The Delhi High Court has dismissed an appeal filed by users of cryptocurrency exchange BitBNS seeking a court-monitored investigation into alleged financial irregularities and regulatory failures. The Division Bench held that the dispute arose from private commercial transactions and could not be converted into a public law issue merely because many investors were affected.
Background of the Case
The appeal was filed by Amit Ranjan and other investors challenging a Single Judge's order dated February 11, 2026, in which the High Court had declined to entertain their writ petition.
The appellants claimed they were users of the BitBNS cryptocurrency platform and alleged that a cyber incident, withdrawal restrictions, and fund management issues had caused financial losses. They sought directions for the Union Government, the Reserve Bank of India, and other authorities to establish a regulatory framework for cryptocurrency exchanges. They also requested a CBI or Special Investigation Team (SIT) probe, release of their funds, and compensation for affected users.
Appellants' Arguments
Senior counsel appearing for the appellants argued that the Single Judge wrongly treated the matter as a private dispute. According to them, the case involved broader questions of regulatory inaction, statutory oversight, and investor protection affecting a large number of cryptocurrency users across the country.
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The appellants also contended that since Virtual Digital Assets (VDAs) are recognised under the Finance Act, 2022 and subjected to taxation and related compliance obligations, cryptocurrency exchanges function within a regulated financial ecosystem deserving judicial scrutiny. They further argued that the scale of the alleged irregularities justified an investigation by a specialised central agency.
Court's Observations
The Bench of the Chief Justice and Justice Tejas Karia disagreed with these submissions. It observed that the dispute essentially concerned individual customers and a private cryptocurrency exchange over withdrawal restrictions and alleged fund mismanagement.
Rejecting the plea that the matter involved enforceable public law rights, the court observed:
“The controversy is, therefore, in nature of a private commercial dispute. The mere fact that a large number of investors may have been affected does not, by itself, transform the dispute into one involving enforceable public law rights.”
The court further held that BitBNS and its founders are private entities and cannot be treated as "State" under Article 12 of the Constitution merely because virtual digital assets are taxed under the Finance Act.
The Bench also relied on its earlier decision in Rana Handa v. BitBNS Internet Pvt. Ltd., noting that in the absence of a dedicated statutory framework governing cryptocurrency exchanges, writ jurisdiction cannot be invoked simply because numerous investors claim to have suffered losses.
Why the Court Declined Relief
The High Court said the investors' request for release of funds would require detailed examination of individual account balances, the reasons behind withdrawal restrictions, and evidence relating to the alleged cyber incident. Similarly, claims for compensation would require proof of loss, determination of liability, and assessment of damages.
According to the Bench, these disputed factual issues cannot be decided in proceedings under Article 226 of the Constitution and must instead be examined by competent civil or consumer forums after appropriate evidence is led.
The court also noted that a collective criminal complaint had already been filed on the National Cyber Crime Portal and that the appellants remained free to pursue civil and consumer law remedies.
Decision
Finding no legal error in the Single Judge's decision, the Division Bench dismissed the Letters Patent Appeal. The court held that the appellants had failed to establish any exceptional circumstance warranting a CBI or SIT investigation or justify issuance of directions regulating cryptocurrency exchanges in writ proceedings. The pending application was also disposed of, with no order as to costs.
Case Details:
Case Title: Amit Ranjan & Ors. v. Union of India and Others
Case Number: LPA 393/2026
Judge: Hon'ble the Chief Justice Devendra Kumar Upadhyaya and Hon'ble Mr. Justice Tejas Karia
Decision Date: July 2, 2026
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