Latest news with #Income-TaxAct
The Hindu
3 days ago
- Business
- The Hindu
Parliamentary panel retains Income Tax Bill provisions allowing tax officials to forcibly access social media, private email
The Parliamentary Select Committee appointed to review the new Income Tax Bill 2025 proposed by the government has retained the provisions in the new Bill empowering tax officials to access, forcibly if necessary, the social media and private emails of people they are conducting search and seizure operations on. The Income Tax Bill 2025 was introduced in the Lok Sabha in February 2025. The aim behind the Bill, as per the government, is to simplify and rationalise the existing Income Tax Act 1961 and the numerous amendments that have been made to it over the decades since it was introduced. It was then sent to a Select Committee, chaired by Baijayant Panda, for a review. The government on Monday (July 21, 2025) tabled the 4,575 page report in the Lok Sabha. The new Bill's expanded scope of powers given to tax officials during search and seizure operations has drawn criticism and calls for change, including from the experts the Select Committee consulted during its review. Stricter searches According to the new Bill, if a person is found to be in possession or control of any books of account, or other documents and information maintained digitally, on computer systems, or stored electronically, then they must provide the designated income tax officer 'reasonable technical and other assistance (including access code, by whatever name called) as may be necessary' to enable the officer to inspect 'any information, electronic records and communication or data contained in or available on such computer systems'. Further, the Bill also says that the authorised officer can gain access to these electronic systems by 'overriding the access code to any said computer system, or virtual digital space, where the access code thereof is not available'. A 'virtual digital space' includes social media accounts, online investment accounts, trading accounts, bank accounts, remote server or cloud server, and digital application platforms. According to the report, the stakeholders the Committee consulted during its examination of the Bill raised red flags regarding these provisions. Changes 'not feasible' The stakeholders suggested that the power to gain the access codes of social media accounts be placed out of the purview of relevant sections of the new Bill. They also stated that the Bill should make clear that, if access is gained to personal email addresses and computer systems, the use of these accounts 'shall be made only to the extent it is relevant for Income-Tax Act and not for any purpose beyond the Income-tax Act'. Others suggested that 'tangible reasons for seeking access may be recorded in writing prior to any such activity being undertaken'. The Select Committee, however, has argued that the provisions in the new Bill are necessary and therefore suggested no changes to them. 'Various incriminating evidences and material are found/seized from electronic records including WhatsApp communications, emails, etc,' it said in its report. 'In most of the cases of search operation the taxpayers do not share the password/login credential of online forums/portals/e-mail accounts, etc. 'This is because various encrypted communication modes are being used by tax payers to communicate and discuss their unaccounted transactions,' it added. 'The amendment has been rightly made to rationalise the provisions. Thus, the suggestion is not feasible.' With regard to the stakeholders' suggestion that tangible reasons for providing access be provided, the Committee said this was 'not feasible' as it 'seeks to provide safeguard in the statute to prevent abuse of power by Revenue officials as well as protect the privacy of taxpayers'. Significant simplification According to the Committee's report, the new Bill is a big step forward in simplifying India's income tax legislation. The new Bill has pared down the number of words in the law to 2,59,676 from the 5,12,535 in the Income Tax Act 1961. The number of chapters have also been reduced to 23 from 47, and the number of sections have been slashed to 536 from 819. On the other hand, to provide greater clarity, the new Bill has increased the number of tables it incorporates to 57 from 18, and the number of formulae to 46 from 6. 'The language has been simplified making the document easy to read and understand,' the Committee's report noted. 'The drafting style of the new Bill is straightforward and clear, making the provisions easier to understand.' Redundancies and need for cross-referencing between Sections and Chapters have been eliminated,' it added. 'Greater clarity has been brought in the Act without any structural or policy changes and without disturbing the long-settled taxation principles.'
