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Informist, Tuesday, Feb. 10, 2026

 

NEW DELHI – The Supreme Court Tuesday said it will examine a public interest litigation challenging the power of the income tax department to search and seize virtual digital spaces like personal digital devices and cloud servers. The top court said a limited judicial review of search actions of the income tax department was already recognised in its 2022 judgment. Under the law, tax authorities can conduct searches when there is a "reason to believe" that income has been concealed.

 

The bench led by Chief Justice of India Surya Kant said that courts can examine whether there is a rational nexus between the material available with the income tax authorities and the belief recorded for initiating a search. The provisions allowing searches based on apprehension of non-compliance exist to prevent destruction of evidence, said the bench, also comprising Justice Joymalya Bagchi and N.V. Anjaria.

 

The court remarked that much of the digital evidence is stored on devices or in the cloud, and without search powers, investigations could be frustrated. "If notice is given for this search and seizure, there is a potential for destroying the evidence. The best way to snub out such an investigation against the digital record is to destroy the device itself," remarked the bench. The top court observed that the income tax authorities' power is not uncontrolled, as it operates subject to pre-conditions, and added that the challenge is based on apprehension at this stage. It will now hear the case next on Mar. 9.

 

The petitioner Vishwaprasad Alva, an entrepreneur, has challenged the provision in the Income Tax Act, 1961 and the corresponding provision in the Income Tax Act, 2025, that allegedly permitted highly intrusive searches of digital devices such as laptops and mobile phones, as well as access to emails, private chats, cloud-stored data, and other electronic information without any prior judicial approval. This amounts to a serious invasion of informational privacy protected under Article 21 of the Constitution, said the petitioner.

 

Alva argued that the clauses create an "anticipatory search" framework, where search powers can be exercised even without any existing violation of tax law. Less intrusive mechanisms such as summons, surveys, and assessments already exist under the law, and allowing full-scale digital searches on speculative grounds fails the test of proportionality, said Alva.  End

 

Reported by Surya Tripathi

Edited by Ashish Shirke

 

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