Delhi HC Issues Notice To RBI Over Bitcoins; ED, CBDT Want Total Ban On Cryptocurrencies!
A bench of justices at Delhi HC has issued to a notice to RBI and Ministry of Finance and GST Council and sought their reply by May 24th.
The ongoing saga of cryptocurrencies and their legal stand in India has become interesting.
Acting on a petition, Delhi High Court has asked RBI over their decision to ban bitcoins and cryptocurrencies in banks.
Meanwhile, insider reports have come in, which claims that leading enforcement agencies in India want a complete ban on cryptocurrencies and bitcoins in India.
How will Govt. and RBI respond now?
Delhi HC Issues Notice To RBI Over Bitcoins!
On April 6th, in their first bi-monthly monetary policy for 2018, Reserve Bank of India had asked all banks and financial entities coming under their preview to completely ban all sort of bitcoin and cryptocurrency related transactions.
We had described this as the final nail in the coffin for crypto enthusiasts – If you are not allowed to transact using cryptocurrencies, then how will you trade and do business?
However, this ban has been now challenged by Kali Digital Ecosystems Pvt Ltd, which is a Gujarat based company, planning to launch their own crypto exchange.
As per the petition filed in Delhi HC, this company has claimed that they are planning to launch their own crypto exchange: ‘Coin Recoil’, in August.
All planning has been done, but RBI’s April 6th order is stopping them from launching their crypto idea. If banks refuse to deal with digital coins, how will they operate, they have asked the Court.
Accepting this plea, A bench of justices S Ravindra Bhat and A K Chawla at Delhi HC has issued to a notice to RBI and Ministry of Finance and GST Council and sought their reply by May 24th.
RBI order states: providing any service in relation to virtual currencies, including those of transfer or receipt of money in accounts relating to purchase or sale of virtual currencies”
Whereas the petitioners, Kali Digital, has claimed that this order is “arbitrary, unconstitutional and violative of the Constitution”.
Enforcement Agencies Want Total Ban On Crypto!
Meanwhile, leading enforcement agencies such as The Central Board of Direct Taxes and the Enforcement Directorate has strongly recommended a complete ban on all forms of cryptocurrency trading in India.
Representatives from these enforcement agencies are part of the Committee formed by Govt. of India to sort this issue.
This special committee is headed by Economic Affairs Secretary Subhash Garg. Securities and Exchange Board of India Chairman Ajay Tyagi along with Reserve Bank of India Deputy Governor BP Kanungo and representatives from CBDT and ED are part of this high-level committee.
As per ED and CBDT, cryptocurrencies are increasingly used for money laundering and terrorist activities, and a complete ban on them is necessary.
As per some analysts, instead of a complete ban, the Committee can recommend regulation of the same, which can ensure that no anti-national activities are carried over. After all, not everyone who is involved in the crypto trade is doing money laundering, they argue.
We will keep you updated, as we get more details on this issue.