Monday, March 30, 2015

Online Petition And Survey By CCICI Regarding Cyber Law Due Diligence In India

Interpretation and analysis of the judgment of Supreme Court of India in Shreya Singhal v. Union of India (24th March 2015), Writ Petition (Criminal) No.167 Of 2012 (PDF) has already been started by various cyber law stakeholders of India. Most of them have based their observations upon Section 66A alone leaving aside other sections like Section 69A and Section 79 of the Information Technology Act, 2000.

However, it seems while doing justice to freedom of speech and expression in India, the Supreme Court has erred in reading down Section 79 and Rule 3 of Information Technology (Intermediaries Guidelines) Rules, 2011 (PDF) that pertains to Internet Intermediary liability and observance of cyber law due diligence (PDF) by them. In fact, it has been claimed that Supreme Court has killed cyber law due diligence in India to a great extent.  

Cyber Crimes Investigation Centre of India (CCICI), the premier cyber crime investigation centre of Perry4Law Organisation (P4LO), has been covering these issues from the very beginning. Now CCICI has taken this interpretation and effort to another level by starting an online petition and survey titled “Do We Need a Stronger Cyber Law Due Diligence in India?”

Unfortunately, most of the interpretations and observations regarding the judgment of Supreme Court were directed towards Section 66A alone and the issue of cyber law due diligence was totally ignored. This has serious ramifications for all cyber victims whose locus standi has been taken away by the Supreme Court to approach the Intermediary.

It is of utmost importance that this issue must be discussed in great detail and then taken up before the Supreme Court through a review petition. Similarly, the collective inputs can also be shared with Indian government and Parliament so that they can come up with a more potent and effective cyber law due diligence requirement in India.

If you are a cyber victim or you know a person who has been a cyber victim, please share your views through this petition and review. Your views would shape the cyber law of India and make it more meaningful. If you have ever suffered from harassment over e-mail, SMS, chatting, Social media, etc or you know a person who has been so harassed, then please share your views at the petition/survey page. Collectively let us make a responsible cyber society and culture in India.

Source: Cyber Law Blog.

Sunday, March 15, 2015

Digital India And Aadhaar Related Critical Policy Suggestions And Views Of Praveen Dalal

Digital India is a promising initiative of Indian Government. However, like any new and good project, Digital India is also suffering from many shortcomings and weaknesses. It is imperative on the part of Indian Government to remove these limitations of Digital India project instead of suppressing the same. It is also important that any critical view or suggestion regarding Digital India project must not be either suppressed or censored by Indian Government or technology platforms like Google, Twitter, etc.

There are many critical opinions regarding Aadhaar and Digital India projects. It is believed that by clubbing the digital India project with Aadhaar, Indian Government has made Digital India the digital panopticon of India.

There are also many reported cases of censorship activities of Google and Twitter in India. The dissenting tweets and posts regarding Digital India were censored by both Google and Twitter repeatedly. It would be better if these companies would respect civil liberties in cyberspace in the future.

This post is sharing the critical and other views and recommendations of Praveen Dalal regarding Digital India and Aadhaar Projects that have been shared at Twitter for public at large but are not easy to find due to censorship activities. These are as follows:

(3) Twitter Continues Censoring Digital India Related Dissenting Tweets. Source: Perry4Law News Centre,

(8) The Biggest Problem Of Digital India Project Is That It Lacks A Clear Cut Policy And Implementation Plan,

(11) Unconstitutional And Illegal Biometrics Collection Laws And Practices In India- Source: CEPHRC,

This consolidate list would provide a readymade reference list of all Digital India and Aadhaar related critical views and opinions of Praveen Dalal at a single place. We hope our readers would find this post and these tweets useful and productive.

Source: IIPS.

Monday, January 5, 2015

Cyber Security Issues For India In 2015

Cyberspace is becoming a complicated zone to handle and manage. Every country is trying its level best to adjust its affairs in cyberspace. However, cyber criminals and cyber attacks are much more ahead and advance than their prevention and remedies.

India is a late entrant in cyber security field as it never gave importance to cyber security related issues. In face, the research works titled cyber security developments 2013 (pdf) and 2014 of Perry4Law Organisation have shown many weaknesses in the cyber security infrastructure of India.

The matter does not end here. The cyber security trends in India in 2015 are also not very promising. The problem with Indian cyber security initiatives is that there is neither a legal framework nor any implementable policy for the cyber security. Even the national cyber security policy of India 2013 is suffering from numerous weaknesses.

