LEGAL RECOGNITION OF ELECTRONIC RECORDS

INTRODUCTION

In electronic commerce, digital records are a general term that is used to describe any goods
that are stored, delivered and used in its electronic format. Examples of digital records
include e-books, music files, software, digital images, Web site templates, manuals in
electronic format, and any item which can be electronically stored in a file or multiple files.
Digital records may also be called electronic records or e-goods. [1]

The object of The Information Technology Act, 2000 as defined therein is as under: –

“to provide legal recognition for transactions carried out by means of electronic data
interchange and other means of electronic communication, commonly referred to as
“electronic methods of communication and storage of information, to facilitate electronic
filing of documents with the Government agencies and further to amend the Indian Penal
Code, the Indian Evidence Act, 1872, the Banker’s Book Evidence Act, 1891 and the Reserve
Bank of India Act, 1934 and for matters connected therewith or incidental thereto.”

LEGAL RECOGNITION OF ELECTRONIC RECORDS

Recognition of electronic records:

The Information Technology Act, 2000 also aims to provide the legal framework under
which legal sanctity is accorded to all electronic records and other activities carried out by
electronic Information Systems Control and Audit means. The Act states that unless
otherwise agreed, an acceptance of contract may be expressed by electronic means of
communication and the same shall have legal validity and enforceability.

Digital Signature (Amended Vide ITAA 2008):

Section 3 gives legal recognition to electronic records and digital signatures. The digital
signature is created in two distinct steps. First the electronic record is converted into a
message digest by using a mathematical function known as “hash function” which digitally
freezes the electronic record thus ensuring the integrity of the content of the intended
communication contained in the electronic record. Any tampering with the contents of the
electronic record will immediately invalidate the digital signature. Secondly, the identity of
the person affixing the digital signature is authenticated through the use of a private key
which attaches itself to the message digest and which can be verified by anybody who has the
public key corresponding to such private key. This will enable anybody to verify whether the
electronic record is retained intact or has been tampered with since it was so fixed with the
digital signature. It will also enable a person who has a public key to identify the originator of
the message.

Electronic Signature:

Electronic signature has also been dealt with under Section 3A of the IT Act, 2000[10]. A
subscriber can authenticate any electronic record by such electronic signature or electronic
authentication technique which is considered reliable and may be specified in the Second
Schedule. An Amendment to the IT Act in 2008[11]introduced the term electronic signatures.
The implication of this Amendment is that it has helped to broaden the scope of the IT Act to
include new techniques as and when technology becomes available for signing electronic
records apart from Digital Signatures.

Electronic Governance:

E-governance or Electronic Governance is dealt with under Sections 4 to 10A of the IT Act,
2000. It provides for legal recognition of electronic records and signature and also provides
for legal recognition of contracts formed through electronic means. Filing of any form,
application or other documents, creation, retention or preservation of records, issue or grant
of any license or permit or receipt or payment in Government offices and its agencies may be
done through the means of electronic form.

Various sections under the Information Technology Act 2000 deals with the recognition of
electronic records. Section 4 of the Indian IT Act, 2000 confers legal recognition to electronic
records. Paper based documents are equated with electronic records so long as they are made
available in electronic form and are accessible so as to be usable for a subsequent reference.
It provides that where any law requires that any information or matter should be in the
typewritten or printed form then such requirement shall be deemed to be satisfied if it is in an
electronic form.

Section 5 confers legal recognition to digital signatures and equates it with handwritten
signatures. Where any law requires that any information or matter should be authenticated by
affixing the signature of any person, then such requirement shall be satisfied if it is
authenticated by means of Digital Signatures affixed in such manner as may be prescribed by
the Central Government.

Section 6 lays down the foundation of Electronic Governance. It provides that the filing of
any form, application or other documents, creation, retention or preservation of records, issue
or grant of any license or permit or receipt or payment in Government offices and its agencies
may be done through the means of electronic form[12]. Section 6A talks about the service
provider as the appropriate government may authorize any service provider and vary charges
as they think fit. Section 6 aims to eliminate red tapism and promote use of electronic records
and digital signatures in Government and its agencies

Section 7 provides that the documents, records or information which is to be retained for any
specified period shall be deemed to have been retained if the same is retained in the electronic
form provided the information therein remains accessible and represents the original
information.

Section 8 provides for the publication of rules, regulations and notifications in the Electronic
Gazette. It provides that where any law requires the publication of any rule, regulation, order,
bye-law, notification or any other matter in the Official Gazette, then such requirement shall
be deemed to be satisfied if the same is published in an electronic form. It also provides
where the Official Gazette is published both in the printed as well as in the electronic form,
the date of publication shall be the date of publication of the Official Gazette which was first
published in any form.

