E Contracts in India
Section 10-A of the Information Technology Act, 2000 makes an Electronic Contract valid and enforceable. The quintessential requisite which entails further is that it must be in conformity with the provision of Indian Contract Act 1872.
Considering the aforesaid, the Courts in India are duly considering the electronic contracts under the provisions of Indian Evidence Act, 1872.
The provisions of the Information Technology Act, 2000 (IT Act) which gives legal recognition to an electronic contract (E -Contract) i.e. section 10-A reads as under:
“Section 10-A: Validity of contracts formed through electronic means. –
Where in a contract formation, the communication of proposals, the acceptance of proposals, the revocation of proposals and acceptances, as the case may be, are expressed in electronic form or by means of an electronic record, such contract shall not be deemed to be unenforceable solely on the ground that such electronic form or means was used for that purpose.”
Hon’ble Supreme Court in the case of Trimex International FZE Limited, Dubai vs. Vedanta Aluminium Limited, India, (2010) 3 SCC 1, observed that –
“It is clear that in the absence of signed agreement between the parties, it would be possible to infer from various documents duly approved and signed by the parties in the form of exchange of e-mails, letter, telex, telegrams and other means of tele-communication.”
Having said that, how can one enter into an E Contract? In light of the aforesaid provision and observation of the Hon’ble Supreme Court, a person can enter into E Contracts by way of an email, letter, telex, telegrams, etc. basically which are electronic forms and mediums.
In order to form a binding contract, even E Contract will have to pass through the mandates of Indian Contract Act, 1872. This law provides basics fundamentals for an agreement to be considered as a valid and binding contract such as a valid offer, unconditional & unqualified acceptance, lawful object, lawful consideration, free consent, consensus-ad-idem, etc.
Other relevant laws which are relevant are Registration Act, 1908; Indian Stamp Act 1899 wherein the registration of a Contract and payment of stamp duty is required and mandatory. This is duly considered by the Courts at the time of adjudication of the disputes under Contracts.