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Evidentiary Value of E-Contracts

Written by: Kapil Raina - 4th Year Law Student, D. E. S. Law College, Pune
Constitutional Lawyers in India
Legal Service
  • It's an undisputed fact that E-Commerce has become a part of our daily life. One such justification for the popularization of E-Commerce would be immoderate technological advancement. E-Commerce, as the name suggests, is the practice of buying and selling goods and services through online consumer services on the internet. The ‘e' used before the word ‘commerce' is a shortened form of ‘electronic'. The effectiveness of E-Commerce is based on electronically made contracts known as E-Contracts. Although E-Contracts are legalized by Information Technology Act but still majority feels insecure while dealing online. The reason being lack of transparency in the terms & conditions attached to the contract and the jurisdiction in case of a dispute that may arise during the pendency of a transaction with an offshore site.

    What Are E-Contracts

    In the words of Sir William Anson, a contract is a legally binding agreement between two or more persons by which rights are acquired by one or more to acts or forbearance on the part of the other or others.

    E-Contract is an aid to drafting and negotiating successful contracts for consumer and business e-commerce and related services. It is designed to assist people in formulating and implementing commercial contracts policies within e-businesses. It contains model contracts for the sale of products and supply of digital products and services to both consumers and businesses.

    An e-contract is a contract modeled, executed and enacted by a software system. Computer programs are used to automate business processes that govern e-contracts. E-contracts can be mapped to inter-related programs, which have to be specified carefully to satisfy the contract requirements. These programs do not have the capabilities to handle complex relationships between parties to an e-contract.

    An electronic or digital contract is an agreement “drafted” and "signed" in an electronic form. An electronic agreement can be drafted in the similar manner in which a normal hard copy agreement is drafted. For example, an agreement is drafted on your computer and was sent to a business associate via e-mail. The business associate, in turn, e-mails it back to you with an electronic signature indicating acceptance. An e-contract can also be in the form of a "Click to Agree" contract, commonly used with downloaded software: The user clicks an "I Agree" button on a page containing the terms of the software license before the transaction can be completed. Since a traditional ink signature isn't possible on an electronic contract, people use several different ways to indicate their electronic signatures, like typing the signer's name into the signature area, pasting in a scanned version of the signer's signature or clicking an "I Accept" button and many more.

    E-Contracts can be categorized into two types i.e. web-wrap agreements and shrink-wrap agreements. A person witnesses these e-contracts everyday but is unaware of the legal intricacies connected to it. Web-wrap agreements are basically web based agreements which requires assent of the party by way of clicking the “I agree” or “I accept” button e.g. E-bay user agreement, Citibank terms and conditions, etc. Whereas Shrink-wrap agreements are those which are accepted by a user when a software is installed from a CD-ROM e.g. Nokia pc-suite software.

    Evidentiary Value Under Indian Evidence Act

    It is pertinent to contextualize at this juncture that evidence recorded or stored by availing the electronic gadgets is given the evidentiary status. For instance: the voice recorded with the help of a tape recorder. Now -a-days, the digital voice recorder, digital cameras, digital video cameras, video conferencing are adding a new dimension to the evidentiary regime. Justice Gururajan, the Karnataka High Court judge has held in a civil suit that video conferencing evidence is valid .The emergence of information and communication witnessed sea change by elevating the status of the evidence recorded, generated or stored electronically from the secondary to primary evidential status. The shift in the paradigm owes to the efforts of the working group of the UNCITRAL Model law on electronic commerce and assigning of the legal recognition to e-record or data message.

    The evidentiary value of e-contracts can be well understood in the light of the following sections of Indian Evidence Act. Sections 85A, 85B, 88A, 90A and 85C deals with the presumptions as to electronic records whereas Section 65B relates to the admissibility of electronic record.

    The above mentioned sections can be explained as follows:

    Section 85a:

    As regards presumption to electronic agreements, this section is incorporated. It says that every electronic record of the nature of an agreement is concluded as soon as a digital signature is affixed to the record. Section 85A has been added in order to ensure the validity of e-contracts. But there are some restrictions as regards the presumptive value. The presumption is only valid to electronic records, electronic records that are five years old and electronic messages that fall within the ambit of Section 85B, Section 88A and Section 90A of Indian Evidence Act.

    Section 85b:

    Section 85B provides that the court shall presume the fact that the record in question has not been put to any kind of alteration, in case contrary has not been proved. The secure status of the record may be demanded till a specific time. The digital signature should also be presumed to have been affixed with an intention of signing and approving the electronic record. Further it has been provided that the section should not be misread so as to create any presumption relating to the integrity or authenticity of the electronic record or digital signature in question.

    Section 88a:

    “The court may presume that an electronic message forwarded by the originator through an electronic mail server to the addressee to whom the message purports to be addressed corresponds with the message as fed into his computer for transmission, but the court shall not make any presumption as to the person by whom such message was sent”.

    This section is self-explanatory as it purports to follow the basic rules of a valid hard-copy agreement. The words “may presume” authorize the court to use its discretionary power as regards presumption. Sections 85A and 85B contained the words “shall presume” which expressly excluded this discretionary power of the court.

    Section 90a:

    In case of an electronic record being five years old, if proved to be in proper custody, the court may presume that the digital signature was affixed so as to authenticate the validity of that agreement. The digital signature can also be affixed by any person authorized to do so. For the purpose of this section, electronic records are said to be in proper custody if they are in the custody of the person with whom they naturally be. An exception can be effected in case circumstances of a particular case render its origin probable.

    Section 85c:

    As far as a digital signature certificate is concerned, the court shall presume that the information listed in the certificate is true and correct. Inclusion of the words “shall presume” again relates to the expressed exclusion of the discretionary power of the court.

    Section 65b:

    Section 65B talks about admissibility of electronic records. It says that any information contained in an electronic record which is printed on a paper or stored/recorded/copied on optical/magnetic media produced by a computer shall be deemed to be a document and is admissible as evidence in any proceeding without further proof of the original, in case the following conditions are satisfied:
    The computer output was produced during the period over which the computer was used regularly to store or process information by a person having lawful control over the use of the computer. In case a combination of computers, different computers or different combinations of computers are used over that period, all the computers used are deemed to be one single computer.

    The information contained should have been regularly fed into the computer, during that period, in the ordinary course of activities.
    The computer was operating properly during that period and if not, it would not have affected the accuracy of data entered.
    A certificate issued is also admissible if it contains a statement which:
    Identifies the electronic record containing the statement.
    Gives information about the particulars of the computer involved in the production of record.

    The certificate issued should be signed by a person officially responsible for the use of that device in relation to the relevant activity. The information fed into the computer should be in appropriate form as well as by appropriate device.

    To end with, it can be said that electronic contracts are almost same as other hard copy contracts as far as its evidentiary value is concerned and in case of any discrepancy there are certain prerequisites that fill the lacunae. All electronic contracts are valid contracts as they are legalized by the Information Technology Act and one could be made liable if there is any infringement with the terms and conditions. Subsequently many amendments have been made in order to attain conceptual clarity.

    Cyber and E-Commerce laws, P. M. Bakshi and R. K. Suri
    Contract law, MBL-1, DED, NLSIU
    Indian Evidence Act
    Indian Contract Act, Pollock and Mulla

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