Disposing of petitions filed by state governments having divergent views about ban on lotteries, a division bench of Justice K Venkataswamy and Justice AP Mishra upheld the Constitutional validity of Lotteries (Regulation) Ordinance, 1997 and the Lotteries (Regulation) Act, 1998.

In its 134-page judgement, the bench said, ``decision to collect or not to collect revenue through state lotteries is exclusively within the policy decision of the state and for this, neither the Union nor Parliament interferes nor there is any indication under the Act.''

The court said, ``whenever a state decides to run or not to run its lotteries it is the state which has to decide as a public policy in the public interest.''

``Once such a decision is taken to have in itsstate lottery free zone, the entrustment of power by Parliament cannot be said to be ultra vires,'' the bench said upholding the Act which entrusted such power to state governments.

On the question of whether a state, while banning other state lotteries in its territory, could run its own lottery, the court accepted the suggestion of the Centre and said, ``state could exercise such discretion if it decides not to have any lottery within its territory including its own lottery.''

Thus, if a state decides to run its own lottery than it would not be able to prohibit other state lotteries from being sold in that state.

It was submitted by the north-eastern states, which garner substantial revenue by running their state lotteries in other states, that such a ban would badly affect their revenue.

The bench said, ``the act does not prohibit a state not to run its own lotteries. Such states can continue to have their own lotteries. Only where any state decides not to have any lottery, the territorial area ofsuch state is only curtailment.''