Sakina Tashrifwala
Published on: 14 September 2022 at 18:20 IST
The Supreme Court again questioned the Centre on the validity of Bitcoin transactions while hearing a hearing request made by Ajay Bharadwaj, one of the accused in the Gain Bitcoin fraud.
Justices MM Sundresh, Surya Kant, and Indira Banerjee observed, “There’s a grey area on the legality of bitcoins. The extension of interim protection can be confirmed. It’s your prerogative. If you declare it as illegal, it’s up to you… “
Additionally, on February 25, while hearing the case, the court requested clarification from the centre regarding the legitimacy of cryptocurrencies.
Senior attorney Sidhartha Dave, who was representing the petitioner during the hearing, stated that the previous court orders had been followed.
The Supreme Court criticised Bhardwaj in April for disobeying its order to give the Enforcement Directorate (ED) access to the user name and password of crypto currency wallets.
The bench had instructed Bhardwaj to fully disclose the username and password for the cryptocurrency wallet to the Enforcement Directorate on March 28, 2022, in order to obtain temporary protection. The Top Court had ordered that Bhardwaj’s interim protection be maintained, subject to his complete disclosure of the login and passwords for his cryptocurrency wallets.
ASG Aishwarya Bhati, however, refuted this and claimed that the probe had gone on and that the petitioner had not cooperated in several crucial areas.
Additionally, Dave informed the court that the Pune Police, who had requested his custody, are now being investigated for embezzling bitcoins.
ASG Bhati believed that the bitcoin transactions were a part of a broader ponzi scheme, whereas Dave questioned how a criminal complaint could be maintained in a contractual transaction.
Dave contested that, “Ponzi schemes should have some value. The government says that for bitcoins, there’s no value…. “
“Instead of scattered investigations, let one agency investigate.” While requesting ASG Bhati’s agency preference, the bench gave advice. The ASG promised to return with instructions.
“An agency which understands the transactions,” Dave requested.
Light-heartedly, the bench noted, “An agency that does not understand the transactions will be better for you.”
The Bench postponed the issue when ASG Bhati advised transferring all cases to the CBI for resolution. It was emphasized to consider the option suggested thereafter the statement will be taken on record.
As the session came to a close, the Court also renewed the petitioner’s temporary immunity from arrest, with condition that he will be cooperating with the ongoing investigation.