BUSINESS
The transaction is likewise suspect as
nobody can tell what consideration was
given because of the currency received.
What does Indian Law say about such
Virtual Currencies? Virtual Currencies or
cryptocurrencies are commonly seen as
pieces of software and therefore classify
as an asset under the Sale of Goods Act,
1930.
As being goods, GST on the services
provided by Miners will be applicable to
them. In budget 2018, it has been
cleared by Mr Arun Jaitely that crypto
currencies like bitcoin and others will not
be accepted as legal tender in India
although these can be defined as crypto
assets and shall be held as assets by an
individual. Recently at the beginning of
April 2018, Reserve bank of India has
given a recommendation report with
immediate action prohibiting banks and
agencies under RBI Act 2017(amended)
for accommodating any buying and
selling transactions for crypto currencies.
Any cryptocurrencies obtained by a
resident in India would thus be regulated
by the Foreign Exchange Management
Act, 1999 as an import of goods in this
country. India has allowed the trading of
BitCoin in Special Exchanges with inte-
grated safeguards because of tax evasion
or money laundering activities and
enforcement of Know Your Client (KYC)
norms. Almost all the exchanges are on
the self-regulatory system rather than any
government law regarding regulations.
There is an urgent requirement of guide-
lines for these currencies in favour as due
to uncontrollable factor as it will be very
difficult to stop channelization of money
from India to counties like Dubai, Uk
where they welcome blockchain and
cryptocurrency projects.