According to the projections made by Centre of Excellence for Cyber Security Research and Development in India (CECSRDI), there are many complicated cyber security challenges that are waiting for India in the year 2015. Some of the areas of concern pointed out by CECSRDI are international legal aspects of cyber security, state sponsored cyber attacks, increasing use of malware, cyber espionage, cloud computing adoption in India, mobile security and mobile governance issues, critical infrastructure protection requirements in India, etc.

These issues must be analysed keeping in mind the technology driven projects like Digital India and Internet of Things (IoT) (pdf) that have been launched without any cyber crisis management plan of India and establishment of offensive and defensive cyber security capabilities.

The cyber security trends have also projected that malware like Stuxnet, Duqu, Flame, etc would be used more aggressively in the year 2015. These malware are not only stealth but they are also too sophisticated to be detected by India. Let us hope that Indian government would consider cyber security as a top priority area in the year 2015.

Sunday, September 14, 2014

IT Act To Be Amended To Accommodate E-Commerce Concerns

Information technology Act 2000 (IT Act 2000) carries provisions pertaining to e-governance and e-commerce. However, IT Act 2000 has outlives its importance and it is high time to enact dedicated laws for e-governance and e-commerce in India. This though of dedicated laws brings discomfort and uneasiness to the Indian government and hence it always chooses the easy path of bring piecemeal amendments in the existing laws. Of course, this is not a productive exercise in the long run and it brings unforeseen and unproductive results.

Now once again Indian government has decided to amend the IT Act 2000 to accommodate the e-commerce concerns. We have no dedicated e-commerce laws in India and barring few provisions in the IT Act, 2000, e-commerce in India is largely unregulated. As a result regulatory violation by Indian e-commerce websites is in abundance. In fact, e-commerce websites of India are under enforcement directorate scanner.

Indian government intends to streamline e-commerce laws in India by bringing a law in the form of Communications Convergence Bill. The government plans to modify the IT Act, 2000 to provide legal recognition for transactions carried out using electronic data interchange and other means of electronic communications in a more explicit manner. It also aims to draft a set of globally acceptable guidelines to increase the legal predictability for e-commerce and adopt the United Nations General Assembly's (UNGA) recommended Model Law on Electronic Commerce (MLFC).

This is a good policy decision by Indian government and it would bring uniformity and legal certainty among e-commerce entrepreneurs of India. 

Monday, July 21, 2014

Time To Scrap Aadhaar Project Has Come

Aadhaar initiative is one of the most draconian and unwanted initiative that has been forced upon Indian citizens by our respective governments. Whether it is Congress or BJP, both have been wasting public financial resources upon an illegal and unconstitutional project like Aadhaar.

What is really surprising is the fact that all this is happening despite the fact that the Supreme Court of India has declared that Aadhaar cannot be made compulsory by Indian government. However, government departments and authorities in India are openly flouting this direction of the apex court and are committing contempt of court.

There was a dire need for the Modi government to scrap the Aadhaar project. However, Modi government preferred to keep the project alive for reasons best known to it. Experts believe that although the Modi government has allocated a big sum for Aadhaar project yet it cannot legally spend the same upon Aadhaar project till legal and technical infirmities are removed first. Otherwise, it would be another round of booty sharing of hard earned public money.

Legality of Aadhaar project has already been questioned before many courts including the apex court of India. Till now the real intentions of Indian government has come to light. The fa├žade of public and welfare services is no more applicable to Aadhaar project as there is no element of welfare activities in the Aadhaar project. In fact, Indian government is hiding truth from Indian citizens in this regard and is all committed to violate our civil liberties.

There is no doubt that privacy is a basic human right that no government can take away. However, Indian government is not respecting this human right and is indulging in illegal and unaccountable e-surveillance and snooping. Instead of ensuring privacy rights in India, India is supporting countries like US for illegal e-surveillance upon Indian citizens.

Modi government must not fool Indians by portraying Aadhaar as a welfare project and must scrap the same till proper constitutional and legal safeguards are put in place. Indians must not enroll for Aadhaar no matter whatever arm twisting tactics are adopted by the Indian government in this regard.

Wednesday, June 11, 2014

International Cyber Security Cooperation

Cyber security is a complex mechanism that combines both technology and legal aspects. Further, cyber security also involves conflict of laws in cyberspace on the one hand and civil liberties protection in cyberspace on the other hand. The former is involved when the conflicting laws of two nations are involved that is usually the case these days. The latter comes into picture when the cyberspace policy of a nation is used to the detriment of the other as usually happens in the case of e-surveillance activities. Naturally international cooperation in the field of cyber security is need of the hour.

