Supreme Court issues notice to RBI, Union of India and other government ministries and institutions in petition seeking ban on all cryptocurrencies like bitcoin in India
The Hon'ble Supreme Court of India on 13th November 2017 in a Writ (PIL) bearing W.P.(C) No. 1071/2017, titled as Siddharth Dalmia & Anr. Vs Union of India and Ors., filed against virtual currencies like Bitcoins, argued by Mr. Vijay Pal Dalmia, Advocate (petitioner-in-person), was pleased to issue notices to Union Of India, Ministry of Home Affairs, Reserve Bank of India, etc.
The order was passed by a Bench of Hon'ble Chief Justice Mr. Dipak Misra, Hon"ble Justice Mr. AM Khanwilkar and Hon"ble Justice Mr. D Y Chandrachud.
A copy of the writ may be downloaded from the following link: https://goo.gl/QvWvgr (PDF file)
The Writ Petition is filed in Public Interest under Article 32 of the Constitution of India for seeking issuance of directions to the Respondents to ban the sale and purchase of illegal cryptocurrencies or Decentralised Digital Currency or Virtual Currency (VCs), such as, Bitcoins, Litecoin (LTC), Dash, Bbqcoins, Dogecoins, Ripple etc., which are being traded openly and extensively within the knowledge and domain of the Government of India for a host of anti-national and illegal activities.
That in June 2017, the Petitioners herein, Mr. Vijay Pal Dalmia, Advocate along with Mr. Siddharth Dalmia, an engineer and a law student at Jindal global Law School, filed the Public Interest Litigation on the instant subject by way of a Writ Petition (Civil) No.000406/2017 in June 2017, in which Mr. Vijay Pal Dalmia, Advocate argued in person before the Hon"ble Court and underlined the threat of the virtual currencies on the developing economy like India. While disposing the said petition, the Hon'ble Court gave a specific direction to the Reserve Bank of India to examine the issue posed by the Petitioners and take a conscious decision on the same.
That in terms of the Order dated 14.07.2017 of the Hon'ble Court, the Petitioners raised the present issues before Reserve Bank of India and in order to apprise the Union of India and other ministries, shared the copy of the writ petition with them. That the RBI had sent an evasive reply to Petitioners, wherein RBI shrugged aside its duty to conclusively take a stand either in favour or against the illegal Virtual Currencies like Bitcoins and the Petitioners did not receive any response from the Union of India and other ministries, which compelled the Petitioners to file the present PIL.
A Virtual Currency/ Cryptocurrency like Bitcoin, is a stateless digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank like the Reserve Bank of India, without any trail or track, rendering it immune from government interference. That most of the currencies in the world including the currency of India i.e. rupee, are Fiat currencies.Fiat money is the currency that a government has declared to be legal tender, but which may not be backed by any physical commodity like Gold.
That some of the laws which in view of the Petitioners are being violated because of open trading of illegal Cryptocurrencies like Bitcoins, are as under:
• The Constitution of India, 1950;
• Reserve Bank of India Act, 1934,
• The Foreign Exchange Management Act, 1999 (FEMA);
• The Reserve Bank of India Act, 1934 (RBI Act);
• The Coinage Act, 1906 (Coinage Act),
• The Securities Contracts (Regulation) Act, 1956 (SCRA);
• The Sale of Goods Act, 1930 (Sale of Goods Act);
• The Payment and Settlement Systems Act, 2007 (Payment Act).
• Indian Contract Act, 1872 (Contract Act).
The present petition was heard along with Writ Petition (Civil) No. 1076/2017.
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