The Delhi High Court has dismissed a petition seeking to regulate cryptocurrency exchanges and order a probe into the Indian exchange Bitbns, firmly stating that the creation of crypto laws is the responsibility of the government and Parliament, not the judiciary.
The case was filed by investor Rana Handa, who accused Bitbns of restricting withdrawals and manipulating the displayed value of his Bitcoin holdings. Handa claimed to have invested ₹14.22 lakh (approximately $15,637) starting in 2021 and later faced withdrawal limits and incorrect portfolio valuations in 2025. After receiving no response from a cybercrime complaint, he petitioned the court for regulatory action and a Central Bureau of Investigation (CBI) probe into the exchange's alleged financial mismanagement.
Justice Purushaindra Kumar Kaurav, presiding over a bench, rejected the plea. The court ruled that Bitbns is a private entity and does not qualify as a "State" under Article 12 of the Constitution. Consequently, it falls outside the court's writ jurisdiction under Article 226, which is typically used against government bodies. The bench clarified that courts interpret and enforce laws but cannot create new regulations, a function reserved for the legislature and financial regulators like the Reserve Bank of India (RBI) and the Securities and Exchange Board of India (SEBI).
The judgment underscores the significant regulatory gap in India's crypto sector. Despite being one of the world's largest crypto markets with over 123 million active users, the country lacks a comprehensive regulatory framework. While the government has implemented a 30% tax on crypto gains and a 1% Tax Deducted at Source (TDS), specific laws governing exchanges and investor protection are absent.
The court advised affected investors to seek redress through existing legal channels, such as filing First Information Reports (FIRs) with local police or pursuing civil suits. This decision leaves crypto users in India dependent on general financial, civil, and criminal laws when disputes arise with private platforms, highlighting the risks and legal uncertainties in the current environment.