As far as India is concerned, the cyberspace landscape of India is fast changing. According to law firm Perry4Law, the cyber security breaches in India would raise complicated cyber security issues. The cyber security breaches need a mandatory reporting mechanism in India.

Similarly, with the active use of e-governance in India, cyber security of e-governance services in India must also be ensured. Indian cyberspace must be protected on a priority basis but this would create many techno legal cyber security challenges before the Narendra Modi government.

As cyber security breaches are increasing world over, both national and international stakeholders must deliberate upon this issue. The sooner this is done the better it would be for the cyberspace at large.

Monday, June 2, 2014

Indian Android Application Would Help Hearing And Speech Impaired People

India has not been very receptive to the plights and rights of disabled population. Whether it is educational institutions or public employments, disabled population in India is always at the disadvantageous position. Whatever little efforts that have come to rescue of these people they have come from private individuals with no profit motive. One such initiative has been undertaken by a team of four girls from the Vishwakarma Institute of Information Technology (VIIT) who have developed an android application to bridge the communication gap that exists between hearing and speech impaired people and normal beings. 

In an attempt to utilise their technical skills for a social cause, four students in their final year of engineering—Apeksha Bhat, Shubhangi Yerolkar, Nisha Advani and Sayali Bora—have developed this app that may prove handy. Their efforts need to be taken further on a large scale and in other directions as well.

The application in question converts the sign language into speech that will help a hearing and speech impaired person talk to people who do not understand sign language. Conversely, the hearing and speech impaired person can know what the other person speaks as the application also converts verbal language back into sign language. 

Talking about what differentiates their app from others in the market, Bhat says, “Designing an app in Hindi and only using the Indian Standard Sign Language was the most-difficult aspect of the whole development process. It is this feature that distinguishes our app from the others in the Android market and serve a similar purpose”.

For the project, the girls visited the Aadhar Deaf School located at Bibvewadi, Pune, where they researched to understand the special needs of the hearing impaired students. “Sitting in their classrooms, interacting with their faculty and the principal was an eye-opener for us. We were inspired to contribute in whatever small way we could to bridge the communication gap between them and us,” said Yerolkar. While encourage the initiative, Bilavari Karkare, principal, VIIT, Pune, has asked the college management to sponsor a smartphone with the app installed to the Aadhar Deaf School.

I hope Indian government would encourage these courageous and public spirited young girls in the larger interest of Indian population that needs special facilities.

Friday, May 9, 2014

Sanjam Garg Invents Cryptography Technology That Makes Computer Programme Code Unintelligible While Preserving Its Functionality

Encryption technology is being considered to be a good solution of many online evils. Encryption can protect individuals and companies from cyber threats, intellectual property thefts, corporate and cyber espionage and so on. Encryption can also help in protecting the intellectual property.

Protection of a software source code is considered to be a tedious job. The problem is that if we encrypt the source cod of software it may hinder its functionality and may render it useless. Sanjam Garg, a graduate of the Indian Institute of Technology, Delhi, has solved this problem and won the 2013 Doctoral Dissertation Award for developing a technique to protect such source codes.

He invented a breakthrough cryptography technology that enables the first secure solution to the problem of making computer programme code “unintelligible” while preserving its functionality. This problem, known as software obfuscation, conceals the programme's purpose or its logic in order to prevent tampering, deter reverse engineering, or pose a challenge to readers of the source code.

Garg described new mathematical tools that serve as key ingredients for transforming a program into a “jigsaw puzzle” of encrypted pieces. Corresponding to each input is a unique set of puzzle pieces that, when assembled; reveal the output of the programme. Security of the obfuscated programme hinges on the fact that illegitimate combinations of the puzzle pieces do not reveal anything.

Monday, March 31, 2014

New Company Law Of India And Cyber Obligations

Corporate law firm Perry4Law has provided a list of provisions of the Companies Act, 2013 and the rules 2014 under it. These rules and relevant provisions have been notified by Indian government from time to time. They have become operations from today i.e. 01-04-2014 hence Indian companies are required to make necessary compliances with them in due course of time.

The new company law has prescribed many techno legal compliance requirements that were not there in the old law. Thus, cyber law due diligence cannot be ignored by Indian companies anymore. Even cyber security requirements have been prescribed by the new company law. Very soon cyber security breaches notification would become mandatory in India and this would raise serious cyber security issues for Indian companies. Corporate frauds investigations are also going to increase due to increasing cyber crimes and cyber contravention among Indian companies.

