I.T.BILL 2025 AND PRIVACY INVASION

I.INTRODUCTION

1.The chatter is constant: invasion of privacy!’, ‘’big brother is watching you from 1.4.26!’,social media accounts,e-mails,cloud storage,trading platforms,investment accounts,digital transactions,online assets-all are under the scanner with attendant cybersecurity risks.

1.1 People are getting angry:a cybersecurity expert writes on Linkedin in a public post that privacy is not a govt charity and cites Puttaswamy decision.It is not governance but surveillance;who will watch the watchers,potential for misuse,selective targeting possible ,harassment tool,their own systems are not secure,our data is breached,erosion of personal freedom,free speech under threat,spying on citizens- all form part of the erudite expert’s tirade.All digital space,in short, is under threat.

Let’s be a little even handed here and look at what the law was and what has changed, before deciding the implications.

II. THE EXISTING LAW(RELEVANT PART).IT ACT 1961

2. The statute:
132. Search and seizure—

(1) Where the Principal Director General, Director General or Principal Director or Director or the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner or Additional Director or Additional Commissioner or Joint Director or Joint Commissioner, in consequence of information in his possession, has reason to believe that—

(the officer so authorised in all cases being hereinafter referred to as the authorised officer) to—……….

(iib) 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 as defined in clause (t) of sub-section (1) of section 2 of the Information Technology Act, 2000 (21 of 2000), to afford the authorised officer the necessary facility to inspect such books of account or other documents;………. Inserted by Act 20 of 2002, Section 56 (w.e.f. 1.6.2002).

(13) The provisions of the Code of Criminal Procedure, 1973 (2 of 1974), relating to searches and seizure shall apply, so far as may be, to searches and seizure under sub-section (1) or sub-section (1A).

“275B. Failure to comply with the provisions of cl. (iib) of sub-s. (1) of s. 132 : If a person who is required to afford the authorised officer the necessary facility to inspect the books of account or other documents, as required under cl. (iib) of sub-s. (1) of s. 132, fails to afford such facility to the authorised officer, he shall be punishable with rigourous imprisonment for a term which may extend to two years and shall also be liable to fine.”

2.1This is to be noted.Everyone is neither under surveillance as of now.Where a search and seizure operation takes place(perfectly acceptable to all naysayers too ,since its existing for years without objection).

2.2 Its here that ‘’electronic record as defined in clause (t) of sub-section (1) of section 2 of the Information Technology Act, 2000 (21 of 2000),’’ is required to be given access to .And towards what end?: afford the authorised officer the necessary facility to inspect such books of account or other documents;………. Inserted by Act 20 of 2002, Section 56 (w.e.f. 1.6.2002).

TO INSPECT-books and other DOCUMENTS.That is it.That is it.

What is covered in clause t of IT Act 2000 is given in next part of this article.
3.THE LEGISLATIVE BACKGROUND TO THE EXISTING PROVISION OF 1961 ACT

3.1.Finance bill 2001: CHAPTER III: DIRECT TAXES: Income-tax: Amendment of section 2.
Amendment of section 2.

3. In section 2 of the Income-tax Act,—

(a) after clause (12), the following clause shall be inserted with effect from the 1st day of June, 2001, namely:—
‘(12A) “books or books of account” include ledgers, day-books, cash books, account-books and other books, whether kept in the written form or as print-outs of data stored in a floppy, disc, tape or any other form of electro-magnetic data storage device;’;
(b) after clause (22A), the following clause shall be inserted with effect from the 1st day of June, 2001, namely:—
‘(22AA) “document” includes an electronic record as defined in clause (t) of sub-section (1) of section 2 of the Information Technology Act, 2000 (21 of 2000);’;

3.1.1.Memorandum to Finance Bill 2001

Defining ‘Books of Account’ and ‘Document’ so as to include electronic records etc.
With the passing of the Information Technology Act, 2000, it is accordingly proposed to insert definitions of ‘books or books of account’ and ‘document’ in section 2 of the Income-tax Act, as follows: “books or books of account” include ledgers, day- books, cash books, account-books and other books whether kept in written form or as print-outs of data stored in a floppy disc, tape or any other form of electro-magnetic data storage device; “document” includes an electronic record as defined in clause (t) of section 2 of the Information Technology Act, 2000. The proposed amendment will take effect from 1st June, 2001.

