Income tax officers may access your email and social media accounts from financial year 2026-27 under certain circumstances

Experts caution that this could pose threats to essential privacy rights in the absence of judicial oversight and procedural protections.

Beginning April 1, 2026, the income tax department will be empowered to monitor social media, emails, and various digital platforms to combat tax evasion. This authority is established by the new income tax legislation. Additionally, the department will possess search and seizure capabilities regarding assets and documents, prompting significant privacy concerns. Experts caution that this could pose threats to essential privacy rights in the absence of judicial oversight and procedural protections.

If there are suspicions that you have avoided paying income tax or if there is any indication that you possess undisclosed income, cash, gold, jewelry, or other valuable assets or properties for which you have not fulfilled your tax obligations according to the Income Tax Act of 1961, they may take action under the new income tax legislation.

Section 132 of the Income Tax Act of 1961 empowers authorized officers to perform searches and confiscate assets and financial records if they possess credible information suggesting that an individual is concealing income, property, or documents to avoid paying taxes.

Under the current legal framework, these officers are permitted to forcibly open any door, box, or locker if they lack the keys and have reasonable grounds to believe that undisclosed assets or financial records are stored within.

 The new income tax bill has expanded this authority to include access to your computer system or virtual digital space. The Income Tax Bill of 2025 (“ITB”) grants tax authorities the authority to access any computer system or digital space by bypassing access codes during their search operations as outlined in the ITB.

Under clause 247 of the Income Tax bill, an authorized officer may act if they have grounds to suspect that an individual holds undisclosed income or property that falls within the scope of the Income Tax Act.

“Break open the lock of any door, box, locker, safe, almirah, or other receptacle for exercising the powers conferred by clause (i), to enter and search any building, place, etc., where the keys thereof or the access to such building, place, etc., is not available, or gain access by overriding the access code to any said computer system, or virtual digital space, where the access code thereof is not available.” says the act.

What does this mean for you? Let’s break it down.

What provisions in the new income tax bill support this change?

The Income Tax Bill provides a broad definition of virtual digital space, which includes social media accounts, bank accounts, trading and investment accounts, and emails as part of this category.

According to the new income tax bill, virtual digital space is described as an “environment, area, or realm created and experienced through computer technology, distinct from the physical world. It encompasses any digital domain that enables users to interact, communicate, and engage in activities via computer systems, networks, resources, communication devices, cyberspace, the internet, the worldwide web, and emerging technologies, utilizing data and information in electronic form for creation, storage, or exchange. This includes:

(i) email servers

(ii) social media accounts

(iii) online investment, trading, and banking accounts

(iv) any website that stores ownership details of assets

(v) remote or cloud servers

(vi) digital application platforms

(vii) any other similar space.

Authorized officers are defined in the bill as follows:

(i) Joint Director or Additional Director

(ii) Joint Commissioner or Additional Commissioner

(iii) Assistant Director or Deputy Director

(iv) Assistant Commissioner or Deputy Commissioner

(v) Income-tax Officer or Tax Recovery Officer.

“The expansion of the Virtual Digital Space i.e. VDS, under the new Income Tax Bill raises significant concerns regarding constitutional validity, potential state overreach, and practical enforcement. While the government may justify it as a measure to curb tax evasion and undisclosed digital assets, the broad and vague definition of VDS essentially allows unrestricted surveillance over an individual’s financial and private digital presence. In the absence of judicial oversight or specific procedural safeguards, this provision risks becoming a tool for arbitrary scrutiny rather than a structured tax enforcement mechanism. The new Income Tax Bill lacks clear procedural checks, potentially leading to unrestricted data harvesting and fishing expeditions against businesses, professionals, and individuals,” says Sonam Chandwani, Managing Partner at KS Legal and Associates.

The new Income Tax Bill undermines data privacy principles by granting tax authorities unfettered access to personal and financial digital information without requiring explicit consent or judicial review. This broad surveillance capability, lacking necessary protections, creates a tension between financial oversight and individual privacy rights, which could result in legal disputes and erode trust in India’s digital landscape.

Is it constitutionally valid?

 In the pivotal case of Justice K.S. Puttaswamy v. Union of India (2017), the Supreme Court underscored that the Right to Privacy, protected under Article 21, is absolute. It stated that any governmental intrusion must satisfy the standards of legality, necessity, and proportionality.

Sandeep Bhalla, Partner, Dhruva Advisors, says “This bill empowers forceful access of digital gateways safeguarding financial data by tax officers, raising serious regulatory and ethical concerns. Granting tax authorities the power to override digital access codes without robust checks and balances may lead to constitutional challenges on the grounds of privacy infringement and excessive state surveillance,” he adds. 

It offers a comprehensive definition of virtual digital space, encompassing email servers, social media profiles, banking and trading accounts, cloud storage, and more. This wide-ranging definition may also cover sensitive corporate information related to a taxpayer’s current or former employment.