The new company law regime prescribes management and inspection of documents in electronic form, electronic voting, electronic notices, etc that require a techno legal compliance on the part of Indian companies.  Corporate stakeholders would find these notifications by Indian government worth considering in this regard:

(2) MCA Notification Dated 26-03-2014 (PDF) Regarding 183 Sections of Indian Companies Act 2013

(19) Nidhi Rules, 2014 (PDF)

This list would be updated from time to time by Perry4Law. Please bookmark this page so that you can have updated information about Indian Companies Act, 2013 and Rules/Notifications made thereunder form time to time.

Wednesday, February 26, 2014

Telecom Environment In India Is Changing

Indian telecom environment is all set for a big overhaul after many scams and irregularities. On the one hand Indian government is encouraging electronic system design and manufacturing in India whereas on the other hand it is fine-tuning the telecom regulatory environment of India. The new merger and acquisition (M&A) guidelines issued by Indian government is seen as a pro active step by many telecom stakeholders.

The FDI policy for telecom sector of India 2014 (PDF) has also been made liberal by enhancing the limits of FDI in telecom sector of India. Indian government has also given approval to establish two semiconductor wafer fabrication manufacturing facilities in India (PDF).

At the same time regulatory compliances have also significantly increased in India in the telecom related fields. For instance telecom due diligence compliances is required to be ensured by foreign investors and those interested in M&A with Indian companies. Further, telecom stakeholders exploring the M&A route must also comply with the Internet intermediaries requirements and cyber law due diligence requirements (PDF) as prescribed by the Information Technology Act, 2000 (IT Act 2000).

The reaction of national and international telecom stakeholders are mixed in nature. Some have considered these steps as reformatory while others believe that these steps would not make much change in the existing circumstances and telecom environment. Only time would tell who is right in this regard.

Monday, February 3, 2014

M-Health Sector Of India Needs Regulatory Reforms

The healthcare sector of India is heading towards a big growth trajectory. Reports from many research organisations have shown that if India takes care of some health related aspects, then India can be greatly benefitted by this healthcare revolution. The corporate environment of India is also changing this is a good sign for healthcare industry of India.

Regulatory environment of India needs to be streamlined to make this revolution a reality. Presently, the m-health related legal violations in India are on rise as the m-health entrepreneurs in India are violating Indian laws while conducting their businesses.

Mobile handsets are increasingly being used to delivery numerous services in India. From mobile banking to online ticket reservations, everything can be managed from mobiles these days. The health sector is also utilised mobile technology to expand its services to areas that are not available through traditional medical science methods.

Mobile health or m-health is a contemporary concept in India. It has tremendous reach and it can reach even to the remotest areas of India where the traditional medical facilities cannot be provided.

However, along with increasing use of m-health in India its use must be suitably regulated by Indian government. Although we have no dedicated m-health laws in India yet m-health is presently regulated through legal provisions that can be found in different legislations.

According to New Delhi based ICT law firm Perry4Law, m-health legal requirements are not duly complied with by the m-health service providers of India. Legal compliances for privacy, data protection, data security, cyber security, cloud computing compliances, etc are still not adhered to by a dominant majority of m-health service providers in India, says Perry4Law.

This would make these m-health service providers liable to multiple legal proceedings and cases. M-health service providers are internet intermediary within the meaning of Intermediary guidelines as prescribed by Indian government.  They are also required to follow cyber law due diligence so that civil and criminal provisions under the information technology act 2000 cannot be invoked against them.

Judged by these legal standards, it is obvious that the m-health service providers in India and not complying with legal requirements at any stage and of any level. This would make them vulnerable to a host of legal actions when Indian government would become aware of these illegalities and irregularities.

Sunday, January 26, 2014

Indian Online Gaming Industry Is Maturing Says Perry4Law

Online gaming industry in India is fast maturing and it is moving towards a consolidation. Both regulatory environment and business mood is hinting towards a positive report about online gaming industry of India. As the online gaming business essentially involves use of information and communication technology (ICT), certain legal precautions are essential to be observed.

For instance, both e-commerce players and online gaming entrepreneurs must strictly follow cyber law due diligence in India (Pdf). Presently neither the e-commerce players nor the online gaming entrepreneurs are observing the cyber law due diligence requirements except a selective few one. Of course, we have entrepreneurs like Laxmicoin that has decided to wait for clear regulatory requirements rather than engaging in illegal online business. Even the corporate environment in India is fast changing.

Till now we have no dedicated online gaming and gambling laws in India. This has created an atmosphere of uncertainty and fear among the online gaming entrepreneurs in India. This is also the reason why very few players have entered into the online gaming arena of India.