3.2.Finance bill 2002

Amendment of section 132.
53. In section 132 of the Income-tax Act, with effect from the 1st day of June, 2002,—
(a) in sub-section (1), after clause (iia), the following clause shall be inserted, namely:–

“(iib) 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 as defined in clause (t) of sub-section (1) of section 2 of the Information Technology Act, 2000, to afford the authorised officer the necessary facility to inspect such books of account or other documents;”;

3.2.2. Memorandum to finance bill 2002

Strengthening of provisions relating to search and seizure

Under the existing provision contained in sub-section (1) of section 132 of the Income-tax Act, the authorised officer is empowered inter alia, to enter and search any building, place, vessel, vehicle, or aircraft and seize any books of account or other documents found as a result of search.

With a view to make search operations more effective, it is proposed to amend sub-section (1) to provide that in addition to the powers specified therein, the authorised officer shall also have the power to 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 records, to afford the necessary facility to the authorised officer to inspect all such books of account or other documents.

It is further proposed to insert a new section 275B in the Income-tax Act to provide that if any person who is required to afford such facility to the authorised officer, fails to do so, he shall be punishable with rigorous imprisonment for a term, which may extend to two years and shall also be liable to fine.

It is also proposed to insert a reference to section 275B in sub-section (1) of section 279 of the Income-tax Act, so as to provide that a person shall not be proceeded against for an offence under section 275B except with the previous sanction of any of the authorities specified in section 279.

These amendments will take effect from 1st June, 2002 and will, accordingly, apply in relation to a search initiated or requisition made on or after that date.
[Clauses 53, 103 and 104]

III. THE THIRD ANGLE OF THE TRIANGLE : THE INFORMATION TECHNOLOGY ACT, 2000

4.Information Technology Act came into existence in the year 2000 and provided for regulatory and punitive measures.Seminal changes happened in the same in the year 2009.Relevant part is encapsulated below:
ACT NO. 21 OF 2000
[9th June, 2000.]

An Act to provide legal recognition for transactions carried out by means of electronic data interchange and other means of electronic communication, commonly referred to as ―electronic commerce‖, which involve the use of alternatives to paper-based methods of communication and storage of information, to facilitate electronic filing of documents with the Government agencies and further to amend the Indian Penal Code, the Indian Evidence Act, 1872, the Banker’s Books Evidence Act, 1891 and the Reserve Bank of India Act, 1934 and for matters connected therewith or incidental thereto.

WHEREAS the General Assembly of the United Nations by resolution A/RES/51/162, dated the 30th January, 1997 has adopted the Model Law on Electronic Commerce adopted by the United Nations Commission on International Trade Law;

AND WHEREAS the said resolution recommends inter alia, that all States give favourable consideration to the said Model Law when they enact or revise their laws, in view of the need for uniformity of the law applicable to alternatives to paper-based methods of communication and storage of information;

AND WHEREAS it is considered necessary to give effect to the said resolution and to promote efficient delivery of Government services by means of reliable electronic records.
BE it enacted by Parliament in the Fifty-first Year of the Republic of India as follows:—
CHAPTER 1

2. Definitions.—(1) In this Act, unless the context otherwise requires,—

3[(ha) ―communication device‖ means cell phones, personal digital assistance or combination of both or any other device used to communicate, send or transmit any text, video, audio or image;]

(i) ―computer‖ means any electronic, magnetic, optical or other high-speed data processing device or system which performs logical, arithmetic, and memory functions by manipulations of electronic, magnetic or optical impulses, and includes all input, output, processing, storage, computer software or communication facilities which are connected or related to the computer in a computer system or computer network;

4[(j) ―computer network‖ means the inter-connection of one or more computers or computer systems or communication device through–

(i) the use of satellite, microwave, terrestrial line, wire, wireless or other communication media; and

