SC Orders High Courts Across India To Not Entertain Pleas On RBI Circular On Cryptocurrencies

24 May 2018 8:47 AM GMT
SC Orders High Courts Across India To Not Entertain Pleas On RBI Circular On Cryptocurrencies
Image Credit: Fintech Crypto News

The Supreme Court has barred all the High Courts across the country from entertaining any petition related to the Reserve Bank Of India’s (RBI) Circular issued on April 6 that prohibited dealings in cryptocurrencies such as the Bitcoin, as reported by the Business Standard.

The court passed its verdict while hearing to the pleas to direct the Centre to take necessary steps to restrain the sale and purchase of illegal cryptocurrencies that are used to trade and also, to ban all the websites, web links and mobile applications that are used for trading. It also demanded the Government to give advertisements and extensive publicity through media, informing and educating the public about the illegal dealings of virtual currencies.

The three-judge Bench consisting Justices, AM Khanwilkar, DY Chandrachud and headed by Chief Justice Dipak Misra, also sought the assistance of Attorney General K K Venugopal in this matter and passed the judgement, where RBI had directed all the banks and financial institutions to freeze the bank accounts of those individuals and companies dealing in this illegal trade.

The bench also granted liberty to one of the petitioners to submit a representation to the competent authority in RBI within two weeks so that it can deal with it as per law. The court also heard two other cases of seeking transfer of pleas pending before the High Courts of Delhi and Calcutta.

The top court has adjourned the matter for further hearing on July 20.

Cryptocurrencies are digital or virtual currency in which the encryption techniques are used. They use decentralised control which does not come under the ambit of central banking systems or RBI. Cryptocurrency works on the blockchain technology which is a public transaction database and functions as a distributed ledger.

The first decentralised cryptocurrency, Bitcoin, was created in 2009, since then

1800 cryptocurrencies have been made. Two months ago, RBI had banned the sale or purchase of cryptocurrencies in India.

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