For instance, legality of online poker in India is still a grey area. It is neither legal nor illegal. Just like Bitcoins exchanges operating in India, online poker websites operating in India can be either legal or illegal. It all depends how an online poker website is managed in India. If it is complying with all the applicable laws and regulations, it is legal to play online poker otherwise it is illegal.

Governments around the world are trying to regulate online gaming and gambling activities. Recently, the United Kingdom asked the Internet service providers (ISPs) to insert warning pages for unlicensed gambling websites. However, the ISPs refused to comply with this demand. Similarly, Singapore is planning to ban online gaming and enact laws in this regard. India is also planning an anti match fixing law that may cover online betting as well.

On the other hand, governments are also trying to liberalise the online gaming segment. The U.K. Gaming (Licensing and Advertising) Bill has passed the third reading in the House of Commons. Similarly, a good start for Internet and online gambling in New Jersey has already taken place and there are very good signs that online poker would be allowed in United States very soon.

Back in India the regulatory environment for online gaming is fast changing. Games like poker and rummy are finding support of both community and legal and judicial fraternity. According to Praveen Dalal, managing partner of New Delhi based IT law firm Perry4Law, the High Courts in India are protecting “Games of Skills” from the Criminal actions. Recently, the Bangalore High Court in Kirana S v. State of Karnataka Criminal Petition No. 76482013 (Pdf) held that playing Rummy is not a Criminal Offence as it involved “Application of Skills”, inform Dalal. In fact, another related matter is pending before the Supreme Court of India and the Judgment of Supreme Court would decide the fate of Online Gaming Industry of India, opines Dalal.

It seems this is a good time to start online gaming businesses in India However, before doing so it would be a prudent exercise to consult a good techno legal law firm regarding regulatory compliances as any deviance may create troubles for the entrepreneurs.

Thursday, January 23, 2014

Cyber Law Of India Must Be Scrapped Says Praveen Dalal

Law and technology are never on the same page. While law takes its own time to formulate and mature yet technology marches at a speed much beyond the law to catch and grasp. The same is happening in the case of Indian cyber law.

In the year 2000 a regulatory framework was introduced by Indian parliament to regulate transactions in the Indian cyberspace. India was new to this field and it considered the models suggested by foreign countries. That is well understandable as at that point of time India lacked the expertise in this regard.

However, what is frustrating is that even after 13 years of enactment of the information technology act, 2000, Indian parliament still lacks the techno legal expertise to enact a proper cyber law. According to media reports, the cyber law of India is in a bad condition. The Indian cyber law has started showing signs of decaying cyber law legislation rather than a maturing enactment. Even the techno legal experts have expressed their dissatisfaction with the present cyber law of India.

According to Praveen Dalal, managing partner of New Delhi based ICT law firm Perry4Law and leading techno legal expert of Asia, the Cyber Law of India should be repealed. According to Dalal, the present Cyber Law of India is suffering from many Irregularities and Unconstitutionalities. He believes that the Cyber Law of India must be scrapped and dedicated laws must be enacted for various fields like Cyber Law, Cyber Security, Cyber Forensics, E-Governance, etc.

These concerns are valid and genuine. The information technology act started as a piece of legislation for e-commerce and e-governance. Now it is transformed into an instrumentality of state oppression and e-surveillance. However, the real problem is how Indian parliament would enact these techno legal frameworks that required sound techno legal expertise that is presently missing.

Many provisions of the IT Act 2000 are violative of civil liberties protection in cyberspace. Some of the rules and regulations made under the IT Act, 2000 are already challenges before none other than the Supreme Court of India. It would be only prudent if Indian government scraps the IT Act, 2000 and come up with constitutionally valid legal framework.

Saturday, January 18, 2014

Experts Say That Implementation Is The Main Hurdle Before Indian Cyber Security

India has been trying to get its cyber security infrastructure proper and up to date. India has also formulated the cyber security policy, 2013 to assert its seriousness about cyber security. However, cyber security in India is still in a bad shape despite all these efforts of Indian government. So what is the problem that is plaguing Indian cyber security initiatives?

According to experts although the national cyber security policy of India has been declared yet it still to have to achieve a lot. The biggest hurdle before the Indian cyber security initiatives is the lack of implementation of various cyber security polices and strategies as formulated from time to time.

Take the example of the recent declaration of establishment of a cyber command force for armed forces of India. This is the second time such a declaration has been made by Indian government. Similarly, declaration about putting in place a cyber crisis management plan of India has been made from time to time. However, till now we have no implementable cyber attacks crisis management plan of India.

