New Income Tax Bill Does Not Grant New Powers to Access Social Media, Emails, Digital Assets, Sources Say

The Income Tax Bill 2025 does not grant new powers to tax authorities to access social media, personal emails, or other digital assets, according to people familiar with the matter. The bill only reiterates existing provisions under the Income Tax Act, 1961, which already allow authorised officers to inspect and seize electronic records during search and seizure operations, they said.

The search and seizure operations are conducted based on credible information and must be authorised by the competent authority, the people told NDTV Profit on the condition of anonymity, adding that that the bill is aimed at enforcing tax laws effectively and tackling black money, not expanding the existing powers of tax officers.

The clarification followed media reports suggesting that the bill gives tax officers expanded authority to override access codes and access digital platforms, including email servers, social media accounts, online investment accounts, trading accounts, and banking platforms.

The Clause 247 of the bill mirrors the existing Section 132 of the Income Tax Act, 1961, and does not introduce any new provisions, the people said, adding that such access is permitted only in cases where a search and seizure operation has been ordered by a competent authority and the individual does not cooperate.

During tax investigations, crucial evidence is often found in digital records stored on various platforms, including standalone desktops, remotely accessed computers, mobile devices, cloud storage, and enterprise software, the people said, noting that businesses often use cloud-based accounting tools, enterprise resource planning systems, and software as a service platforms that hold financial records. Additionally, digital communication platforms such as WhatsApp, Telegram, and emails are frequently examined for evidence of tax evasion.

Authorities have faced challenges in gaining access to such records when individuals refuse to provide necessary access credentials or when data is stored on servers located outside India. In such cases, search and seizure operations may become ineffective, making it difficult to establish tax evasion and recover government dues.

Historically, Supreme Court rulings upheld the legality of search and seizure provisions under the Income Tax Act and noted that search operations play a crucial role in preventing tax evasion, recovering undisclosed income, and ensuring economic stability. The apex court had also upheld the validity of search and seizure operations, stating that such measures are necessary to combat unaccounted money and safeguard the economic system.