In a landmark judgment, a High Court in India ruled that mere transacting in cryptocurrencies does not amount to illegal activities and refused to identify crypto as “money” under the existing financial laws.
On June 12, the Orissa High Court in Odisha, India, ruled that encouraging people to invest in cryptocurrencies does not amount to any illegal activity. The court gave its observation while granting bail to two persons who have been arrested by police in a so-called Ponzi/Pyramid marketing scam, where the accused allegedly asked investors to put money in Yes World Token by creating a trust wallet.
The verdict by the Orissa High Court has the potential to redefine the crypto landscape in India, which has been marred by skepticism from the central bank and government. India has refused to identify crypto assets as legal tender and imposed a heavy 30% tax on any crypto-related earnings against the Indian rupee. The crypto community in India is hopeful that the third term of incumbent Prime Minister Narendra Modi and second-term of incumbent finance minister Nirmala Sitharaman could see relaxations in local crypto regulations.
The verdict by Orissa High Court came through a single bench led by Justice Sasikanta Mishra who granted bail to the two individuals who were booked under various sections of the Indian penal code and the Odisha Protection of Interests of Depositors Act (OPID Act). The police had claimed that the accused lured investors by promising high returns on any investment against Yes World Token.
“The accused can only be said to have attempted to convince members of the public to trade in crypto currency – Yes World Token. There is nothing on record to show that they had dishonestly induced any person to deliver any property to them. In other words, there is no evidence whatsoever of any money being transferred from any person to the accused,” observed Justice Mishra in his judgment, as reported by The New Indian Express.
This distinction was pivotal in dismissing charges under Section 420 of the Indian Penal Code (IPC), which pertains to cheating and dishonest motives.
Moreover, the court clarified that traditional financial crime charges such as forgery (Sections 467/468/471 of IPC) were also unsubstantiated, as no falsification of documents or manipulation was evidenced.
India, has time and again, called for a global regulatory framework on emerging Web3 technologies like blockchain and decentralized applications on which cryptocurrencies are dealt. It is expected that the recent ruling by Orissa High Court will be used as a precedent judgment by pro-crypto advocates in future legal cases related to cryptocurrencies in India. The desi crypto community indeed sees it as a silver lining.