(ii) terminals or a complex consisting of two or more interconnected computers or communication device whether or not the inter-connection is continuously maintained;]
(k) ―computer resource‖ means computer, computer system, computer network, data, computer data base or software;
(l) ―computer system‖ means a device or collection of devices, including input and output support devices and excluding calculators which are not programmable and capable of being used in conjunction with external files, which contain computer programmes, electronic instructions, input data and output data, that performs logic, arithmetic, data storage and retrieval, communication control and other functions;

3. Ins. by Act 10 of 2009, s. 4, ibid. (w.e.f. 27-10-2009).

4. Subs. by s. 4, ibid., for clause (j) (w.e.f. 27-10-2009).

(r) ―electronic form‖ with reference to information, means any information generated, sent, received or stored in media, magnetic, optical, computer memory, micro film, computer generated micro fiche or similar device;….

(t) ―electronic record‖ means data, record or data generated, image or sound stored, received or sent in an electronic form or micro film or computer generated micro fiche;………..

Also:

(o) ―data‖ means a representation of information, knowledge, facts, concepts or instructions which are being prepared or have been prepared in a formalised manner, and is intended to be processed, is being processed or has been processed in a computer system or computer network, and may be in any form (including computer printouts magnetic or optical storage media, punched cards, punched tapes) or stored internally in the memory of the computer;

(v) ―information‖ includes 2[data, message, text,] images, sound, voice, codes, computer programmes, software and data bases or micro film or computer generated micro fiche;

5. CHAPTER XI : OFFENCES

[INTRUSIVE INTERCEPTION]*
2[69. Power to issue directions for interception or monitoring or decryption of any information through any computer resource.–(1) Where the Central Government or a State Government or any of its officers specially authorised by the Central Government or the State Government, as the case may be, in this behalf may, if satisfied that it is necessary or expedient so to do, in the interest of the sovereignty or integrity of India, defence of India, security of the State, friendly relations with foreign States or public order or for preventing incitement to the commission of any cognizable offence relating to above or for investigation of any offence, it may subject to the provisions of sub-section (2), for reasons to be recorded in writing, by order, direct any agency of the appropriate Government to intercept, monitor or decrypt or cause to be intercepted or monitored or decrypted any information generated, transmitted, received or stored in any computer resource.

(2) The procedure and safeguards subject to which such interception or monitoring or decryption may be carried out, shall be such as may be prescribed.

(3) The subscriber or intermediary or any person in-charge of the computer resource shall, when called upon by any agency referred to in sub-section (1), extend all facilities and technical assistance to–

(a) provide access to or secure access to the computer resource generating, transmitting, receiving or storing such information; or

(b) intercept, monitor, or decrypt the information, as the case may be; or
(c) provide information stored in computer resource.

(4) The subscriber or intermediary or any person who fails to assist the agency referred to in sub-section (3) shall be punished with imprisonment for a term which may extend to seven years and shall also be liable to fine.

2. Subs. by s. 34, ibid., for section 69 (w.e.f. 27-10-2009).
Surveillance*

69B. Power to authorise to monitor and collect traffic data or information through any computer resource for cyber security.

.–(1) The Central Government may, to enhance cyber security and for identification, analysis and prevention of intrusion or spread of computer contaminant in the country, by notification in the Official Gazette, authorise any agency of the Government to monitor and collect traffic data or information generated, transmitted, received or stored in any computer resource.

(2) The intermediary or any person in-charge or the computer resource shall, when called upon by the agency which has been authorised under sub-section (1), provide technical assistance and extend all facilities to such agency to enable online access or to secure and provide online access to the computer resource generating, transmitting, receiving or storing such traffic data or information.

(3) The procedure and safeguards for monitoring and collecting traffic data or information, shall be such as may be prescribed.

(4) Any intermediary who intentionally or knowingly contravenes the provisions of sub-section (2) shall be punished with an imprisonment for a term which any extend to three years and shall also be liable to fine.

