Ruling on research and seizure of digital data even in the old law, explicitly mentioned only in the new income tax law: CBDT member

“This is the provision of research and seizure, including the digital field, already found in the income tax law, 1961.”

“Providing research and confiscation is also present in the old verb. We can search the digital space under it because the definition of account books includes account books preserved in the digital form.

He pointed out that the research and confiscation to detect unknown income, and pointed out that if these records are preserved online or on the cloud, or if the money is invested in the virtual digital assets, then the tax authorities are obligated to reach them.

PARBAT also indicated that searches and prestiges are few per year and that the ruling to overcome the passwords of the residents is called only in these cases. “It is necessary to discover unknown income and get taxes due to the nation,” he stressed.

The income tax law, 2025, contains specific provisions on the virtual digital spaces according to which the digital research and the prestiges according to which the tax authorities can access electronic documents and can exceed passwords from the restrictions during searches and confiscation. The move has sparked concerns about digital privacy and comprehensive authorities of the tax authorities.

However, Parbat emphasized that there is no transgression, and that they are all basic parts of searches and surveying. He said: “We must have passwords to discover the unknown income and the undeclared assets,” noting that even early when the physical assets were kept in the tanks or some vessels, the Ministry of Income Tax had the ability to open the cabinet if the key was not provided by the evaluation.

Meanwhile, commenting on more changes in the income tax in the Federation’s budget 2026-27 after the approval of the new income tax law, Parbat said it is from the ministry’s privilege and will be determined closer to history.

The income tax law, 2025, is scheduled to enter into force as of April 1, 2026. He received the approval of the President on August 21, 2025, after Parliament approved it in the monsoon session.