In such a scenario I can only see following ways out:
1. I should file my income as Capital Gains where I can mark Cost of Acquisition to be NIL and file either STCG or LTCG on whole amount which has been credited to my account in previous year from buyers.
2. Carry on with my existing practice of showing credits as receipts and pay tax under PGBP. However, in this case I won't be able to provide any bill if I received Notice from Income Tax Department.
Are you facing the similar situation? If yes, then what have you decided. If no, then too share your views. Let's have a quality discussion as it is serious matter for Crypto Earners in India.
Filing under capital gains is the option if you are making enough money with bitcoin, but the real problem is with the current government, you really cannot trust how they will deal with the platform since there is no clarity on whether they will legalize it or not, what if they go after everyone who traded bitcoin once you report it as capital gains and then there will be a huge issue to deal with the legal issues. I am not that good in this field and hence i posed this doubt. Will the government has the ability to come after bitcoin investors at a later time if they ban it completely.
I don't think government will come after old transactions even if trading Bitcoin gets ban in future. Any law is applicable from the point of time when it is actually comes into effect. All transactions before that point of time is outside the scope of that law. So there is no problem to report any Crypto profits as CG for filing return of Assessment Year 2019-20.
The actual problem which makes reporting income as Capital Gains difficult is complications in finding Cost of Acquisition. In the absence of COA, one has to pay tax on whole selling value which would result in lots of money flowing out as a tax.