Explanation.–For the purposes of this section,–

(i) ―computer contaminant‖ shall have the meaning assigned to it in section 43;
(ii) ―traffic data‖ means any data identifying or purporting to identify any person, computer system or computer network or location to or from which the communication is or may be transmitted and includes communications origin, destination, route, time, data, size, duration or type of underlying service and any other information.]
*caption added

5.1 The State always had the power.Surveillance need not be done via Income Tax Act then.The INF.TECH. Act above is enough,was enough and found no vociferous objections in last 25 years.Nothing new needs/was needed to be done by the State.All that happened that a wing of the executive was extended the authority for a specific purpose.That power to extend too was there-ref s 69 Inf.Tech Act(supra).

5.2This is where IT Deptt faltered in introducing the new provisions which has raised the hackles of everybody.All it needed was a comprehensive executive/legislative license to operate in the domain of 2000 Act.They not only missed this out but created a major faux pas by creating new clause 261,which we shall see presently.

IV.THE TRIGGER CAUSE : INCOME TAX BILL 2025

6.The proposed law(the relevant part):

Clause 247. (1) Where the competent authority, in consequence of information in his possession, has reason to believe that—
…………..
then the approving authority may authorise …………the authorised officer to

(ii) 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 [as defined in section 2(1)(ha), (i), (j), (k), (l), (r), and (t) of the Information Technology Act, 2000], on computer systems, any information stored in an electronic media or computer systems, 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 any information, electronic records and communication or data contained in or available on such computer systems; ……..

(iii) 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;.

(vii) 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; …….

(4) The authorised officer may, where it is not practicable to seize, any such books of account, other documents, computer systems, asset, bank locker, bank account, for reasons other than deemed seizure under of sub-section (1) (viii),––

(a) serve an order on the owner or the person who is in immediate possession or control thereof, not to remove, part with or otherwise deal with it except with the previous permission of such officer and take such steps as may be necessary for ensuring compliance with the order ……..

(7) Where any books of account (in physical form or electronic form), other documents or asset, is found in the possession or control of any person in the course of a search, it may be presumed—

(a) that such books of account, computer systems, virtual digital space, other documents or asset, belong or belongs to such person;

(b) that the contents of such books of account, other documents, electronic content, records or communication found on such computer systems or virtual digital space, are true;

(c) that the signature and every other part of such books of account and other documents which purport to be in the handwriting of any particular person or which may reasonably be assumed to have been signed by, or to be in the handwriting of, any particular person, are in the handwriting of that person; and

(d) in the case of a document stamped, executed or attested, that it was duly stamped and executed or attested by the person by whom it purports to have been so executed or attested, and that the electronic records, data, communication, and information exchange carried out using such electronic devices is presumed to be exchanged between the parties thereto.

(10) The provisions of the Bharatiya Nagarik Suraksha Sanhita, 2023 relating to searches and seizure shall apply, so far as may be, to search and seizure under this section.

Clause 474. If a person, who is required to afford the authorised officer with the necessary facility to inspect the books of account or other documents under section 247(1)(b)(ii) fails to do so, he shall be punishable with rigorous imprisonment for a term which may extend to two years and shall also be liable to fine.

7.WHAT CHANGED?

There was no social media in the year 2000 when Inf Tech Act got enacted.In the year 2009 ,when the same was in nascent stage ,the 2009 amendments came.

What changed ?:

7.1 IN 1961 ACT:

(iib) 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 as defined in clause (t) of sub-section (1) of section 2 of the Information Technology Act, 2000 (21 of 2000), to afford the authorised officer the necessary facility to inspect such books of account or other documents;………. Inserted by Act 20 of 2002, Section 56 (w.e.f. 1.6.2002).

VS

IN 2025 BILL:

(ii) 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 [as defined in section 2(1)(ha), (i), (j), (k), (l), (r), and (t) of the Information Technology Act, 2000], on computer systems, any information stored in an electronic media or computer systems, 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 any information, electronic records and communication or data contained in or available on such computer systems; ……..

Penal consequences for non compliance were in s 275B earlier and are in clause 474 now- identical.