Hans India
3 days ago
- Politics
- Hans India
Fiery showdown on cards
New Delhi: The Union government on Sunday indicated its willingness to discuss in Parliament Operation Sindoor, a key Opposition demand at an all-party meeting on eve of the monsoon session, even as the INDIA bloc insisted that Prime Minister Narendra Modi should respond on the matter as well as on the US President's 'ceasefire' claims and SIR in Bihar. Sources said the Prime Minister is unlikely to respond in Parliament on these issues. However, Parliamentary Affairs Minister Kiren Rijiju asserted that the government will reply appropriately whenever a discussion takes place on Trump's ceasefire claims on the India-Pakistan conflict. After the customary all-party meeting ahead of the session beginning on Monday, Rijiju said the government has sought the Opposition's cooperation in the smooth running of Parliament during the month-long session. There should be government-Opposition coordination in running Parliament smoothly, Rijiju told reporters after the meeting chaired by Union Minister J P Nadda. He said they heard the Opposition and ruling NDA alliance members patiently and hoped the upcoming session would be very productive. As many as 54 leaders of different parties and Independent MPs participated in Sunday's all-party meeting. 'We are very open to a discussion on important issues like Operation Sindoor. These are issues of great national importance. The government is not shying away and will never shy away, but is open to discussions within rules, conventions,' Rijiju asserted. Noting that the government accords importance to 'niyam' (rules) and 'parampara' (conventions), he said the matters raised at the meeting would be taken up at the Business Advisory Committee of both houses, where a final decision would be taken. 'We have noted all the points. We have requested all parties (to ensure) the Parliament functions properly. Have to ensure coordination. It is the responsibility of all to help Parliament function,' he said. Rijiju also said that the government has noted the demand for allocation of more time to parties with fewer MPs to speak in Parliament.' 'We will try and provide adequate time to all, including smaller parties,' he said. On the Opposition's demand for PM Modi to make a statement on the Pahalgam attack and other issues, Rijiju said, 'I want to make it clear that the Prime Minister remains in Parliament except during foreign travel. Whenever Parliament functions, Cabinet ministers are present to respond to issues concerning their departments.' Rijiju said the government is bringing 17 key bills, details of which would be provided soon. Topping the government's list is the Income-Tax Bill, 2025, which was introduced during the Budget Session on February 13. The Bill represents a major overhaul of the Income-Tax Act, 1961, aiming to simplify its language and structure. Sources said even the BJP's allies want that there should be a discussion on Operation Sindoor to highlight the achievements of the government after delegations visited different nations. After the meeting, Congress leader Gaurav Gogoi told reporters that his party sought PM Modi's statement on Trump's claims, 'lapses' which led to the Pahalgam attack and Special Intensive Revision (SIR) of poll rolls in Bihar. He said it was incumbent and moral responsibility of PM Modi to give a statement in Parliament on key issues raised by his party. 'We hope that the PM will fulfil his moral duty,' he said.
The Hindu
16-07-2025
- Business
- The Hindu
Parliamentary panel clears Income Tax Bill 2025 with 285 suggestions, to be tabled in Monsoon Session
The Select Committee of Parliament that examines the Income Tax Bill-2025 is learnt to have finalised its report on Wednesday (July 16, 2025) with about 285 suggestions to change the legislation. The committee, headed by senior BJP MP Baijayant Panda, is likely to submit the report in the upcoming Monsoon Session of Parliament. Introduced in Lok Sabha on February 13, 2025, the Bill was referred to a Select Committee on the same day with instructions to report by the first day of Monsoon Session. Finance Minister Nirmala Sitharaman had announced in the 2024 budget that the Centre will comprehensively review the Income-Tax Act, 1961 in a time-bound manner to make it concise and easily understandable. 'Accordingly, the Income-Tax Bill, 2025 has been prepared which proposes to repeal and replace the Income Tax Act, 1961,' the Minister said in the statement of objects and reasons of the Bill. She added that the Income Tax Act passed in 1961 has been subjected to numerous amendments since its passage. 'As a result of these changes, the basic structure of the Income Tax Act has been overburdened and the language has become complex, increasing cost of compliance for taxpayers and hampering efficiency of direct tax administration. Tax administrators, practitioners and taxpayers have also raised concerns about the complicated provisions and structure of the Act,' she said. The Opposition had raised apprehensions on certain provisions of the Act and had alleged that it provides for misuse of power by authorities.
The Hindu
29-06-2025
- Business
- The Hindu
Revisit digital search powers under the I-T Bill 2025
The Finance Minister recently introduced a proposal in Parliament to allow tax authorities to access, under the Income-Tax Bill, 2025, an individual's 'virtual digital space' during search and seizure operations. The justification is straightforward: as financial activity moves online, so must enforcement. However, this glosses over the far-reaching implications of such a shift, which raises significant concerns about privacy, overreach, and surveillance. A blurring, open-ended Currently, India's tax law already provides for search and seizure under Section 132 of the Income-Tax Act, 1961. But those powers are limited to physical space such as a house, office, and locker. Since such operations are based on suspicion of undisclosed income or assets, there is a connection between the objective, which is finding undisclosed income and getting access to physical assets. The new Bill, however, blurs this link by including an individual's digital presence which is not only vast but often contains much more than what is relevant to a tax investigation. Without clear limits, such access can lead to disproportionate intrusion. For example, under the existing regime, what could be searched was what concerned only the individual under investigation. In contrast, digital spaces involve multiple stakeholders. Accessing a social media account also exposes friends, family, and professional contacts, through photographs and posts. The proposed definition of 'virtual digital space' includes access to emails, personal cloud drives, social media accounts, digital application platforms, and more. Crucially, the phrase 'any other space of similar