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May 25, 2000


The Rediff Business Special/Dewang Mehta

'IT Bill will boost e-commerce and Net-usage, but will need balanced implementation'

Dewang Mehta, NASSCOM PresidentAll the prognosticators will tell you that the IT Bill will set the country on fire! Cynical as I am, I see no reason to believe they're wrong. However, we need to be careful where hype outspaces common sense.

According to my analysis of the IT Bill, it is a great piece of cyber-art. It will herald electronic commerce in India, help change outdated provisions of 19th century laws and, at the same time, provide provisions to deal with new and innovative cyber-crimes.

send this business special feature to a friend After all, one does require a law so that people can buy over the Net using credit cards without fear of misuse. One does require laws so that infamous episodes, like the one where actress Pooja Bhatt was a victim of manipulative pornography, are not repeated. Laws are required so that in cyberspace one can verify the authenticity of an e-mail or identify the person with whom you are conducting business on the Net.

However, there are some awkward clauses in the bill: like Clause 79, which allows unlimited power to the cops and may require some balancing act to stop misuse by citizens and police.

Overall, the Information Technology Minister Pramod Mahajan, the government and Parliament need to be congratulated for this piece of cyber-art. With the passing of IT Bill, India becomes the 12th nation to have cyber-laws.

IT Bill will boost Internet-usage in IndiaHowever, like any other law, even the IT Bill will be really tested, when it is implemented. While there's plenty in its provisions to give us all enormous cause for cheer, there are some parts that will require closer examination: at least, at the time of its implementation.

First of all, the IT Bill exemplifies a very significant point. It provides for the much-needed legal framework so that information is not denied legal effect, validity or enforceability, solely on the ground that it is in the form of electronic records.

In view of the growth in transactions and communications carried out through electronic mode, the bill seeks to empower government departments to accept filing, creating and retention of official documents in the digital format. Similarly, unless otherwise agreed, even a contract represented in the electronic form will be acceptable. Thus, for example, computerised print-outs of land records documents would now be admissible in court of law.

The IT Bill provides a peripheral framework for e-commerce regime, which comprises 93 sections divided into 13 chapters. It includes four schedules that lay down the relative amendments sought to be made to the Indian Penal Code, the Indian Evidence Act, 1872, the Banker's Evidence Act, 1891, and the Reserve Bank of India Act, 1934. The 13 chapters deal with preliminary matters, digital signature, electronic governance, attribution, acknowledgement and dispatch of electronic records, secure electronic records and secure digital signatures, regulation of certifying authorities, digital signature certificates, obligations of subscribers, penalties and adjudication, the cyber regulations appellate tribunal, offences, network service providers not to be liable in certain cases and miscellaneous provisions.

Thus, the bill with one stroke has also proposed e-savvy changes. For instance, now you can file a first information report, or FIR, at a police station through e-mail.

The bill has also proposed a legal framework for the authentication and origin of electronic records/communications through electric or digital signature. This would eliminate barriers resulting from uncertainties over writing and signature requirements and promote legal and business infrastructure necessary to implement e-commerce, spurring the use of the Internet, e-mail and e-commerce. In simple words, the introduction of digital signature means now the consumers can buy or sell over the Net through credit card, online payment, etc.

What does this mean in economic terms? A NASSCOM survey puts the total volume of e-commerce in India (1999-2000) at an estimated Rs 4.50 billion. Of this, about Rs 500 million was contributed by retail Internet or business-to-consumer, or B2C, transactions, and about Rs 4 billion by business-to-business, or B2B, dealings.

Examples of B2C include buying music or books on or manufacturers in Moradabad exporting brassware to international consumers. All these transactions would get a phenomenal push with the passage of the Act. Indians are already buying over the Net through credit cards. The bill will secure privacy for the consumer.