It seems the necessary will power to execute various cyber security initiatives of India is missing. Similarly, the offensive and defensive cyber security capabilities of India are also missing. Indian government must consider all these aspects and come up with implementable cyber security initiatives.

India Must Regulated The Unregulated E-Commerce Says Law Firm Perry4Law

Any business without regulation would create more troubles than solutions. The same is unfortunately happening in the case of e-commerce. Since e-commerce was a new filed in India, it was logical to give it some time to settle. However, the information technology act, 2000 was enacted more than a decade ago and this is sufficient time for allowing the e-commerce to function in India almost in an unregulated manner.

However, some heavy weight legal experts have thrown their weight against such unregulated e-commerce activities in India. According to Asia’s exclusive techno legal ICT law firm Perry4Law, India must suitably regulate e-commerce activities in India.

Fortunately, the Department of Industrial Policy and Promotion (DIPP), India released a Discussion Paper (Pdf) on e-commerce in India.  The paper has endorsed the views and suggestions provided by Perry4Law regarding regulation of e-commerce in India.

The paper has also endorsed the view of Perry4Law that legal requirements for undertaking e-commerce in India also involve compliance with other laws like Contract Law, Indian Penal Code, etc. Further, online shopping in India also involves compliance with the banking and financial norms applicable in India.

The paper also cautioned the online payment providers on the exact line as have been done by Perry4Law. It also gave the same example of Paypal as provided by Perry4Law and states that if PayPal has to allow online payments receipt and disbursements for its existing or proposed e-commerce activities, it has to take a license from Reserve Bank of India (RBI) in this regard. Further, cyber law due diligence (Pdf) for Paypal and other online payment transferors in India is also required to be observed.

Foreign e-commerce companies have been lobbying in India to make Indian e-commerce business regulation free. However, Indian government should not succumb to the pressure tactics and lobbying by these foreign companies.

It is high time for Indian government to take a strong stand against the arbitrariness and lawlessness by which the Indian e-commerce industry is suffering. The sooner this is done the better it would be for the larger interest of Indian consumers.

Saturday, January 4, 2014

Is Bitcoin Legal In India?

The Bitcoin saga of India has finally reached a stage where it is pertinent to answer a very crucial question. The question asks is Bitcoin legal in India? Bitcoins emerged as a preferential investment in India in the year 2013. However, the legality of Bitcoins in India was always in doubts.

This is more so when Perry4Law, the best techno legal firm in Asia, threw its weight against the open and unregulated use of Bitcoins in India. The cyber law trends of India 2013 by ICT law firm Perry4Law has cautioned (PDF) that Bitcoins websites may further face legal actions if they fail to comply with Indian laws in the year 2014.

To say the minimum Bitcoins are governed by many laws that are indirectly applicable to its dealings and transactions in India. For instance, the IT Act 2000 prescribes cyber law due diligence in India and the Internet intermediary liability in India. These cyber laws due diligence and Internet Intermediary requirements squarely apply to use of Bitcoins in India. Further, money laundering, foreign exchange and security dealing laws also apply to Bitcoins dealings and trading in India.

For too long regulatory authorities of India, including the Reserve Bank of India (RBI), remained moot spectators in the hope that Bitcoins would themselves provide a solution to their regulatory problems. However, this myth of RBI immediately became apparent the moment regulation of Bitcoins in India was demanded due to growing misuse of Bitcoins for illegal activities.

As the pressure mounted, the RBI cautioned users of virtual currencies against various risks including legal risks. Soon after the cautious advisory, the enforcement directorate (ED) swung into action and raided two Bitcoins websites and their offices. ED believes that Bitcoins money can be used for hawala transactions and funding terror operations and this seems to be a legally plausible explanation as well.

As on date the Bitcoins websites in India are under regulatory scanner and are vulnerable to all sorts of legal actions. In fact, Seven Digital Cash LLP is already facing legal risks for dealing in Bitcoins in India.

The Bitcoin entrepreneurs may feel that Bitcoins dealings in India are not illegal but this does not mean that they are legal as well. According to Perry4Law what it means is that till the position is cleared by clear cut regulations and norms, Bitcoin dealings would be regulated by existing laws and regulations. Thus, in their own interest, Bitcoin entrepreneurs must comply with existing laws. Otherwise they may be prosecuted by Indian authorities.

Tuesday, December 31, 2013

Cyber Trends By Perry4Law And PTLB

Perry4Law and Perry4Law’s Techno Legal Base (PTLB) have been providing trends in the fields of information and communication technology (ICT) for long. These include trends pertaining to cyber law, cyber security, cyber forensics, etc.

