India&rsquo;s Income Tax Department has uncovered approximately ₹630 crore in undisclosed income from Virtual Digital Asset (VDA) transactions, mainly cryptocurrency trades over the last two financial years, according to official data.
This revelation comes after a focused crackdown by the Central Board of Direct Taxes (CBDT) on tax evasion linked to the rapidly expanding digital asset ecosystem. Since the introduction of a 30% tax under Section 115BBH of the Income Tax Act from FY 2022-23, the government has been closely monitoring crypto activities.
Tax Disclosures and Search Operations&nbsp;
&nbsp;In total, taxpayers reported ₹705 crore in VDA-related income for FY 2022&ndash;23 and FY 2023&ndash;24. However, during search and seizure actions and targeted survey operations, tax officials discovered a parallel ₹630 crore in undeclared income tied specifically to crypto transactions, suggesting significant under-reporting.
The CBDT confirmed that it has taken appropriate action under the Income Tax Act in multiple cases where tax evasion through crypto holdings or trades was uncovered.
NUDGE Campaign and Digital Surveillance&nbsp;
To encourage voluntary disclosure, the CBDT launched the NUDGE campaign (Non-Intrusive Usage of Data to Guide and Enable), sending over 44,000 emails and messages to individuals who traded in VDAs but failed to report their holdings in their Income Tax Returns (ITRs), specifically in the newly added Schedule VDA.
Data Analytics and AI Tools in Action The tax department is also leveraging digital tools like the&nbsp;Non-Filer Monitoring System (NMS), Project Insight, and other internal data intelligence systems to cross-verify transactions against ITRs filed.
TDS returns filed by Virtual Asset Service Providers (VASPs) are being matched with individual filings to identify discrepancies. Where mismatches are found, scrutiny and legal action follow.
Stronger Compliance Framework Underway 
With India tightening its crypto taxation regime, authorities are doubling down on ensuring proper tax reporting and closing loopholes in digital asset transactions. Experts believe this growing enforcement will encourage greater transparency and compliance in the VDA ecosystem.

₹630 Cr Unreported Crypto Income Found by CBDT

Govt detects ₹630 crore in undeclared VDA income over two fiscals, cracks down on crypto t

₹630 Cr Unreported Crypto Income Found by CBDT

Govt detects ₹630 crore in undeclared VDA income over two fiscals, cracks down on crypto t

August 5, 2025 | 21:54 IST