7.2 Earlier ,passive help was needed:’’ to afford the authorised officer the necessary facility’’

Now active involvement is directed:’’ to afford the authorised officer with such reasonable technical and other assistance (including access code, by whatever name called)’’

7.3 Earlier,only clause (t) of sub-section (1) of section 2 was invoked:

(t) ―electronic record‖ means data, record or data generated, image or sound stored, received or sent in an electronic form or micro film or computer generated micro fiche;………..
Vs
Now,’’ electronic record [as defined in section 2(1)(ha), (i), (j), (k), (l), (r), and (t) of the Information Technology Act, 2000],’’…….

This has got the cyber and privacy army up in arms.

8.However,law is not read like literature.If you look at these provisions in Information Technology Act ,2000(hereinafter the 2000 IT ACT] in isolation it would indeed appear that all your private digital space is under omnibus threat.In fact I would say that the provision creates huge interpretational spaces where some judicial cleavage may occur but majorly ,the undue intrusion ,would be easily challengable in Courts,unless pre empted at bill stage.

Why is it so?

Construction of statutes and Interpretation of statutes are of assistance here.
What is the department authorized to look at?: ‘’ any books of account or other documents’’ .

Which are : ‘as defined in s 2(12A) and s 2(22A).(SUPRA)in 1961 Act.
In the new bill:

2(19) “books or books of account” includes ledgers, day-books, cash books, account-books or other books, whether kept–– (a) in written form; or (b) in electronic or any digital form, or on cloud based storage, or on any electromagnetic data storage device, such as floppy, disc, tape, portable data storage device, external hard drives, or memory cards; or (c) as print-outs of data stored in electronic or digital form or on storage devices mentioned in sub-clause (b);

2(41) “document” includes an electronic record as defined in section 2(1)(t) of the Information Technology Act, 2000;

9.Are your mobile phones under threat of privacy invasion? Can they be seized?

Here a self goal seems to have occurred in drafting.

Let’s dissect clause 247 a bit.

(ii) 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 [as defined in section 2(1)(ha), (i), (j), (k), (l), (r), and (t) of the Information Technology Act, 2000], on computer systems,
+
any information stored in an electronic media or computer systems,
+
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 any information, electronic records and communication or data contained in or available on such computer systems;
The mandate is defined and limited in the last lines .

(vii) 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;

9.1 Where can a mobile be classified?It surely isn’t books or documents.So it can only be computer systems.

2000 I.T.Act defines it as:

(l) ―computer system‖ means a device or collection of devices, including input and output support devices and excluding calculators which are not programmable and capable of being used in conjunction with external files, which contain computer programmes, electronic instructions, input data and output data, that performs logic, arithmetic, data storage and retrieval, communication control and other functions;

But the Bill defines it differently:

Clause 261( e ): “computer system” means computers, computer systems, computer networks, computer resources, communication devices, digital or electronic data storage devices, used on stand-alone mode or part of a computer system, linked through a network, or utilised through intermediaries for information creation or processing or storage or exchange, and includes the remote server or cloud server or virtual digital space;

(i) “virtual digital space” means an environment, area or realm, that is constructed and experienced through computer technology and not the physical, tangible world which encompasses any digital realm that allows users to interact, communicate and perform activities using computer systems, computer networks, computer resources, communication devices, cyberspace, internet, worldwide web and emerging technologies, using data and information in the electronic form for creation or storage or exchange and includes––

(i) email servers;
(ii) social media account;
(iii) online investment account, trading account, banking account, etc.;
(iv) any website used for storing details of ownership of any asset;
(v) remote server or cloud servers;
(vi) digital application platforms; and
(vii) any other space of similar nature.

9.2 What has happened is a botched up attempt to camouflage ‘’communication device’’ under the generic ‘’computer system’’. But the bag is empty and the cat is out.And the confidence in bonafide is gone.

In Inf.Tech Act a computer system is defined separately in s 2(1)(l) and communication device in s 2(1)(ha).The tax bill tries to smuggle in ,unnaturally ,a mobile phone ,threrein but fails to define it in s 261.So the definition of Inf.Tech Act comes into play –where the two are apart.So how will revenue define a communication device?The bill is silent and it again creates interpretational space . If we use the concept of noscitur a socci(‘’ a word is known by the the company it keeps’’) the communication device must be part of the genus ,computer system.Is it?

