Three people have so far been arrested for money laundering, while four prosecution complaints have been filed before the Special PMLA Court
GST evasion worth INR 87.60 Cr by 12 crypto exchanges has been detected so far. A recovery to the tune of INR 110.97 Cr has been made
While a further probe is currently underway in eight cases related to GST evasion, four separate cases have been closed on the receipt of tax, interest and penalty
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In a written reply, the Minister of State (MoS) for Finance, Pankaj Chaudhary, on Monday (December 19) said that the Enforcement Directorate (ED) has so far seized INR 907.48 Cr in connection with various cases related to money laundering by crypto exchanges.
The minister pointed out that the ED was probing several cases related to crypto frauds. He added that three people have so far been arrested for money laundering. In addition, the authorities have also filed four prosecution complaints before the Special PMLA (Prevention of Money laundering Act, 2002) Court in the cases.
Pointing out WazirX, the MoS said that assets totalling nearly INR 290 Cr belonging to the crypto exchange have been seized under the FEMA.
“Further, under Foreign Exchange Management Act, 1999 (FEMA), assets amounting to INR 289.68 Cr have been seized under section 37A of FEMA and 01 (one) show cause notice to crypto exchange Zanmai Labs (WazirX)… and its director under FEMA for transactions involving crypto assets worth INR 2,790.74 Cr has also been issued,” the minister said.
Additionally, tax sleuths have so far detected Goods and Services Tax (GST) evasion worth INR 87.60 Cr by 12 crypto exchanges. The minister said that authorities have made a recovery of INR 110.97 Cr, including interest and penalty, in the evasion case.
While a further probe is currently underway in eight cases related to GST evasion, four separate cases have been closed on the receipt of tax, interest and penalty.
Reiterating its stance on crypto norms in the country, the government said that virtual digital assets were currently unregulated in the country. Noting that the government does not register crypto exchanges, the MoS observed that any legislation that seeks to regulate or ban cryptos could not be effective without any significant international collaboration.
Crypto Space In Upheaval
2022 turned out to be an absolute disruption for the crypto space in the country. The year began with apprehensions of a crypto winter and ended with a full-fledged meltdown after crypto exchange FTX collapsed.
From a regulatory perspective, the year also turned out to be a disaster for Indian exchanges. From 30% tax on crypto profits to 1% TDS on all crypto transactions, higher taxes on VDAs wreaked havoc for the industry as retail investors left in droves.
The year also saw enforcement agencies raiding offices and premises linked to many crypto exchanges, including WazirX and Coinswitch Kuber.
With transparency still not the norm among crypt exchanges, it remains to be seen what the next year holds for the industry. With much at stake, it looks like it could take a long time for cryptocurrencies to stabilise.
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