Gambling/wagering of almost any form is illegal in India. I'm sure Goa is an exception state that does allow it in certain forms. This has been specified in The Public Gambling act of 1867. Certain games categorized as 'Skill' based like 'Rummy' and betting in 'Horse racing' are allowed as certain level of skill is involved in it. But yes, Bitcoin gambling may be illegal unless it's in the form of rummy.
Like you said later in the post, its not illegal in all forms. Skill based in legal in some parts of the country like Bangalore/Goa / Kolkatta etc. With bitcoins, the government is not going to be able to find out if you gamble with it. And there is literally no interest in the government, that I have seen towards gamblers gambling with bitcoin, so should be all good for now.
