Wow guys great to read all the answers of the members here. just to sum the whole things up the earning from buying/selling of bitcoins needs to be treated differently and the earnings from mined bitcoin needs to be treated separately. People who are providing their services in lieu of bitcoin have different tax exposure from the people who are selling goods for bitcoins because of the definitions as to what is considered as considerations in both indirect taxes i.e. VAT and Service Tax. Vat will be even more complex as it varies from state to state.

Regards
--
Kanishk Agarwal
Advocate
CriTaxCorp
Criminal-Taxation-Corporate
www.critaxcorp.com
+919971666252