Maintaining Digital Records Under the Information Technology Act
Section 4 of the Information Technology Act does not require anyone to stop maintaining physical records. It only refers to maintaining a scanned or digital, untamperable copy of the original physical record as evidence in court. So, if you want to maintain digital records, you need approval in writing from the concerned authorities (in this case, the chief inspector or commissioner).
You can, however, have a software-based record and keep monthly printouts for inspection. This practice is generally accepted by labor authorities, though nothing to that effect has been given in writing anywhere.