Bankers' Books Evidence Act, 2026 to Come Into Force on October 1

The Bankers' Books Evidence Act, 2026, which replaces the 1891 law governing the use of banking records as evidence, will come into force on October 1, the Ministry of Finance said. A notification dated September 10 appointed the commencement date, following the President's assent to the legislation on August 13.

The new law introduces a technology-neutral framework covering banking records kept in written or physical form as well as those stored electronically, digitally, virtually or at offsite and cloud locations, including backup and disaster recovery sites.

It also provides for simplified and standardised certification of banking records, with certificates permitted to be authenticated through manual, digital or electronic signatures. For electronic and digital records to be admissible as evidence, the Act lays down conditions concerning the proper functioning and regular use of computer systems, authorised data entry, protection against unauthorised changes, secure data transfer, and safeguards against tampering and cyber risks.

The framework sets clearer rules on when bank officials can be required to appear in legal proceedings where the bank is not a party. Such officials cannot be compelled to produce bankers' books or appear as witnesses unless a court identifies a "special cause" and records it in writing. The Act defines "special cause" to include doubts over the accuracy or genuineness of records, disruption in regular record-keeping, or non-compliance by a bank with a court order.

Beyond banks, the Central Government may extend the provisions of the Act to specified financial-sector entities or classes of entities, subject to conditions, exceptions or modifications notified by it.

The legislation repeals the Bankers' Books Evidence Act, 1891, while preserving rights, liabilities, investigations and legal proceedings arising under the repealed law. The Ministry said the reforms are intended to ensure that laws governing banking records keep pace with technological advancements and the evolving needs of the financial system, while promoting ease of doing business and modernising the legal and regulatory framework.