E-commerce worth Rs 4.50 billion may seem negligible at first glance. It is impressive, however, when viewed against the backdrop of a non-existent regulatory framework that supports e-commerce. Imagine the potential that would be unleashed once a catalysing framework is in place! It could exceed Rs 25 billion during 2000-01 and Rs 100 billion by 2002, as the NASSCOM survey reveals. Within five years, hardly any business in India will succeed without the application of e-commerce technologies. Therefore, quick passage of the bill was a necessity.

The bill would also curb computer crimes. Cyber laws laid down in it provide for penalties, punishment and compensation for hacking, unauthorised access to computer networks, databases, spread of computer viruses, disruption of services, copying of software, tampering with source documents and electronic forgery.

Meanwhile, amendments to Clause 73 of the IT Bill, recommended by the parliamentary committee, insisted on cyber cafes maintaining details on users and the sites visited by them -- non-compliance of which would lead to conviction, including imprisonment. These clauses were not acceptable to the government. It shows that the government is quick to see reason and willing to safeguard the interests of the citizens.

Yet, the bill does leave some questions unanswered and these relate to segments of the Net world such as chat rooms, bulletin boards, search engines, dating sites and what have you. At what point an innocent cyber voyage crosses over to the dark side, when does a search engine become 'indecent scrutiny', and just who is liable when 'objectional' material changes hands are still areas that need clarity. The receipt of 'obscene' messages by a person logging in at a cyber café, a person seeking friendship on a dedicated dating site, or a person logging into a pornographic site within the four walls of his home-could well attract punitive action under the new dispensation. In each of these cases, there is no lucid way of pinning blame on an individual, café owner, search engine or site. The fact remains that there are countless foreign sites and search engines that will lead Indian surfers into horizons where the angels fear to tread.

Can we touch these sites which by all accounts are seen to be 'breaking the law'? Hardly! Then why harass our own people who are doing no more than this?

Guidelines that state clearly just what constitutes a cyber crime are then an absolute must. The fear is that in the absence of such a blueprint, 'Net policing' might take on a more rabid, more uncharitable flavor. The cyber danda, or baton, if not wielded properly, could cause a major set back to our Internet forays. Instead of promoting and enhancing the use of the Net, we could be placing impediments in its unrestricted proliferation. The Internet has to spread like wild fire in India for us to realise our ambitious e-business dreams. A law that impedes the growth of the Internet will have a roll-over effect on all the other related segments of this burgeoning industry.

The IT Bill's silence on issues such as 'cyber-squatting' is also going to require a re-look. Cyber-squatting, simply put, is the stealing or assumption of a domain name by a dot-com, which is the same name as that of an established and reputed company in the brick and mortar world. Some individuals have tried and may even in future 'squat' on names such as the Tatas, Infosys, or Reliance, or Chandrababu Naidu, or anything else that spells a big banner. These squatters just do it before the companies wake up and register their domain names.

The IT Bill says nothing about how such cases can be handled and how the established players can seek redressal for such cyber-squatting. We are told that possibly the new Copyright Law will have these provisions.

However, for some experts, another sore point in the Bill is Clause 79 which gives unlimited powers to a police officer, not below the rank of a deputy superintendent, or an officer either belonging to or authorised by the central government. These persons have been allowed to enter any public place, search and arrest without warrant any person they suspect of having committed or of being about to commit any offence under the Act. Such a law is already part of the Indian Penal Code. The consolation is that the interests of citizens are somewhat safeguarded by vesting only a DSP and above with such powers. Legal experts believe that dropping the clause might be worse since even a sub-inspector can exercise this power. Therefore, more than the IT Bill, the other laws of the country need to be changed.

Thus, it is clear that it might really help to control cyber crime by intervening through technology rather than law. Techno-literate cyber cops, who will understand Internet crimes and protect people from becoming victims, are required.

In summary, the IT Bill is a step in the right direction and would herald e-commerce, e-governance and increase in usage of Internet. But, the Act does require balanced and careful implementation.

(Dewang Mehta is the president of National Association of Software and Services Companies, or NASSCOM.)


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