Perry4Law and PTLB have discussed the Cyber Law Trends and Developments of India 2013 (PDF), Cyber Security Trends and Developments in India 2013 (PDF) and Cyber Forensics Trends and Developments in India 2013 (PDF) so far. There may be other trends in pipeline as well.

For detailed analysis, the readers may see the cyber law, cyber security and cyber forensics trends. 

Friday, December 27, 2013

Bitcoins Websites In India Under Regulatory Scanner

Recently the Reserve Bank of India (RBI) cautioned users of virtual currencies against various risks. These include legal risks as well. RBI has not said anything new and it has just reiterated what many legal experts have been saying for long.

Further, although many Bitcoins websites in India have been either suspended or closed down yet the civil and criminal liabilities have already accrued. This means that all these Bitcoins websites owners can be prosecuted for violation of Indian laws even if the websites have been shut down.

In fact the enforcement directorate has already conducted searches against Seven Digital Cash LLP and its Bitcoin website – This means Seven Digital Cash LLP is now facing legal risks for dealing in Bitcoins in India. Not only Seven Digital Cash LLP but all other Bitcoins websites are equally under a very probable legal risk to get their accounts and business scrutinised by law enforcement agencies of India.

This situation has arisen because of the legal mistakes committed b y these websites. These Bitcoin websites must have followed the cyber law due diligence requirements and Internet intermediary guidelines. However, they have failed to do so and now they are facing a situation where serious criminal charged can be leveled against them.

Thursday, December 26, 2013

Seven Digital Cash LLP Facing Legal Risks For Dealing In Bitcoins In India

E-commerce websites in India are required to comply with many laws in India. However, most of the e-commerce websites are simply opened with great disregard to the Indian laws. As a result sooner or later they find themselves on the wrong side of the law. E-commerce websites frauds, crimes and offences have significantly increased in India and there is an urgent need to regulate them.

One such area that is grossly unregulated pertains to dealings in Bitcoins in India. Although it being too risky to deal in Bitcoins in India without complying with Indian laws yet many people and websites kept on dealing in the same. But the Reserve Bank of India (RBI) and Indian government were slow in reacting to the issue. Meanwhile, Bitcoins frauds and crimes were increasing world over, including in India.

Realising the gravity of the situation, the RBI cautioned users of virtual currencies against various risks. These include legal risks as well. With the present advisory, the websites and individuals dealing in Bitcoins in any manner whatsoever must comply with the techno legal requirements of Indian laws. Otherwise, they may find themselves in big trouble.

Many people and companies were dealing in Bitcoins in India with great disregard to the cyber law due diligence requirements and in active violation of the Internet intermediary liability rules framed under the Information Technology Act, 2000. The money laundering and foreign exchange laws of India were also not analysed before opening such Bitcoins websites.

In the first possible prosecution of individuals/company engaged in dealing in Bitcoins, searches were conducted on Seven Digital Cash LLP which owns a Bitcoin website – based in Ahmedabad. “We have conducted searches at 2-3 locations of Seven Digital Cash LLP and its website. The company was involved in buying and selling of Bitcoins in India, operating from Ahmedabad,” an ED official confirmed. The website has stopped operating online soon after the searches.

Although the website has stopped operating after the search, this would not absolve the people behind he website from civil and criminal liabilities for violation of any Indian law. This incidence is also an eye opener for other Bitcoins websites operating in India to fall in line with Indian laws. Otherwise, they may be prosecuted in the near future.

Tuesday, December 24, 2013

Bitcoin Users In India Vulnerable To Legal Actions: RBI

Reserve Bank of India (RBI) has reiterated what was explicit and was expected. Through a public advisory RBI declared that use of Bitcoins in India is legally risky. The advisory of RBI is in conformity with the views expressed by Perry4Law so far.

By taking this stand RBI has also clarified that use of Bitcoins in India must be in compliance with Indian laws. Otherwise, civil and criminal prosecutions can be initiated against the users of Bitcoins in India.

The legality of Bitcoins in India was never guaranteed. However, in order to jump upon the wagon band of Bitcoins, many Bitcoins entrepreneurs and stakeholders are openly violating the laws of India, especially the cyber law of India.

Techno legal experts have been maintaining that it is legally wrong to assume that dealings in Bitcoins in India if strictly legal as individuals and companies have to take care of the cyber law due diligence and Internet intermediary rules compliances. For instance, a platform selling and purchasing or trading in Bitcoins must not only comply with the provisions of Information Technology Act, 2000 but also with laws applicable to online trading and income tax.

