I-T Bill proposes govt can ‘override’ online access codes

1. The Income tax bill 2025  will  give tax officials the power to override or break passwords on digital devices and accounts.
2. This can apply to phones, laptops, emails, social media, cloud storage, and even encrypted apps like WhatsApp.
3. The bill allows officials to either use password-breaking tools or ask tech companies to help bypass login credentials.
4. Even phone manufacturers like Apple could be asked to assist in breaking into a device.
5. A new phrase added to the bill gives legal backing to this power, which was not present in the current Income Tax Act.

Existing Powers and What’s Changing

1. Under Section 132 of the current Act, tax officers can search premises, seize documents, and examine electronic records.
2. If someone refuses to cooperate, officials can break physical locks or seize devices.
3. The new bill keeps these powers but goes further by allowing entry into “virtual digital spaces” by overriding digital access controls.

What changes if the bill becomes act

Aspect	Before (Existing Powers – I-T Act, 1961)	After (Proposed Powers – I-T Bill, 2025)
Search and Seizure	Tax officers could search premises, seize documents, and examine electronic records.	These powers remain unchanged.
Dealing with Non-Cooperation	Officials could break physical locks or seize devices if the person refused to cooperate.	Still allowed.
Access to Digital Spaces	No explicit power to override or bypass digital access controls like passwords.	Now explicitly allows override of passwords and access codes.
Email Servers	Officers could access only if user gave access or password was shared.	Officers can now legally override passwords to access email accounts.
Social Media Accounts	Access was limited unless credentials were voluntarily shared.	Officers can now access even if user refuses, by bypassing passwords.
Online Banking/Trading Accounts	Access depended on voluntary disclosure by the person under scrutiny.	Officials may now override login security to check account activity.
Cloud Servers	Could only be accessed if login information was given by the user.	Access now allowed by breaking access controls or seeking tech company help.
Asset Storage Websites	Officials needed user cooperation to access digital asset details.	Now permitted to override protections to view ownership or transactions.
Other Digital Platforms	Not clearly covered under the existing law.	Broadly covered now under the term “virtual digital space”.

What Officials Say

1. Tax officials argue that there are no major changes in power.
2. They claim the new bill only simplifies the language for better understanding.
3. Officials say they already collect digital evidence like emails and chats from apps like WhatsApp and Telegram.
4. They believe access to these platforms is crucial for proving tax evasion.

Legal and Privacy Concerns

1. Experts say the power to override passwords was earlier in a grey area, and now the bill makes it explicit.
2. Privacy advocates and legal experts are worried this could lead to abuse of power.
3. Without safeguards, such powers could allow invasion of personal privacy or harassment of taxpayers.
4. This is seen as a major change from the Income-tax Act, 1961, which did not include digital domain override.

Digital Privacy Law and Loopholes

1. The Digital Personal Data Protection Act is not yet enforced.
2. Even after it is implemented, tax officials may be exempt, which weakens its impact.
3. This exemption has been criticized for allowing too much power to government agencies without checks.

Demand for Safeguards

1. The Internet Freedom Foundation (IFF) wrote to the Parliament’s Select Committee.
2. IFF said the bill should follow the Supreme Court’s 2017 privacy judgment, which emphasized:
   1. The use of the least invasive methods
   2. Applying the proportionality standard before taking action
3. IFF warned that without clear limits, the new powers may lead to unchecked surveillance and violate citizens’ privacy rights.

The proposed changes in the Income Tax Bill, 2025 mark a significant shift in the government’s approach to digital investigations. By explicitly granting tax authorities the power to override passwords and access private digital platforms, the bill extends search and seizure powers into deeply personal virtual spaces.

 

Also Read
UPSC Foundation Course	UPSC Daily Current Affairs
UPSC Monthly Magazine	CSAT Foundation Course
Free MCQs for UPSC Prelims	UPSC Test Series
ENSURE IAS NOTES	Our Booklist