The Income Tax department has begun country-wide investigations into the bitcoin trade, with officers starting off on 'surveys' at prominent bitcoin exchanges in the area.
Officers told News18 that the surveys are being taken up under Section 133A of the Income Tax Act, which gives them powers to enter the office or business premises of any organisation and verify documents, books of accounts, valuables and data for his enquiries (and hence this is different from raids -- where even the homes of those under scanner and their aides can be raided).
Surveys are typically done during office hours (but once begun, can continue for any number of hours), and inventories of cash, stocks can be made, statements taken — but seizure of any documents or properties are not allowed.
Nine bitcoin exchanges are being covered under the surveys taken up on Wednesday — spread across Bengaluru, Delhi, Hyderabad, Ghaziabad, Gurgaon and Pune. The biggest exchange is zebpay — whose turnover dramatically rose from Rs 1,200 crores last year to Rs 10,000 crores this year.
While bitcoin trade is not illegal per se, it is what is believe to be a 'grey area' -- neither legal nor illegal. What has drawn the attention of the authorities seem to be the amazing rise in valuation.
"Surveys are being done to gather evidence for establishing identity of investors and traders, transactions undertaken by them, identity of counter parties and related bank accounts used, etc," said an officer.
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