of publication in the Gazette, therefore, serves a dual constitutional purpose i.e. (a) it ensures accessibility and notice to those governed by the law, and (b) it ensures accountability and solemnity in the exercise of delegated legislative power."

The Court held that the 2008 Rules, despite their preamble stating that Section 13A was "in force," could not validate an unenacted law. The Rules derived their authority from the parent Act, which had never commenced. The Court rejected the Petitioners’ reliance on Viraj Impex as distinguishable, noting that the judgment’s core principle - strict compliance with prescribed modes of publication - applied squarely here.

The Court further examined Section 3(8)(b)(iii) of the General Clauses Act, which defines "Central Government" in relation to a Union Territory as the Administrator acting within the scope of authority conferred under Article 239. The Court found that the Administrator’s powers are not co-extensive with those of the Central Government unless expressly conferred. The Court contrasted the 1998 notification with other statutes - such as the Dadra and Nagar Haveli Tenancy Regulation, 2023 - where the Legislature explicitly empowered the Administrator to notify commencement. The absence of such language in the 1998 notification was decisive.

Regarding promissory estoppel and legitimate expectation, the Court acknowledged the principles but held they could not override the absence of a valid legal framework. The Court cited Motilal Padampat Sugar Mills and Hero Motocorp to affirm that while the State may be bound by promises, such obligations yield to public policy and the rule of law. The Court found that the 2014 withdrawal reflected a legitimate policy decision to preserve Daman and Diu’s cultural and environmental integrity. The three-year window in the 2007 letter had expired, and the 2014 application was filed after the legal basis for the promise had ceased to exist.

Finally, the Court noted that the Dadra and Nagar Haveli and Daman and Diu Public Gambling Act, 1976, as amended in 2022, does not contain Section 13A. Thus, even if the Petitioners’ claims had merit historically, they are now barred by the current law.

The Verdict

The Petition was dismissed. The Court held that Section 13A of the Goa Public Gambling (Amendment) Act, 1992, was never brought into force in the Union Territory of Daman and Diu due to the absence of a notification by the Central Government. The 2008 Rules were ultra vires and void ab initio. The 2014 withdrawal was lawful. The Petitioners’ claims based on promissory estoppel and legitimate expectation were rejected as they could not override the absence of a valid legal basis. The Court further held that as of 20.04.2022, the operation of slot machines in Daman and Diu is prohibited under the applicable law, rendering any license application illegal. No writ of mandamus could be issued to compel an act contrary to existing law.

What This Means For Similar Cases

Legal Validity Requires Formal Publication

• Practitioners must verify whether delegated legislation has been formally notified in the Official Gazette as required by the parent statute.
• Administrative conduct, including letters or rules, cannot substitute for statutory commencement.
• Any reliance on unofficial assurances must be accompanied by proof of statutory authority.

Promissory Estoppel Has Limits Against Public Policy

• The doctrine of promissory estoppel cannot be invoked to enforce rights based on a law that never came into force.
• Courts will not compel the State to honor promises that conflict with public interest or statutory illegality.
• Investment reliance alone, however substantial, does not create a legal right if the underlying legal basis is non-existent.

Administrator’s Powers Are Limited by Express Delegation

• The Administrator of a Union Territory acts only within the scope of authority expressly conferred.
• General clauses like Section 3(8)(b)(iii) of the General Clauses Act do not automatically confer legislative powers unless the parent statute permits it.
• When statutes distinguish between "Central Government" and "Administrator," courts will strictly enforce that distinction.