With no clear cryptocurrency policy announced on February 1st in India's Annual Budget, there was some official support for the underlying blockchain technology. Arun Jaitley, a top lawyer currently serving as Minister of Finance and of Corporate Affairs, made it clear that there is no governmental opposition to blockchain per se, and indeed, they would be taking a proactive approach to blockchain as means to usher in the new digital economy. 

These comments were welcomed by India's BACC (Blockchain & Cryptocurrency Committee), who see in them a veiled promise of regulatory moves to come in the cryptocurrency market. The BACC is a group of digital currency exchanges that are operating in the country, and lobbying for government regulation.

As far as taxation is concerned, there is no framework for dealing with the income from cryptocurrencies. A law firm spokesman suggested that cases would have to be treated individually. Tax lawyers and accountants would have to consider the circumstances and facts of all the transactions for each client, in order to decide whether to treat digital currency as "capital gains" under tax law or as "profits and gains of business."

Tax compliance is heavily scrutinised in the country, with the Tax Office already looking into cryptocurrency, so substantial profits would have to reported, whether or not they qualify as legal tender.