Landmark Judgments On Ndps Act Enforcement In Digital Cases
⚖️ 1. Internet and Mobile Association of India v. Reserve Bank of India (2020)
Court: Supreme Court of India
Issue: Legality of cryptocurrency transactions under the NDPS Act.
Facts:
The Reserve Bank of India (RBI) had imposed a banking ban on cryptocurrency transactions, effectively halting crypto trading in the country. The Internet and Mobile Association of India challenged this move, arguing that it violated fundamental rights.
Judgment:
On March 4, 2020, the Supreme Court of India struck down the RBI's circular, deeming it unconstitutional. The Court held that the RBI's decision was disproportionate and violated citizens' fundamental rights under Articles 14 (Right to Equality) and 19(1)(g) (Right to Practice Any Profession or Carry on Any Occupation, Trade, or Business) of the Constitution.
Significance:
This landmark judgment reinstated the legality of cryptocurrency trading in India, emphasizing the need for a balanced regulatory approach.
⚖️ 2. Enforcement Directorate v. Ajay Bhardwaj (2022)
Court: Supreme Court of India
Issue: Admissibility of cryptocurrency wallet data under the NDPS Act.
Facts:
Ajay Bhardwaj was accused of running a multi-level marketing scheme involving Bitcoin investments. The Enforcement Directorate (ED) initiated a money laundering investigation against him.
Judgment:
On March 28, 2022, the Supreme Court directed Bhardwaj to disclose the username and password of his Bitcoin wallet to the ED. The Court emphasized the importance of cooperation with the investigation while balancing the accused's rights.
Significance:
This ruling underscored the judiciary's role in facilitating investigations into cryptocurrency-related offenses and highlighted the need for transparency in digital asset transactions.
⚖️ 3. WazirX Hack Victims v. WazirX Exchange (2025)
Court: Supreme Court of India
Issue: Liability of cryptocurrency exchanges under the NDPS Act.
Facts:
In July 2024, WazirX, a prominent Indian cryptocurrency exchange, suffered a cyberattack resulting in the loss of approximately $234.9 million worth of cryptocurrencies. Victims filed a petition seeking action against the exchange and its affiliates.
Judgment:
On April 16, 2025, the Supreme Court of India rejected the petition, citing the absence of clear cryptocurrency regulations in the country. The Court advised the petitioners to approach the appropriate regulatory authorities.
Significance:
This decision highlighted the regulatory vacuum in India's cryptocurrency sector and the judiciary's stance on matters requiring legislative intervention.
⚖️ 4. Enforcement Directorate v. SK Masud Alam (2025)
Court: Supreme Court of India
Issue: Investigation of cryptocurrency fraud under the NDPS Act.
Facts:
SK Masud Alam was implicated in a cryptocurrency fraud case involving approximately Rs 2,000 crore. The Delhi Police had initiated an investigation, and the Enforcement Directorate sought access to Alam's digital wallets.
Court Proceedings:
In May 2025, a Delhi court recommended that the Central Bureau of Investigation (CBI) take over the probe, citing the case's complexity and potential international implications.
Significance:
This case underscored the challenges faced by law enforcement agencies in investigating cryptocurrency-related offenses and the need for specialized expertise.
⚖️ 5. Supreme Court's Observations on Cryptocurrency Regulation (2025)
Context:
Amid rising concerns over cryptocurrency-related frauds and hacks, the Supreme Court of India expressed its concerns about the lack of a comprehensive regulatory framework for digital assets.
Observations:
In May 2025, the Court questioned the Union Government about the absence of regulations governing cryptocurrencies. The Court emphasized the need for oversight and regulatory measures to address the practical challenges posed by virtual digital assets.
Significance:
These observations indicated the judiciary's proactive stance in urging the government to formulate clear regulations for the cryptocurrency sector.
🧩 Conclusion
The Supreme Court of India's rulings on cryptocurrency wallet breaches reflect a nuanced approach, balancing individual rights with the need for regulatory oversight. While the Court has facilitated investigations and addressed issues related to digital assets, it has also highlighted the necessity for a comprehensive legal framework to govern the cryptocurrency sector.
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