Internet is considered to be worlds all time greatest invention of human being in which every strata of society from all over the world has more or less participation in its inception and continuous development. No doubt it has provided enormous benefits in carrying out research & development, increased the pace of communication and reduced the barriers of flow of information between users all over the world.

 The Internet can be an effective alternative for data collection and surveys. It has major advantages over the "classical" method of using paper and traditional ("snail") mail. Internet survey is proven to be a very efficient method, which has the ability to suit the changing environment. Hence, it seems that it will eventually replace the traditional way. It will develop as an applicable and valid method in all areas including large scaled Census, business and household surveys etc. The paper highlights both positive and negative outcomes experienced in a number of e-research projects, focusing on several common mistakes and difficulties experienced in collection of data for research purpose

 This paper will address a cadre of technical, privacy, security and statistical issues involved in collection of data on Internet. This paper will also review the Federal Board of Revenue experience in web-based filling of income tax returns.