[ The technically correct definition in 2000 I.T. Act has been abandoned .So going in that space creates litigation.]

Short of that ,a communication device has to be read with computer this or computer that.Why is revenue shy to write the term ‘’cell phone’’ as written in IT Act 2000?(or that too is hiding somewhere?!) When all definitions were being written in s 261 ,why not import defn of these terms from 2000 Act? So ,would they use I.T.Act 2000 for definition of communication device?An Act which they are using and discarding at will ? They have not said that the communication device means the same as in 2000Act ,the oblique reference in opening part of clause notwithstanding since it is used in different context?
Litigation beckons.

9.2.1The definition of virtual digital space gives away the pathetic subterfuge when e mails ,social media a/cs start getting mentioned.

10.There is another contradiction.In clause 247(1)(ii) the sections of I.T.ACT 2000 are mentioned which include ‘’computer system’’-but as defined in 2000 Act –in clause ‘l’.:’’ …..of electronic record [as defined in section 2(1)(ha), (i), (j), (k), (l), (r), and (t) of the Information Technology Act, 2000], on computer systems, any information stored in an electronic media or computer systems,……..

Which is this computer system’?The one in 2000 Act or the one in 2025 bill?

11.Also ,the bill says ‘’electronic record’’ as defined in………But this is patently incorrect.Because ‘’electronic record’’ is defined separately in 2000 Act in a clause not covered by the income tax bill!To wit,

(t) ―electronic record‖ means data, record or data generated, image or sound stored, received or sent in an electronic form or micro film or computer generated micro fiche;………..

That said, 247(1)(vii) permits seizure of ‘’computer systems’’.

11.The final aspect is preservation of integrity of evidence specially this one.You override access code,you open the systems.Then what?A concept hitherto used rarely ,though used big time in countries like USA comes into play- CHAIN OF CUSTODY.
Second,the probative value of such content too creates cleavaged interpretational spaces which make situation ripe for litigation.Wipe the dust off your jurisprudence books!
12.And what happens to the ‘’computer system’’ of the recipients?Will they be seized too?Because this is still one way street .You send a message on whatsapp for example…allegedly a clandestine business message with revenue implications.

What is the context?

What is the final fate?

Who is to know?

Can a one way communication create a taxable event?

Will the alleged transaction be deemed concluded?

What about necessity of corroborative evidence?

What of the burden of proof?

Because the affirmative claim basis of Burden of Proof in Evidence law will fail here- the whatsapp owner is making no claim at all.A claim is being attributed to him –so who will prove ?

Of course revenue has to.But a safeguard is created by them.

247 (7) Where any books of account (in physical form or electronic form), other documents or asset, is found in the possession or control of any person in the course of a search, it may be presumed—

(a) that such books of account, computer systems, virtual digital space, other documents or asset,; belong or belongs to such person

(b) that the contents of such books of account, other documents, electronic content, records or communication found on such computer systems or virtual digital space, are true;

(c) that the signature and every other part of such books of account and other documents which purport to be in the handwriting of any particular person or which may reasonably be assumed to have been signed by, or to be in the handwriting of, any particular person, are in the handwriting of that person; and

(d) in the case of a document stamped, executed or attested, that it was duly stamped and executed or attested by the person by whom it purports to have been so executed or attested, and that the electronic records, data, communication, and information exchange carried out using such electronic devices is presumed to be exchanged between the parties thereto.

This is a refurbished EXISTING s 132 (4A).It was subject to much litigation and there is no reason to believe it won’t be so under this new subsection 7.The presumptions herein and earlier too, are overcompensations of the law of presumption contained in the erstwhile IEA 1872 S 2(4) and now in s 2(h)of BSA 2023.

V.ANALYSIS:

13.Right to privacy was a part of Constituent Assembly advisory committee debates.But it never found place as a fundamental right.Till 2017 decision in Puttaswamy.

14.Surveillance is possible under the Indian Telegraph Act 1885 r/w Rules of 2007(419A) as well as IT Act 2000(S 69).Numerous agencies are already authorized therein .