nature' makes the list open-ended, potentially covering a wide range of digital platforms. Additionally, the proposed provision empowers tax authorities to override access codes to gain entry into electronic devices or virtual digital spaces. It still remains unclear though how this power will be operationalised in practice particularly in cases involving encrypted messaging apps such as WhatsApp, as explicitly cited by the Finance Minister in Parliament. The problem becomes even more of a concern when the individual involved is a professional whose work requires confidentiality. For instance, journalists whose devices and emails hold sensitive information, including confidential sources, unpublished material, and protected communications. If a search is conducted on flimsy or overly broad grounds, it not only violates their privacy but also endangers their ability to undertake reporting. Recognising the risks, the Supreme Court of India, in 2023, circulated interim guidelines on the seizure of digital devices and directed the Union Government to contemplate formulating necessary protocols. Moreover, the judicial interpretation of 'reason to believe' emphasises the need for tangible material beyond mere suspicion. Even under existing law, courts have construed that the provision ought to be exercised strictly, acknowledging that search and seizure is a serious invasion of privacy. A violation of transparency, accountability Yet, the proposed provision goes against these principles and is devoid of guardrails, judicial oversight, and has a lack of understanding of the stakes. It fails to acknowledge, let alone address, the sheer breadth and layered sensitivity of information stored on electronic devices. In line with the current law, the proposed provision prohibits disclosure of the 'reason to believe' clearly violating principles of transparency and accountability. Globally, privacy and transparency standards in search and seizure, especially where digital devices are involved, are grounded in statutory protections and procedural safeguards. In Canada, Section 8 of the Charter of Rights and Freedoms guarantees the right to be secure against 'unreasonable search or seizure'. It is designed to prevent unjustified searches and sets a three-part default standard: prior authorisation; approval by a neutral and impartial judicial authority; and reasonable and probable grounds. In the United States, the Taxpayer Bill of Rights, adopted by the Internal Revenue Service, affirms that taxpayers have the right to expect that any inquiry or enforcement action will be legally compliant and will not be more intrusive than necessary following due process rights, including search and seizure protections. The U.S. Supreme Court's decision in Riley vs California also necessitated a warrant before accessing digital data, given the deeply personal nature of information stored on phones and devices. Contradiction of proportionality test In contrast, India's proposed Income Tax provision grants sweeping access to digital personal data without warrants, relevance thresholds, or any distinction between financial and non-financial information. This directly contradicts the proportionality test upheld by the Supreme Court in Justice K.S. Puttaswamy (Retd.) vs Union Of India. The Court has held that any restriction to an individual's privacy must meet a four-fold test, of which proportionality was key, requiring state action to pursue a legitimate aim, satisfy necessity and adopt the least intrusive means available. Allowing unfettered access to personal digital data, in the absence of judicial oversight or safeguards, fails this standard. The way forward is not to abandon digital enforcement altogether. Rather, it is to root it firmly in principles of proportionality, legality, and transparency. The right to privacy cannot and must not be eroded under the garb of regulatory action. Unchecked surveillance in the name of compliance is not governance but overreach. There is hope that the Select Committee which is currently reviewing the Bill narrows the definition of 'virtual digital space', and mandates prior judicial warrants and disclosure of reasons for such access to digital content in addition to establishing mechanisms of redress for aggrieved individuals. Mahwash Fatima is a Manager, Public Policy at TQH Consulting's technology practice in Delhi
Time of India
17-06-2025
- Business
- Time of India
Max 60 tax audits per partner likely: ICAI
A partner of an accounting firm will be allowed to take up a maximum of 60 tax audits in a year from FY27, Institute of Chartered Accountants of India (ICAI) president Charanjot Singh Nanda said. This would discourage a concentration of audit assignments with only a few senior partners at accounting firms and curb any anti-competitive conduct, he indicated. ICAI, in its council meeting in late May, decided to alter the guidelines and the new ones would be notified soon, Nanda told ET. Play Video Pause Skip Backward Skip Forward Unmute Current Time 0:00 / Duration 0:00 Loaded : 0.00% 0:00 Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 1x Playback Rate Chapters Chapters Descriptions descriptions off , selected Captions captions settings , opens captions settings dialog captions off , selected Audio Track default , selected Picture-in-Picture Fullscreen This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Opacity Opaque Semi-Transparent Text Background Color Black White Red Green Blue Yellow Magenta Cyan Opacity Opaque Semi-Transparent Transparent Caption Area Background Color Black White Red Green Blue Yellow Magenta Cyan Opacity Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Drop shadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Daughter thought she had saved 'cute bunnies.' The vet pales when he realizes what they really are Cleverst Undo As per extant guidelines, while a single chartered accountant operating on their own can undertake up to 60 tax audits in a fiscal year, a partnership firm, as a whole, is allowed to conduct audits up to the combined limit of all its partners. This often results in senior partners at these firms using the quota of their junior colleagues after exhausting their own limit. Live Events "The limit of 60 would be the aggregate limit (under the new guidelines) in respect of all tax audits signed by a member, both in his individual capacity and as a partner of an accounting firm," Nanda said. "Moreover, a partner of a firm won't be able to sign any tax audit report on behalf of any other partner," he added. However, this limit won't include audit assignments arising out of certain legal requirements under the Income-Tax Act. "It's not about limiting a senior partner's audit ability. The idea is to ensure that all auditors spend quality time on the audit assignments that they take up and deliver quality reports," said a member of the ICAI's Central Council.
