The baazee for Indian e-commerce

Avnish Bajaj CEO Baazee

The highly controversial Delhi MMS case has highlighted the lack of clarity in various sections that make up India’s Information Technology Act (IT Act). An obscene video clip was allegedly hosted on the Baazee auction site by an engineering student. The CEO of Baazee, Avnish Bajaj was held responsible and arrested by the Delhi Police under section 67 of the IT Act. The Act prohibits the transmission of obscene material through the electronic form. A variety of Indian IT associations such as FICCI, Nasscom and the Internet & Online Association have decried the arrest.

Most cyber lawyers argue that the police have ignored section 79 of the IT Act which has certain conditions under which the ‘network service provider’ (in this case Baazee.com) should not be held liable for third party information. Holding Bajaj liable for the clip would be similar to holding the municipal commissioner of a city responsible for the sale of pornographic CDs on street corners.

Vivek Kathpalia, associate, Nishith Desai Associates says “The police have perhaps gone too far and ignored certain parts of the IT Act. The intent on part of Baazee is clearly absent.” Section 79 of the Indian IT Act says that no person providing any service as a network service provider shall be liable under the Act, for any third party information or data made available if it can be proved that the offence or contravention was committed without the knowledge of the provider and the organisation exercised all due diligence to prevent it. This, however, can lead to confusion. “How can one prove the lack of knowledge other than merely saying so?” asks Pawan Duggal, a known cyber lawyer from Delhi. He is of the opinion that the IT Act needs to be changed and should be attuned to an e-commerce environment.

Another aspect in this case are the terms and conditions that apply to users of a website. A seller on an auction site clicks on the “I agree” button or link implying that he or she has agreed to the terms put forth by the site. Yet in the present case the police have not considered this as consent. The law only recognises digital signatures as proof of assent. Unfortunately, most websites do not use digital signatures for this purpose and the technology has failed to catch on except for the limited purpose of ensuring that a website belongs to the organisation it purports to represent.

While India’s criminal law holds the accused innocent till proven guilty, the IT Act is retrograde as it considers the accused guilty till proven innocent. This means that the onus of proving innocence lies upon the accused. This case can either help in closing the gaps in India’s IT Act or increase confusion. For example, do you need a physical signature to verify a deal or is the ‘I agree’ clause sufficient? Additionally, to what extent is the service provider responsible for content posted on the site? No matter what the final outcome, this case will lead to changes that govern transactions in the Indian e-commerce space.

Sushma Naik