15.Even the 2017 Judgement held that right to privacy can be curtailed on basis of ‘’procedure established by law’’.In State’s interest ,privacy can be breached.Tests of Proportionality and Exclusion were espoused therein.

16.It was not as if whatsapp chats have not been accessed and utilized for income assessment purposes in the existing Act.I have defended such cases myself .But what evidentiary value they have, has been subject to comment by judicial fora.

‘’ As per July 2021 Supreme court ruling in A2Z Infraservices Ltd. Vs. Quippo Infrastructure Ltd., it was held by a 3 judge bench comprising of the then Chief Justice N V Ramana, Justices A S Bopanna and Hrishikesh Roy, that mеssagеs еxchangеd on social mеdia platform WhatsApp havе no еvidеntial valuе and that thе author of such WhatsApp mеssagеs cannot bе tiеd to thеm, еspеcially in businеss partnеrships govеrnеd by agrееmеnts. The court opined that, “What is the evidential value of WhatsApp messages these days? Anything can be created and deleted on social media these days. We don’t attach any value to the WhatsApp messages”[source:https://www.lexology.com/library/detail.aspx?g=22e7d2c4-f54b-4543-b419-039a39f4e1fa ].

Conclusive evidence shall be defined by analysis of the same on jurisprudential principles not what income tax authorities deem it to be.

17.Any law,howsoever good, is liable for overreach of executive overenthusiasm as well as misinterpretation and malafide implementation.However ,some law/part thereof provide a convenient playfield for systemic abuse and catering to voyeuristic instincts of the implementing personnel.The non tax content can create a leverage for future’benefits’out of books.A simple printout taken and kept ,a cloned pen drive will do.It was famously said by a former CJI that ‘’corruption has become an acceptable way of life{and}judges don’t drop from heaven’’-if so ,the officers certainly don’t drop from heaven either.In a department not known for its integrity (and now not for competence and conduct too) the biggest indictment on this aspect came from within-in the form of faceless assessment and appeal scheme-one of the publicly stated objectives was ,to finish physical interface with the assessee to eliminate corruption.HT reports that the scheme’’ was rolled out to bring automation in the system, eliminate random individual discretion by tax officials, and control corruption.’’[https://www.hindustantimes.com/business/cbdt-reviewing-its-faceless-tax-assessment-scheme-report-101661245716502.html].

It famously failed to do so.Read https://theprint.in/india/faceless-assessment-scam-how-nexus-of-i-t-officers-cas-rigged-the-system-to-net-big-fish/2483927/

Not just that ,the scheme created humungous disruption technically.Read https://www.cnbctv18.com/business/faceless-tax-audit-creating-chaos-and-legal-log-jam-cbdt-alleges-industry-18343621.htm

18.If ‘’random exercise of discretion’’ and ‘’corruption’’ due to physical interface were an issue ,they still are (see reports above).

18.1 Also there is alarming increase in officers leaving the department. In fact the attrition rate since last 5-7 years in IRS is so huge that downsizing the cadre is not even needed .More are leaving ,less are coming.Its not even a preferred service anymore .Why is it so?Why are so many leaving the so called prestigious service?Its a public service in freefall. In such an atmosphere ,to vest such discretionary powers ,the validity of which wont even be challengable till HC,does not evoke confidence.The officers have been caught with their hand in the cookie jar with monotonous regularity to make us believe otherwise.

19.At which point implementation of law will become a matter of executive overreach is an issue.’’Your freedom ends where my nose begins’’-that’s the privacy sanctum sanctorum.In hunting for the elusive tax evasion all the personal e mails and chats which may contain intimate or private content ,nothing to do with the tax evasion, shall come in their domain.Would their word of keeping secrecy be enough?If one were to suddenly find very private details floating in public air ,would preponderance of probability not point to revenue? What is more sacrosanct and inviolabe? Personal space ,so wonderfully upheld in Puttaswamy ,or an alleged tax evasion documentation, which in all likelihood wont be there?

