Internal and Forensic Audit · Forensic Audit and Indian Evidence Law

Forensic Audit and the Bharatiya Sakshya Adhiniyam, 2023

Updated 11 October 2026 · Fact-checked

A forensic audit produces findings meant to be used in court. The Bharatiya Sakshya Adhiniyam, 2023 decides what a court accepts as evidence. To answer a question, link each audit finding to a fact, show it is oral or documentary evidence, and test it against the Adhiniyam's rules on documents, secondary evidence and electronic records.

Understand Forensic Audit and the Bharatiya Sakshya Adhiniyam, 2023

A forensic audit is an audit done so that its results can stand up in a legal forum. A normal audit forms an opinion. A forensic audit builds a trail of proof that a court, tribunal or investigating agency can rely on.

The law that governs proof in courts is the Bharatiya Sakshya Adhiniyam, 2023. It came into force on 1 July 2024. It applies to all judicial proceedings in or before any Court, including Courts-martial. It does not apply to affidavits presented to any Court or officer, nor to proceedings before an arbitrator. So the rules are strict in court, but not binding in the same way before an arbitrator.

The Adhiniyam defines the building blocks. Evidence means oral evidence (statements, including electronic statements, which the Court permits or requires witnesses to make about facts under inquiry) and documentary evidence (all documents, including electronic or digital records, produced for the Court's inspection). A document is any matter recorded on any substance by letters, figures, marks or other means, and it expressly includes electronic and digital records. Emails, server logs, messages, websites, locational data and voice mail on digital devices are listed as documents.

A fact is anything perceivable by the senses, or any mental condition of which a person is conscious. Facts in issue are facts from which the existence, non-existence, nature or extent of a right, liability or disability asserted or denied in a proceeding necessarily follows. A fact is relevant when it is connected with another fact in the ways the Adhiniyam lays down.

For a forensic auditor this means three things. Collect material that can be shown to be a document or a witness statement. Keep originals and a clean chain of custody. Be ready to explain how each item connects to a fact in issue, such as a diversion of funds or a forged invoice.

Key rules to remember

Scope of the Adhiniyam (Section 1): Applies to: all judicial proceedings in or before any Court, including Courts-martial. Does not apply to: affidavits; proceedings before an arbitrator.; In force from 1 July 2024. Remember the two exclusions.
Evidence (Section 2(1)(e)): Evidence = oral evidence (statements, including electronic) + documentary evidence (documents, including electronic or digital records, produced for inspection of the Court); Two kinds only. A forensic report is not itself a third kind; its supporting records and the auditor's testimony are.
Document (Section 2(1)(d)): Document = any matter recorded on any substance by letters, figures, marks or other means, intended to be or capable of being used to record that matter; includes electronic and digital records; Emails, server logs, messages, websites, location data and voice mail are named in the illustration.
Proved, disproved, not proved (Section 2(1)): Proved: Court believes it exists, or considers it so probable that a prudent man would act on it. Disproved: the opposite. Not proved: neither proved nor disproved.; The test is a prudent man acting on the supposition, not absolute certainty.
May presume and shall presume: May presume: regard as proved unless and until disproved, or call for proof. Shall presume: regard as proved unless and until disproved.; Conclusive proof is stronger: the Court shall not allow evidence to disprove it.
Terms reduced to a document (Section 94): Where terms of a contract, grant or disposition of property are in a document, give no evidence of the terms except the document itself or admissible secondary evidence.; A statement in the document of some other fact does not bar oral evidence of that fact (Explanation 3).
Secondary evidence (Section 60): Allowed when the original is: with the opposite party or a person beyond the Court's process or legally bound to produce it, and does not produce it after notice; admitted in writing; lost or destroyed; not easily movable; a public document; a document of which a certified copy is permitted; or numerous accounts, to prove the general result.; For some clauses any secondary evidence is admissible; for public documents and certified-copy cases only a certified copy is.
Electronic records (Section 61): Admissibility cannot be denied only because a record is electronic or digital; subject to Section 63, it has the same legal effect, validity and enforceability as other documents.; Section 63 sets the further conditions; study it with Digital Evidence.
Production of documents (Section 165): A witness summoned to produce a document in his possession or power must bring it to Court despite any objection; the Court decides the objection.; The Court may inspect it unless it relates to matters of State. Communications between Ministers and the President of India cannot be required.

How to solve Forensic Audit and the Bharatiya Sakshya Adhiniyam, 2023 questions

Use this method for any question that asks how forensic audit findings can be used as evidence under the Adhiniyam.

1Identify the forum. Check if it is a Court or an arbitrator or an affidavit, since the Adhiniyam does not apply to the last two.
2Identify the facts in issue, such as the diversion of funds or a forged document, and what each audit finding is meant to prove.
3Classify each item as oral evidence (statements, including electronic) or documentary evidence (documents, including electronic or digital records).
4If a document's terms matter, apply Section 94: is the document itself produced? If not, ask whether Section 60 allows secondary evidence.
5For electronic records, apply Section 61 and note that Section 63 conditions must also be met.
6Check special requirements, such as attestation (Section 67) or production by a summoned witness (Section 165).
7State the standard: is the fact proved, disproved or not proved under the prudent man test?
8Conclude with practical advice: preserve originals, keep notice records and prepare the auditor to testify.

