Crypto not Goods nor Services: WazirX case dismissed by Forum

More than five months after a Delhi High Court bench advised users of the WazirX exchange to approach a civil forum for redressal of their grievances against the management, the National Consumer Disputes Redressal Commission (NCDRC) dismissed their petition, stating cryptocurrencies do not fall under the categories of either goods or services.

According to a judgment passed by Justice AP Sahi, president of NCDRC and Bharatkumar Pandya, member of the forum, the complaint put forth by Gurmeet Singh, Manveen Kaur and others against Zanmai Labs has been dismissed. The judgment order by NCDRC was given on March 13 and uploaded on Thursday. Advocate Aman Khan represented the complainants in the NCDRC case against Zanmai Labs, the Indian entity of WazirX management.

After the WazirX cryptocurrency exchange was hacked, a group of petitioners had approached Delhi High Court, claiming a discrepancy regarding user funds on behalf of WazirX management post the Rs 2000 crore hack in July 2024. The single-judge Delhi HC bench had issued notices to Delhi Police and FIU and had asked users to approach consumer court for redressal since it was not a criminal complaint against the exchange management.

Now the NCDRC has admitted that virtual digital assets (VDAs) are taxable under the Income Tax Act and GST, yet there’s still no proper law in place to regulate them. They could be considered digital goods, but since they aren’t recognized as legal currency or securities, there’s no clear legal standing.

Presiding over the case, Justice A.P. Sahi and member Bharat Kumar Pandya acknowledged that crypto-related disputes need a dedicated financial regulator, but since India still doesn’t have proper crypto laws, the courts are simply sidestepping the issue.

They also raised concerns about financial fraud and money laundering, suggesting that agencies like the Financial Intelligence Unit of India and the Indian Cyber Crime Coordination Centre should be involved.

The Crypto Times Editorial View on WazirX quagmire

What we’re seeing here isn’t just a lack of regulation—it’s a total lack of accountability. First, the Delhi court redirected the matter to the consumer court. Now, the consumer court has backed off, saying it’s a job for a higher authority.

At this pace, crypto users in India might as well shout their grievances into thin air. Until the government stops sidestepping and sets clear rules, these cases will just bounce around, and justice will stay out of reach. Lose money on a crypto platform? Don’t count on the system—you’d have better odds with a coin toss.