Lotteries Regulation Act, 1998 Section 2(b) states that the lucky draws which are conducted to promote digital transactions do not come under the category of lottery and are thus are not banned.

2)Under the Lotteries Regulation Act, of 1988, the state governments have been authorised by the central government to make their laws related to the game. As a result, some states have banned it and some still consider it legal.

3) Section 2(b) defines lottery as “a scheme, in whatever form and by whatever name called, for distribution of prizes by lot or chance to those persons participating in the chances of a prize by purchasing tickets”. 

4) The definition clearly indicates that three elements are essential for a scheme to be defined as a lottery: chance, consideration (for purchasing tickets) and prize or reward.

4) Section 2(1)(r) of the Consumer Protection Act defines unfair trade practice. Under this provision conducting any lottery or contests whether of skill or chance to promote  the sale, use or supply of any goods or for the provision of any service is forbidden

5) Under the Tamil Nadu Prize Scheme Prohibition Act, offering prizes by way of draw of lots to purchasers of goods or products from shops or malls is prohibited. Section 2(b) of the Act defines a ‘prize scheme’ to mean any scheme where a reward in cash or kind is given for purchase of goods.

If what you state is a modified form of a lottery then: Under the Lotteries Regulation Act, of 1988, the state governments have been authorised by the central government to make their laws related to the game. As a result, some states have banned it and some still consider it legal. However, there is no such restriction on the online form of lottery.

Lucky draws are not illegal in India because the lucky draw scheme which is included in the Lotteries Regulation Act,1998 has to stay within the given parameters, and most lucky draws which are organized by the governments do not require a ticket purchase and the participants can directly come and try their luck, and thus this does not account to gambling.Online lucky draws require the payment of a small amount which is usually collected by companies like Mastercard or Rupay, or by other banks used for payment and hence the government on their side does not charge anything and offer prizes gratuitously. Therefore it is very clear that a lucky draw is very different from a lottery, and this would not fall under the category of gambling.

And for making it legalised the lucky draw rules in india plays a crucial role for it that if there is something is upto lucky draw that should be as per the rules mentioned in lucky draw rules in india.

The Section 2(1)(r) Consumer Protection Act, 1986 also prohibits any kind of unfair trade practice  which includes “conducting any lottery or contests whether skill or chance to promote the sale, use or supply of any goods or for the provision of any service.”  The NITI Aayog has clarified this too as offering lucky draws to promote digital transactions does not include any service and the customer does not pay anything for getting the reward. These kinds of lucky draws usually include small cash back offers for payment by digital means.

And thus the lucky draw scheme stays out of the ambit of consumer protection laws as well as the Lottery Regulation Act.

It is not game of chance but game of skill .it would not be considered as lottery 

2) 

you have to obtain licence under provisions of prize competition act

2) licence is required in case prize money offered is more than rs 1,000

You can create online lucky draw games website as per the Constitution of India under Article 19[1](g).

Except few states (five-Six States) in India won't allow to play the games its banned as per state laws. Rest of the India it can be played.

Dear client, Under the Lotteries Regulation Act, of 1988, the state governments have been authorised by the central government to make their laws related to the game. As a result, some states have banned it and some still consider it legal. However, there is no such restriction on the online form of lottery.

- As per Supreme Court , A ‘game of skill’ means , the game in which , the success primarily depends on the superior knowledge, training, attention, experience, and adroitness of the player , like golf, chess etc. 

- Further, the Supreme Court has held that unless it is purely a game of chance, it is not illegal.

- Further, the Games which require skill up to a certain degree are not illegal.

- Hence, the second option of asking question before entering into draw of prize will considered a game of skill , and then it will not illegal . 

Lottery is banned in india in any manner under both the circumstances. It is illegal. 

Section 5 of Prize competition Act, 1955 states:

No person shall promote or conduct any prize competition or competitions in which the total value of the prize or prizes (whether in cash or otherwise) to be offered in any month exceeds one thousand rupees; and in every prize competition, the number of entries shall not exceed two thousand.

11. Penalty for other offences in connection with prize competitions.―If any person with a view to the promotion or conduct of any prize competition except in accordance with the provisions of a licence under this Act or in contravention of the provisions of this Act or in connection with any prize competition promoted or conducted except in accordance with such provisions―
(a) prints or publishes any ticket, coupon or other document for use in the prize competition; or
(b) sells or distributes or offers or advertises for sale or distribution, or has in his possession for the purpose of sale or distribution any ticket, coupon or other document for use in the prize competition; or
(c) prints, publishes or distributes, or has in his possession for the purpose of publication or distribution,
(i) any advertisement of the prize competition, or
(ii) any list (whether complete or not) of prize winners in the prize competition, or
(iii) any such matter descriptive of, or otherwise relating to, the prize competition as is
calculated to act as an inducement to persons to participate in that prize competition or any other prize competition ; or
(d) brings, or invites any person to send, into the territories to which this Act extends, for the purpose of sale or distribution, any ticket, coupon or other document for use in, or any advertisement of, the prize competition ; or
(e) sends, or attempts to send, out of the territories to which this Act extends any money or
valuable thing received in respect of the sale or distribution of any ticket, coupon or other document for use in the prize competition ; or
(f) uses any premises, or causes or knowingly permits any premises to be used, for purposes connected with the promotion or conduct of the prize competition ; or
(g) causes or procures or attempts to procure any person to do any of the above-mentioned acts, he shall be punishable with imprisonment for a term which may extend to three months, or with fine which may extend to five hundred rupees, or with both.

You need to seek RBI permission if you need to legally proceed in said business