E commerce and online contracting

In today’s scenario with increase in advancement of technology, there is a rapid expansion of e commerce trading and exchange of electronic transactions at the convenience of both buyer and seller. E commerce is basically carrying out online transactions between buyer and seller with transfer of data for carrying out buying and selling of goods and services. The concept of e commerce has become a blessing for our society due to its convenience for both the parties involved in the transaction.

E commerce and online contracting

A legal status is given to a contractual agreement between two or more competent parties by any means of communication through “The Indian Contract Act, 1872”.

Certain provisions are made in “Information and technology act, 2000” regarding legalisation and validity of online contracts but no specific legislation has been passed for online contracts in India. As no specific legislation has been passed for online contract, it cannot be challenged on the basis of technicalities.

Different modes of communication are involved in an online contract like – internet, email, telephone etc. Online contract is different from traditional contract as in websites, a website acts as a retailer and gives response as per customer’s actions. Then, customer needs to agree with certain terms and conditions specified by the retailer by clicking a button and after that, it is the duty of website to provide the goods and services to the customer and the payment is made by the customer by any means. As a result, there are issues related to dealing with “offer and acceptance” of the online contract which is an essential element of a contract.

The Information technology act, 2000 deals with various provisions of online contracting and regulation of all kinds of online transactions which further deals with transfer of data between parties, protection of data and authentication of documents via digital signature.

Although, recognition is given to online contracting under “The Information of technology act, 2000” but still , there are apprehensions regarding dealing with online transactions in terms with its security, as there is no concrete precedents regarding enforceability of online contracts.

Wide spread initiatives has been taken in our country, like “digital India” for increasing the digital literacy in India. It also helped in increasing the digital connectivity by introducing Internet connection in various rural area for the development of digital infrastructure of our country. Hence, empowering field of technology in India.

On one hand, initiatives like “digital India” are taken place and on the other hand, no specific legislation has been passed for e contracting.

E commerce and online contracting

With the wide spread expansion of technological development, online contracting has become a very crucial part of the life of an individual now a days. From shopping to cab booking, almost everything deals with online contracting which helps in making life more easy and convenient for individuals. Electronic contracts are more cost effective than traditional paper based contracts and there are less chances of errors due to automation process. It provides a seller a wide reach to expand his business without thinking about distance.

In the case of “Hotmail corporation v. Van $ money pie increasing. , et al”, the Supreme court of New Jersey held that after clicking the “ I Agree” button in dialogue box, the plaintiff enters into valid contract and can be liable for terms and conditions given in the contract. Hence, this contract is enforceable in US.

As in the case of “Bhagwandas Goverdas kedia v. Girdharilal Parshottamdas”, it was held that acceptance of offer and intimidation of acceptance makes a contract, intimidation should be by some external factor which is regarded by law. Therefore, due to absence of definite legislation related to e contracts cannot be challenged because e contracts are as valid as a traditional paper contract.

In “Indian Evidence Act” electronic contract has been given recognition as an evidence in the court of law.

The Indian contract Act,1872 ,Information technology act,2000, the consumer protection Act, 1986 and Indian copyright Act, 1957 help in resolving issues related to validation of e contract.

People feel insecure to do online transactions mainly because terms and conditions are not transparent and nature of law is vague.

Remedies for breach of contract are as follows:

  1. A valid contract gives rise to rights and obligation to the parties. A contract is enforceable by law as per “Indian contract Act, 1872” in the court of law when a right is infringed in two forms that is damages and quantum merit.
  2. Other remedies are specified in “Specific Relief Act” in the form of injunction and specific performance. Due to increase in usage of internet and online transactions. It is necessary to pass definite legislation dealing with issues related to e contracting.