The trigger for the act by Income Tax department is understood to be the giant spike being registered ter the value of bitcoins and other virtual currencies te the latest past
Updated: Dec Legal, 2017 20:29 IST
By Press Trust of India , Press Trust of India, Fresh Delhi
Widening its probe into bitcoin investments and trade, the Income Tax (IT) department is set to kwestie notices to Four to Five lakh high networth individuals (HNI) across the country who were trading on the exchanges of this unregulated virtual currency.
The taxman had conducted surveys at nine such exchanges last week to check instances of tax evasion.
The department, official sources said, found that out of the estimated 20 lakh entities registered on thesis exchanges, about Four to Five lakh were &ldquo,operational&rdquo, and indulging ter transactions and investments.
Sources told PTI that the Bengaluru investigation wing of the tax department, which supervised last week&rsquo,s operations, has now dispatched the information of the individuals and entities found on thesis databases to eight other such wings across the country for a detailed probe.
&ldquo,Those individuals and entities whose records were recovered by the department are now being probed under tax evasion charges. Notices are being issued and they will have to pay capital gains tax on the bitcoin investments and trade,&rdquo, a senior official privy to the operation said.
About 4-5 lakh HNIs and their businesses are being issued notices which will very first seek their relevant financial details and subsequently establish the tax request, if any, he said.
Spil the bitcoins or the virtual currencies (VCs) are illegal and unregulated ter the country spil of now, the IT department has taken act spil vanaf the existing provisions, they said.
The survey operations conducted last week, under section 133 A of the Income Tax Act, were undertaken for &ldquo,gathering evidence for establishing the identity of investors and traders, the transaction undertaken by them, identity of counter-parties, related bankgebouw accounts used, among others,&rdquo, they said.
A survey activity under the IT law pertains to the tax officials making a verrassing visit to the business premises of the party under activity but not their residential ones.
The trigger for the act is understood to be the massive spike being registered ter the value of bitcoins and other virtual currencies te the latest past.
Suspected black money being converted into white, postbode demonetisation, through the use of bitcoins wasgoed also under the department&rsquo,s scanner, officials said.
Earlier this month, there wasgoed a glob te the value of a bitcoin. It rose from under USD Ten,000 at the commence of the year to close to USD 20,000, before a acute 20 vanaf cent plunge within hours.
Bitcoin, a virtual currency, is not regulated te the country and its circulation has bot a cause for concern among central bankers the world overheen for fairly a while now.
The Reserve Handelsbank of India (RBI) has also cautioned users, holders and traders of virtual currencies. The government has also said that it does not recognise &lsquo,crypto-currency&rsquo, spil legal tender ter India.
Te March, the Union finance ministry constituted an Inter-Disciplinary Committee to take stock of the present status of virtual currencies both ter India and globally and suggest measures for dealing with them.
The committee has submitted its report which is being examined.