However, section 9 of the Act provides that the conditions stipulated in sections 6, 7 and 8
shall not confer any right to insist that the document should be accepted in an electronic form
by any Ministry or department of the Central Government or the State Government.

Under section 10 of the act, the Central Government has been conferred with the power to
make rules in respect of Digital Signature, interalia, the type, manner, format in which digital
signature is to be affixed and procedure of the way in which the digital signature is to be
processed.
The Central Government may, for the purposes of this Act, by rules, prescribe-

 the type of digital signature.

 the manner and format in which the digital signature shall be affixed.
 the manner or procedure which facilitates identification of the person affixing the
digital signature.
 control processes and procedures to ensure adequate integrity, security and
confidentiality of electronic records or payments, and
 any other matter which is necessary to give legal effect to digital signatures.[6]

Attribution

The Act deals with attribution, receipt and dispatch of electronic records. ‘Attribution’ means
‘to consider it to be written or made by someone’. Hence, section 11 lays down how an
electronic record is to be attributed to the person who originated it. Section 11 of IT Act,
2000 as amended provides that an electronic record shall be attributed to the originator if it
was sent by the originator himself; or by a person who had the authority to Act on behalf of
the originator in respect of that electronic record; or by an information system programmed
by or on behalf of the originator to operate automatically.
Acknowledgement and Dispatch of Electronic Records:
Section 12 of IT Act, 2000 as amended provides that where the originator has not stipulated
that the acknowledgment of receipt of electronic record be given in a particular form or by a
particular method, an acknowledgment may be given by any communication by the
addressee, automated or otherwise; or any conduct of the addressee, sufficient to indicate to
the originator that the electronic record has been received. Where the originator has stipulated
that the electronic record shall be binding only on receipt of an acknowledgment of such
electronic record by him, then unless acknowledgment has been so received, the electronic
record shall be deemed to have been never sent by the originator. Where the originator has
not stipulated that the electronic record shall be binding only on receipt of such
acknowledgment, and the acknowledgment has not been received by the originator within the
time specified or agreed or, within a reasonable time, then the originator may give notice to
the addressee stating that no acknowledgment has been received by him and specifying a
reasonable time by which the acknowledgment must be received by him and if no
acknowledgment is received within the aforesaid time limit he may after giving notice to the
addressee, treat the Electronic record as though it has never been sent.
Time and place of dispatch and receipt of Electronic record

Section 13 of IT Act, 2000 as amended provides that unless otherwise agreed between the
originator and the addressee, the dispatch of an Electronic record occurs when it enters a
computer resource outside the control of the originator & the time of receipt of an Electronic
record shall be at the time when the Electronic, record enters the designated computer
resource (for the cases where the addressee has designated a computer resource for the
purpose of receiving Electronic records) and at the time when the Electronic record is
retrieved by the addressee (For the cases where the Electronic record is sent to a computer
resource of the addressee that is not the designated computer resource). If the addressee has
not designated a computer resource along with specified timings, if any, receipt occurs when
the Electronic record enters the computer resource of the addressee. Save as otherwise agreed
to between the originator and the addressee, an Electronic record is deemed to be dispatched
at the place where the originator has his place of business, and is deemed to be received at the
place where the addressee has his place of business. The provisions of sub-section (2) shall
apply notwithstanding that the place where the computer resource is located may be different
from the place where the Electronic record is deemed to have been received under sub-
section (3). In addition to this, if the originator or the addressee has more than one place of
business, the principal place of business, shall be the place of business and if the originator or
the addressee does not have a place of business, his usual place of residence shall be deemed
to be the place of business; and “usual place of residence”, in relation to a body corporate,
means the place where it is registered.

Secure Electronic Records and Secure Electronic Signatures:

Sections 14 to16 deals with securing electronic records and electronic signatures. Section 14
provides where any security procedure has been applied to an electronic record at a specific
point of time, then such record shall be deemed to be a secure electronic record from such
point of time to the time of verification. Section 15 provides for the security procedure to be
applied to Digital Signatures for being treated as a secure digital signature.[14]Section 16
provides for the power of the Central Government to prescribe the security procedure in
respect of secure electronic records and secure digital signatures. In doing so, the Central
Government shall take into account various factors like nature of the transaction, level of
sophistication of the technological capacity of the parties, availability and cost of alternative
procedures, volume of similar transactions entered into by other parties etc.