At the beginning of April, India’s central bank, Reserve Bank of India directed the regulatory bodies to sever any ties with the cryptocurrency businesses. Now, a petition has been signed against the bank’s orders for crypto ban citing the move violative of the constitution while asking for appropriate crypto regulations.
RBI gets dragged to court for cryptocurrency crackdown
After barring the regulated bodies from providing services to any individual and business that deals with cryptocurrencies in early April, India’s central bank, Reserve Bank of India(RBI) has been now been taken to court by the company, Kali Digital EcoSystems.
RBI took a directive where the banks were asked to wind up their businesses with cryptocurrency exchanges by July this year. This move put an end to the several businesses in India’s crypto market.
Now, a petition has been filed in the Delhi High Court by Kali Digital that challenges Indian Banking regulator’s ban on crypto organizations. The company has claimed the RBI’s move an
“arbitrary, unconstitutional and violative of the Constitution.”
The petition also includes GST (goods and services tax) that calls for an appropriate cryptocurrency regulatory framework.
In response, the Delhi high court has issued a notice to the RBI, Ministry of Finance, The Union of India through Secretary and GST Council.
The petition on crypto ban claims a violation of rights under the constitution
The Ahmedabad-based, Kali Digital EcoSystems, that has filed the petition had been planning to launch its crypto exchange CoinRecoil in coming August. The company has challenged RBI on two grounds.The first one is under the Indian Constitution’s Article 19 (1) (g) that allows Indian citizens to carry out any occupation, trade or business. The second ground is Article 14 that prohibits any discrimination while mandating equal protection for all under the law.
Rashmi Deshpande, the associate partner of the law firm Khaitan & Co. that is representing Kali digital in the lawsuit explains:
“The circular appears to be arbitrary and unconstitutional since it does not give strong facts as to why RBI is against the business of cryptocurrencies. Logical and well-thought argument backed by solid facts are the primary requirements under the constitution to put a stop to any business in India.”
As for including the government of India and GST in the petition, it has been claimed that they haven’t formulated appropriate regulations for cryptocurrencies that have led to the rise of this situation.
May 24 has been scheduled for the next hearing of the case.
Online petition against RBI’s stance on crypto underway
This is not the first not it will be the last time that a petition regarding crypto has been filed in India as many cryptocurrency firms are already considering filing a petition and challenging RBI’s order in court. In the past, the petitioner Dwaipayan Bhowmick sought explanations for the delay in the crypto regulatory framework regarding which Supreme Court of India issued a notice to the Ministries of Law and Justice, SEBI, IT, Finance, and RBI.
Cryptocurrency enthusiasts have also taken the route of the online petition called “Make India at the forefront of Blockchain Applications revolution” which is filed under the name of ‘Digital Asset Exchanges of India’ against RBI’s crypto ban that has been signed by thousands of people.
Meanwhile, the government has set up a committee to draft a law for cryptocurrencies that is likely to be submitted by March, next year.
Do you think Indian crypto enthusiasts and investors have a chance here?