Quickest way: Forum, Fact, Form, Fit

When to use it: Use in a short-answer or case question when time is tight.

Forum: does the Adhiniyam apply (Court yes; arbitrator and affidavit no)?
Fact: name the fact in issue the finding supports.
Form: oral or documentary (including electronic)?
Fit: original or permitted secondary evidence under Sections 94 and 60, and Section 61 for digital records. Then write the conclusion in one line.

Common mistakes in Forensic Audit and the Bharatiya Sakshya Adhiniyam, 2023

Saying the Adhiniyam applies to arbitration proceedings.
Students assume all legal proceedings follow evidence law.
Fix: Quote Section 1(2): it does not apply to affidavits or proceedings before an arbitrator.
Treating the forensic audit report as a separate kind of evidence.
The report feels like the main product of the audit.
Fix: The Adhiniyam recognises only oral and documentary evidence. Show the report's supporting records as documents and the auditor's statement as oral evidence.
Rejecting an email or log because it is not a paper document.
Old habits from earlier law and everyday meaning of document.
Fix: Cite Section 2(1)(d) and Section 61: electronic and digital records are documents and cannot be denied admissibility merely for being electronic, subject to Section 63.
Allowing a photocopy or summary freely as proof of a contract's terms.
Students forget the primary rule in Section 94.
Fix: State the rule first, then the Section 60 situations where secondary evidence is allowed, such as original lost or held by the other side after notice.
Mixing up 'may presume' and 'shall presume'.
The wording looks alike.
Fix: May presume: the Court can regard it as proved or call for proof. Shall presume: it must regard it as proved until disproved. Conclusive proof allows no disproof.
Writing the Section 63 conditions from memory without the text.
Section 61 refers to Section 63, so students try to fill it in.
Fix: Only state that Section 61 is subject to Section 63 unless you are certain of the conditions.

Worked examples

Example 1

A forensic auditor finds that the accounts head of Sharma Traders Pvt Ltd sent emails approving fake vendor payments. The company files a complaint in a criminal court. The accused argues emails are not documents. Advise on admissibility.

Show the solution

Forum: a criminal court is a Court, so the Adhiniyam applies.
Fact in issue: whether the accounts head approved fake payments.
Form: emails are documentary evidence. Section 2(1)(d), with its illustration, includes electronic records such as emails and messages in the meaning of document.
Section 61: admissibility cannot be denied merely because the record is electronic; it has the same legal effect as other documents, subject to Section 63.
Practical step: preserve the original data with its metadata, and be ready to meet Section 63 conditions and to have the auditor testify as to how it was collected.

Answer: The objection fails. Emails are documents under Section 2(1)(d) and are not inadmissible only for being electronic under Section 61, subject to compliance with Section 63.

Example 2

In a dispute, the company must prove the terms of a written supply contract with Mehta Industries. The original is with Mehta Industries, which ignores a notice to produce it. The forensic auditor holds a photocopy. Can the photocopy be used?

Show the solution

Rule: Section 94 requires the document itself, or admissible secondary evidence, to prove the terms of a contract in document form.
Exception: Section 60(a) allows secondary evidence when the original is in the possession of the person against whom it is sought to be proved and, after notice under Section 64, that person does not produce it.
Facts: the original is with Mehta Industries, the opposite party, and a notice was served and ignored.
Explanation to Section 60: for clause (a), any secondary evidence of contents is admissible, so a photocopy qualifies.
Conclusion and practice: keep proof of the notice and of its service, since the condition depends on it.

Answer: Yes. The photocopy is admissible as secondary evidence under Section 60(a) because the opposite party failed to produce the original after notice.

Exam tips

Begin answers with the scope in Section 1 and a one-line link between forensic audit and evidence law. It sets up the rest.
Use the exact definitions of evidence, document, fact and proved. Short quotations of key words earn marks.
In case questions follow provision, analysis, conclusion. Name the section, apply the facts, then state the result.
Add a practical drafting or compliance point, such as preserving originals, serving notice or documenting chain of custody.
Cite a section number only when sure. If unsure, state the rule in words.

Practice questions from Forensic Audit and Indian Evidence Law

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Forensic Audit and the Bharatiya Sakshya Adhiniyam, 2023: frequently asked questions

Does the Bharatiya Sakshya Adhiniyam, 2023 apply to a forensic audit itself?

It applies to judicial proceedings in Courts, not to the audit work as such. It decides whether the material your audit gathers is accepted when used in court. Design the audit so that findings can meet its rules.

Are electronic records documents under the Adhiniyam?

Yes. Section 2(1)(d) says document includes electronic and digital records. Section 61 adds that a record cannot be denied admissibility merely because it is electronic, subject to Section 63.

When did the Adhiniyam come into force?

It came into force on 1 July 2024 by notification of the Central Government. It applies to proceedings in or before Courts, including Courts-martial.

Does the Adhiniyam apply before an arbitrator?

No. Section 1(2) excludes proceedings before an arbitrator and also affidavits. The definition of Court also excludes arbitrators.