Issues Relating to eSignatures in an eContract: A Techno-legal Study

This blog is inscribed by Rimsha Bhardwaj.

 E-signatures and its applicability

E-signatures are the signatures that are digitally formed. The Information Technology (Amendment) Act, 2008 has changed the name of digital signature to e-signature. A digital signature is the technology specific and is irreversibly unique to both the document and the signer.[1] These signs can be either a typed name or can be a digitized image of the hand written signature. The Supreme Court has held that, “Once the contract is concluded orally or in writing, the mere fact that a formal contract has to be prepared and initialed by the parties would not affect either the acceptance of the contract so entered into or implementation thereof, even if the formal contract has never been initialed.”

Section 10 of the Information Technology Act, 2000 gives power to the central government to lay down the rules in respect of digital signatures.“Where any lay provides that information or any other matter shall be authenticated by affixing the signature or any document shall be signed or bear the signature of any person, then, notwithstanding anything contained in such law, such requirement shall be deemed to have been satisfied if such information or matter is authenticated by means of digital signature affixed in such manner as may be prescribed by the Central Government.[2]”In 1996 the United Nations published the UNCITRAL Model Law on Electronic Commerce. Article 7 of the UNCITRAL Model “Law on Electronic Commerce was highly influential in the development of electronic signature laws around the world, including in the US.  In 2001, UNCITRAL concluded work on a dedicated text, the UNCITRAL Model Law on Electronic Signatures, which has been adopted in some 30 jurisdictions. The latest UNCITRAL text dealing with electronic signatures is article 9, paragraph 3 of the United Nations Convention on the Use of Electronic Communications in International Contracts, 2005, which establishes a mechanism for functional equivalence between electronic and handwritten signatures at the international level as well as for the cross-border recognition.”

Issues in E-Signatures/ Digital Signatures

·      Authenticity

While forming an e-contract and doing e-signatures the main question arises of the authenticity of the person providing the signature. There is always an option given which states that ‘by clicking the button below I understand and agree that this is a legal representation of my signature’. Anyone can click on this option and the person can agree to the terms and conditions. The authenticity is the real problem. The person making the signatures can be fake as well. It is on the person who is asking for the signature should be careful and check all the things before signing the contract.

·      Technical Glitches while Signing a e-contract

There are many technical errors that incur while signing an e-contract. The e contracts need a proper internet connection. Due to some errors in the working of the internet connection while signing the contract there may be problem and the contract may not be signed. This might lead to further problems from one side of the party if the parties do not have mutual understanding. Thus it is also very important in a relationship to have a good understanding for prosperous and productive functioning. There can be problems due to the timings of both the parties. These kind of glitches make a problem for the people to trust on e-contracts, thus to gain more trust of people on such contracts proper measures need to be taken by the authorities responsible for it.

·      Preserving the integrity of the signed document

“Digitally born documents are increasingly being signed by the digital signatures. Once becoming records, they need to be preserved – in some cases for several years while in other cases permanently. In essence, what should be preserved besides the digital records themselves is their trustworthiness. This may be a problem because digital records might be converted to new formats, migrated to new media, emulated or virtualized in new environments due to the technological obsolescence. Authenticity, in particular, relies on the possibility to check the validity of digital signature. However, digital signatures expire after certain period. The author investigates the possibilities of long- term preservation of digitally signed records in the ever-changing IT environment.”

·      Knowledge to the person signing

Validating a digital signature is only possible as long as the original bit stream remains perfectly intact. Achieving this, even for relatively short periods of time, is not as straightforward as it sounds. There is misrepresentation to facts in these kinds of contracts as well; the parties may not give out the important facts at the time when facts are to be stated. Both the parties are duty bound to preserve the integrity of the signed documents and the information that has to be delivered out to each other. The parties should have the knowledge about the material facts and information that is necessary.

·      Are legal requirements of a valid contract fulfilled?

As discussed above there are certain legal requirements that are to be fulfilled while signing an e-contract. Thus it is necessary to check if these all requirements are fulfilled by both the parties. If one party says while signing a contract that they have to agree to a condition by saying I agree and other things as well. A party might not know if the things are done the same way or not because there might not be the physical appearance of the goods that are to be taken or the services rendered. 

Conclusion

Today with recent advancement in the areas of Internet and Information technology, living standards of people have changed in an unimaginable way because of which communication these days is no more restricted due to geographical and time constraints. Information is being transmitted and received widely and rapidly than ever before. And this is where electronic commerce offers the flexibility to business environment in terms of place, time, space, distance as well as payment. With growth of e-commerce, there is a rapid advancement in use of e-contracts. This can be stated that the e-signatures in this era are a very unique technique to solve the problems arising for the people who have to sign the pacts or work digitally. But due to lack of facilities in coping up with various hacks and other issues, there are problems arising in digital signatures as well. The concerned authority and organizations are making sure that the various steps are taken to make this field of contracts a better place to deal in. There have been various amendments made to the Information Technology Act to solve some of these errors.

Suggestions 

  1. Imparting of technical knowledge to the government staff and creating awareness, among the general public is an argent need to make digital India a success, through which Government is planning to be proved various services through online.
  2. If India has to become a stronghold in e-commerce, mere advancements in the information technology sector and increased awareness of the public as to electronic transactions itself will not suffice. Unless law keeps pace hand in hand with advancements and awareness progressive development cannot be achieved in the years to come. A lasting and effective IT regulation can take place only by international consensus and harmonization. Results of the study suggest an exclusive law to be enacted for the protection of online consumers.
  3. E-records are very easy to be tempered, hence, it is very crucial to authenticate the data to ensure justice. E-evidence should not be made admissible without corroboration unless genuine reasons are there to admit without corroboration.
  4. “There is a need to train law officers and judges to comprehend the admissibility of e-signatures and equip them to look into the admissibility of e-signatures on case by case basis as the electronic evidence.[3] More importantly, judiciary must be able to take into account the ease with which electronic records can be used by both sides and make the best use of the e-records itself to meet the ends of justice.”
  5. “India has very less number of forensic labs to investigate, examine or recover the electronic data. Hence, it takes more time to identify, extract, document and interpret computer data. Hence, the need is to establish more forensic labs and also to create a human force having knowledge to recover and investigate digital evidence. There is a need to introduce accountability online in relation to the transactions on the internet.”

References


[1] https://www.indialawoffices.com/legal-articles/e-contracts-and-validity-india, (last visited 26th march 2020).

[2] Info. Tech. Act, s. 5.

[3] “International Journal of Pure and Applied Mathematics,Volume 120 No. 5 2018, 4601-4618 LEGAL ISSUES ARISING IN E- CONTRACTS IN INDIA: AN ANALYSIS 1S.R.SUBAASHINI”

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