Lok Sabha Question No. 1366 (UNSTARRED), answered on 2025-12-08
Subject: Black Money in Crypto Currency
Ministry: FINANCE
Asked by: Shri Anand Bhadauria

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF ECONOMIC AFFAIRS

## LOK SABHA UNSTARRED QUESTION NO. 1366

TO BE ANSWERED ON 08.12.2025/ 17 Agrahayana, 1947 (Saka)

## Black Money in Crypto Currency

1366. Shri Anand Bhadauria : Will the Minister of Finance be pleased to state:

- (a)  whether  Government  has  issued  Regulations  governing  crypto  currency  in  the country; (b)  if  so,  the  details  thereof  and if  not,  the  reasons  for  allowing  USD  15  billion  Indian crypto industry to operate without regulation; (c)  whether  the  Government  is  aware  that  large  scale  flow  of  black  money  is  routed through crypto currency, if so, the details thereof; and (d)  the  details  of  action  taken  by  the  Government  to  monitor  black  money  in  crypto
- exchanges and to regulate the crypto currencies in the country?

## ANSWER MINISTER OF STATE IN THE MINISTRY OF FINANCE

## (SHRI PANKAJ CHAUDHARY)

(a) to (b): Crypto-assets/Virtual Digital Assets (VDAs) are unregulated in India, and the  government  does  not  collect  data  on  them.  As  these  assets  are  inherently borderless, they require strong international coordination to prevent regulatory arbitrage. Therefore,  any  regulatory  framework  for  crypto  assets  can  be  effective  only  with significant international collaboration on the evaluation of the risks and benefits and the evaluation of common taxonomy and standards.

(c) to (d): Cases  of  tax  evasion  linked  to  crypto  currency  and  VDAs  have  been detected by the Central Board of Direct Taxes (CBDT) on multiple occasions, and the

Income Tax Department takes action as per the Income Tax Act, 1961. Wherever tax evasion  is  detected,  necessary  action,  such  as  nudging  taxpayers,  e-verification, reassessment,  survey,  or  search  and  seizure,  is  taken.  During  search  and  seizure operations,  undisclosed  income  from  VDA  transactions  of  Rs  888.82  crore  has  been identified. Under  the  CBDT's  NUDGE (Non-Intrusive  Usage  of  Data  to  Guide  and Enable) campaign, 44,057 communications have been sent to taxpayers who invested or traded in VDAs but did not report these in Schedule VDA of their Income Tax Returns (ITRs). Data analytics tools, Project Insight and internal databases are used to match information on VDA transactions with disclosures in ITRs. TDS returns filed by Virtual Asset  Service  Providers  (VASPs) and  taxpayers'  ITRs  are  also  analysed  to  identify discrepancies and take appropriate action.

The  Government  has  brought  VDAs  under  the  Prevention  of  Money  Laundering (PMLA), 2002, making VASPs Reporting Entities and required to submit specified and suspicious transaction reports to FIU-IND. These reports are analysed and shared with law enforcement agencies for further action. The  Enforcement Directorate has investigated several crypto-related cases under PMLA,  attaching/seizing/freezing proceeds  of  crime  worth  Rs.  4189.89  crore,  arresting  29  persons,  and  filing  22 prosecution complaints. One accused has been declared a Fugitive Economic Offender. The  Prohibition  of  Benami  Property  Transactions  Act,  1988,  and  the  Black  Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, apply to all assets, including VDAs. The Benami Act enables prosecution where assets, including VDAs, are held benami, and the Black Money Act enables action against undisclosed foreign assets, including VDAs.

The Government is also undertaking capacity-building initiatives to strengthen monitoring and investigation of VDA-related transactions. Training programmes, workshops, Chintan Shivirs and sessions on digital forensics, blockchain analysis, legal frameworks  and  digital evidence are regularly conducted. Officers also receive specialised short-term training in digital forensics through NFSU, Goa, to help identify and trace VDA-linked transactions from captured data.