Transaction in Bitcoin under IT scanner for tax evasion

Bitcoin Value Jumps 15 Times In A Year For Which Bank FD May Take 40 Years Mutual Funds 20

In wake of the massive bitcoin rally, Income Tax (I-T) Department, in an apparent precursor to a crackdown, conducted survey operations on Wednesday at major Bitcoin exchanges across the country on suspicion of alleged tax evasion, official sources said.

"Though Bitcoin is a grey area in India (the RBI has not termed it as an illegal tender yet), the transactions in the currency have gone through the roof, from Rs 1,200 crore in the last financial year to '10,000 crore in the current financial year".

Thousands of transactions are taking place every day in unregulated cryptocurrency exchanges and the Income Tax Department has launched surveys in the cities of Delhi, Mumbai, Pune, Bengaluru and Hyderabad, spokeswoman Surbhi Ahluwalia said.

Press Trust of India reported that the survey is meant to gather evidence "to establish the identity of investors and traders, their transactions and related bank accounts", according to Bloomberg.

Since payments in Bitcoin can be made without banks and that too anonymously, it is also popular with criminals and others who want to handle money anonymously.

Government is planning to set up a panel to decide on bitcoin policy, ETNow reported on Monday quoting agencies.

"At least nine bitcoin exchanges have been raided since morning by sleuths from the Income Tax department".

However, despite the RBI refusal to give regulatory clearances, many leading Indian Bitcoin exchanges like Zebpay and Unocoin offers crypto coin trade, possiblly through online banking. Contrary to those claims, Reuters cites a tax department official as stating that the authority is investigating bitcoin exchanges to learn how investors are trading bitcoin on the exchanges with the intent to collect taxes.

The RBI has clearly stated it's not a legal currency, it has no backing of assets behind it and has warned against it. Though Bitcoin has slipped to $14000 levels within 24 hours after hitting a high of $17900, its enthusiasts are convinced this is just a blip in the story.



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