Budget 2026: ICAI suggests I‑T Act 2025 change to restrict taxmen to official emails during searches

Under Section 247 of the Income Tax Act, 2025, authorised tax officials are allowed to inspect any information, including emails and social media, during search and seizure operations.

In its pre-budget memorandum, the Institute of Chartered Accountants of India (ICAI) has suggested amending Section 247 of the Act to restrict taxmen's access only to emails during search and seizure.

According to ICAI, the existing provision could infringe the fundamental right to privacy of persons.

"This provision allows authorised officers to inspect any information, electronic records and communication available on computer systems. This includes emails, social media etc. This provision could infringe the fundamental right to privacy of persons," ICAI said in the memorandum.

"Grant of such unrestricted power to tax authorities to subject personal digital information to surveillance is a cause of concern," it added.

ICAI's suggestion

The top audit body said, "It is suggested that section 247(1) be amended to provide access only to official e-mail accounts of the person. This would protect the fundamental right to privacy of a person."

When are search and seizure conducted?

The tax department does not conduct search and seizure operations in normal circumstances. It is generally done when the taxmen have reasons to believe that any person has an undisclosed income or property. Such operations may also be conducted in a case where the taxpayer doesn't respond to notices or produce relevant documents, or any information in electronic form, that may be relevant for tax proceedings against him/her.

What can tax officials inspect, as per current rules?

The ICAI's pre-budget memorandum says that tax official of the rank of Assistant Director or Assistant Commissioner or Income-tax Officer may be authorised to do the following under Section 247 of the Income Tax Act, 2025:

• Enter and search any building, place, vessel, vehicle, aircraft where he has reason to suspect that such assets, books of account or other documents, or such information in electronic form or on a computer system are kept

• Require any person, who is found to be in possession or control of any books of account or other documents maintained in the form of electronic record or any information in electronic form or on a computer system, to afford the authorised officer with such reasonable technical and other assistance (including access code, by whatever name called) as may be necessary to enable the authorised officer to inspect such books of account or other documents or such information;

• Break open the lock of any door, box, locker, safe, almirah, or other receptacle or override the access code to any computer system, where the keys or the access to such building, place, etc., or the access code to such computer system, as the case may be, is not available;

• Search any person who has got out of, or is about to get into, or is in, the building, place, vessel, vehicle or aircraft, if the authorised officer has reason to suspect that such person has secreted about his person any such books of account, other documents, any information in electronic form, or a computer systems or asset;

• Place marks of identification on any books of account or other documents, or make or cause to be made extracts or copies therefrom and also from computer system;

• Make a note or an inventory of any such asset, and stock-in-trade of the business, found as a result of such search;

• Seize any such books of account, other documents, computer systems or asset (other than stock-in-trade of the business), found as a result of such search.