By buld_online 
India’s top tax authority is turning up the heat on crypto evaders. The Central Board of Direct Taxes (CBDT) has launched a sweeping crackdown on individuals and entities suspected of laundering unaccounted income and evading taxes through undisclosed or underreported cryptocurrency transactions.
According to sources, the CBDT’s data-driven investigation has flagged thousands of high-risk taxpayers who failed to disclose Virtual Digital Asset (VDA) income for the assessment years 2023–24 and 2024–25.
In many cases, individuals either skipped the mandatory Schedule VDA in their income tax returns or wrongly claimed deductions and preferential tax rates, violating key provisions under the Income Tax Act, 1961.
The scrutiny centers around Section 115BBH—introduced in the Finance Act, 2022—which imposes a flat 30% tax on VDA income. Crucially, this section allows no deductions beyond the cost of acquisition and prohibits offsetting VDA losses against other income or carrying them forward.
CBDT officials are matching ITRs filed by taxpayers with Tax Deducted at Source (TDS) data submitted by crypto exchanges—formally known as Virtual Asset Service Providers (VASPs).
This real-time reconciliation has uncovered a wave of mismatches, prompting the tax department to send compliance emails to thousands of users urging them to revise and update their returns.
This enforcement drive is part of the CBDT’s NUDGE framework (Non-Intrusive Usage of Data to Guide and Enable), which promotes voluntary compliance through data insights. It marks the third such campaign in six months, following earlier initiatives targeting undeclared foreign assets and bogus deductions under Section 80GGC.