19.1 Forewarned ,if at all there is an incriminating digital trail, would it not be sanitised by the errant? What are the odds? Further, which joker would violate the law and then advertise it on Facebook or Instagram?In fact ,most social media profiles (for 15 minutes of fame seekers) are public anyway.Create fake profiles ,follow them and know incognito ,in real time, instead of a post facto exercise destined to fail on the testing field of probative evidence.

20.Further ,the taxmen are not business law experts .Even a business mail may not carry implications they may derive.Tax implications of complicated business transactions put in brief via a e mail or a whatsapp shall lead to interpretational cleavages between revenue and the owner of the message.So ,will the appellate authorities be the new battlegrounds for deciphering business correspondence? Honble Justice G. P. Singh writes in his “Principles of Statutory Interpretation”, 5th edition-1993 :”The problem of interpretation is a problem of meaning of words and their effectiveness as medium of expression to communicate a particular thought. A word is used to refer to some object or situation in the real world and this object or situation has been assigned a technical name referent. According to G. Williams in “Language and the law”, 61 Law Quarterly Review. page 73, “words and phrases are symbols that stimulate mental references to referents”. But words of any language are capable of referring to different referents in different context and times. Moreover, there is always the difficulty of borderline cases falling within or outside the connotation of a word. Language, therefore, is likely to be misunderstood.’’

21.And interpretation of the new statutes applied on the above, arguably with no precedents to interpret them?

Further cleavages?

This will create a different problem.For,as Justice Singh goes on to write further ,in continuation of the above quote ,that ‘’… In ordinary conversation or correspondence it is generally open for parties to obtain clarification if the referent is imperfectly communicated. The position is, however, different in the interpretation of statute law. A statute as enacted cannot be explained by the individual opinions of the legislators, not even by a resolution of the entire legislature.”

22.Will the remedy prove to be worse than the disease? Do the officers even understand how to process digital evidence or the concept of chain of custody ? A technocracy obsessed with computerization and procedures more than the hard letter of law is ill equipped to process the power-that’s the popular view and that’s what evidence tells us.Its a very thin line.But its inviolable.This is going to Courts ,folks –as precisely quoted in Interpretation of Statutes treatise of Justice G. P. Singh – the words of Lord Cranworth, L. C :

“There is no possibility of mistaking midnight for noon; but at what precise moment twilight becomes darkness is hard to determine.”

VI.THE FINAL WORD:

23. The probability of unreasonableness in interpretation of the items mentioned in clause 261 ( e)(i )tilts balance of convenience in favour of the owner of that space.The trouble is ,that if this is excluded now,it shall become ,by definition ,out of bounds…..till such time this remained in the gray (as in 1961 Act) it could be ‘legitimately’transgressed…not any more.

24.I have always held the firm belief that in fiscal laws, loose limbed sections are at times necessary to provide free play to realities of commerce and its multifarious dimensions as well as for just conclusions.Gray is a shade necessary in law for it to become an instrument in dispensation of justice.

24.1 Definitions in law and life are,at times, ugly-and unnecessary.Now we have defined the rainbow’s end.’Only there won’t be any pot of gold there.But there will be consequences.[For those who may be unaware of the nuance – The phrase “end of the rainbow” is a metaphor, as rainbows, being optical phenomena, are actually circles that appear as arcs and don’t have a physical end. The phrase is used to describe something that is unattainable or a distant.]

25.This being so ,with arbitrariness,unreasonableness ,discrimination and definite violation of privacy totally unrelated to any tax misdemeanour compels us to the golden observation In K. Rudra Rao vs. ITO (1951) 34 ITR 216(AP) at page 220 :”In administering a tax law, irritations to the assessee are inevitable; and officer if bound to do his duty irrespective of the susceptibilities of the assessee or even at the risk of hurting their amour propre. But this would not justify the officers functioning under the Act doing things in an unreasonable way. As has been pointed out by Maxwell on the Interpretation of Statutes, at page 123, tenth edition, all public officers in whom powers are vested by statutes must exercise those powers “within the limits to which an honest man competent to discharge of his office ought to confine himself, that is, within the limits and for the objects intended by the legislature.”

25.1My conclusion is simple: These are powers fit for Gods.Let only the Gods have them.

Posted on: March 20th, 2025