Unocoin said the Karnataka high court has dismissed the long-pending FIR against the firm. Unocoin had set up a kiosk in 2018 to allow customers to deposit money to or withdraw money from their Unocoin accounts. On the grounds that they had not been granted the necessary approvals for setting up the kiosk, the local police had detained Unocoin’s co-founders.
Following a Supreme Court decision, the Karnataka HC quashed the FIR registered against them by the cybercrime police. Last year, the SC in the Internet and Mobile Association of India case set aside the RBI’s April 2018 circular banning financial services companies from trading in virtual or cryptocurrency. Citing the same, Harish and Vishwanath had challenged the FIR.
Considering the current legal position, Justice H P Sandesh allowed their petition, noting that in view of the SC’s decision, the FIR as well as proceedings against the petitioners on the basis of the RBI circular cannot be continued further.
Unocoin said branding the kiosk as an ATM was a genuine mistake that led to confusion. The high court has declared the FIR invalid. Vishwanath, Unocoin’s CEO, said they were elated to emerge victorious. “This legal mishap was no less than a war and having cleared our stance feels like attaining victory,” he said.
In 2018, the Bitcoin ATM was set up at Kemp Fort mall in Bengaluru. Thereafter, the police had registered a case, citing violation of the RBI circular.
The cyber crime branch (CCB) had taken up the case and had filed a chargesheet against the duo in May 2019. Later, the additional chief metropolitan magistrate court (ACMM) took cognizance of the matter and thereafter their bank accounts were also frozen. The petitioners, who challenged the same, also sought de-freezing of their bank accounts.
Last year, Unocoin raised $5 million in a round led by Tim Draper’s Draper Associates, with participation from XBTO Ventures and 2020 Ventures.