With the present advisory, the websites and individuals dealing in Bitcoins in any manner whatsoever must comply with the techno legal requirements of Indian laws. Otherwise, they may find themselves in big trouble.

Cyber Frauds Due Diligence In Indian Companies Is Missing

The corporate environment is changing in India at a rapid rate. The Indian Companies Act, 2013 (PDF) has played a major role in the corporate environment of India. The Act has put a special emphasis on frauds investigation and sound corporate governance. The Serious Frauds Investigation Office (SFIO) has been entrusted with a greater responsibility to avoid commission of serious frauds by companies in India.

IT and cyber frauds in Indian companies are increasing. By their very nature these high profile crimes affect corporate sector. Indian companies are also facing increased corporate frauds, financial frauds, white color crimes and technological frauds. In order to prevent black money from being accumulated offshore, the Indian government has proposed establishment of Income Tax Overseas Units (ITOUs) of India in foreign countries.

As far as international aspects of cyber crimes are concerned, India has entered into mutual legal assistance treaties (MLAT) with many countries around the world. An Indo-American alert, watch and warn network for real time information sharing in cyber crime cases has also been established.

As per the Information Technology Act, 2000 and the Information Technology (Intermediary Guidelines) Rules, 2011, an Indian company providing technology and online services in India is an intermediary and it is required to follow cyber law due diligence to escape Internet intermediary liability in India. So if cyber crimes are committed using its network or infrastructure then such company is required to observe cyber law due diligence to escape Internet intermediary liability.

According to Perry4Law, the leading techno legal law firm of Asia, corporate frauds, financial frauds and cyber crimes are still on rise in India. Companies in India are not at all following cyber law due diligence requirements and this has resulted in increased cyber crimes and online frauds in India. These irregularities and crimes can be easily detected if an e-discovery exercise is undertaken by law enforcement agencies of India.

However, Indian companies, especially the telecom companies, are openly violating the laws of India. For instance, Tata Teleservices Limited (TTL) and Airtel are violating Indian cyber law that also to the full knowledge of department of telecommunication. Such violations must be stringently taken by Indian government and its departments.

In their own interest, Indian companies must observe cyber law due diligence so that cyber crimes and frauds can not only be prevented but they can also be successfully prosecuted.

Friday, December 13, 2013

Airtel And Tata Teleservices In Cyber Law Violation Controversy

Indian telecom companies like Airtel and Tata are flouting cyber law of India and that too within the knowledge of the Department of Telecommunication (DoT). It has been reported that both Tata and Airtel have violated the provisions of Information Technology Act, 2000 and the Internet intermediary rules.

The disclosure was initially made at the Cyber Crime Investigation Centre of India managed by Perry4Law’s Techno Legal Base (PTLB). According to Praveen Dalal, managing partner of New Delhi based law firm Perry4Law and leading techno legal expert of Asia, both Tata Teleservices Limited (TTL) and Airtel have failed to comply with Cyber Law Due Diligence Requirements as prescribed by the Information Technology Act, 2000.

TTL and Airtel have also violated the provisions of Information Technology (Intermediaries Guidelines) Rules, 2011 of India under Information Technology Act 2000 (PDF), informs Dalal.

This makes both the telecom companies TTL and Airtel as well as the officers in default to be prosecuted under the provisions of IT Act, 2000. Section 85(1) of the IT Act 2000 provides that where a person committing a contravention of any of the provisions of the IT Act 2000 or of any rule, direction or order made thereunder is a company, every person who, at the time the contravention was committed, was in charge of and was responsible to, the company for the conduct of business of the company as well as the company, shall be guilty of the contravention and shall be liable to be proceeded against and punished accordingly: Provided that nothing contained in this sub- section shall render any such person liable to punishment if he proves that the contravention took place without his knowledge or that he exercised all due diligence to prevent such contravention. However, since both Airtel and TTL have duly informed as per Indian laws and they have failed to observe cyber law due diligence, they have no protection under the proviso.

Further, Section 85(2) of the IT Act, 2000 provides that notwithstanding anything contained in sub- section (1), where a contravention of any of the provisions of this Act or of any rule, direction or order made thereunder has been committed by a company and it is proved that the contravention has taken place with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of the contravention and shall be liable to be proceeded against and punished accordingly.

Now since the Department of Information Technology (DIT), Department of Telecommunication (Dot) and Telecom Regulatory Authority of India (TRAI) are well aware of these negative developments on the part of TTL and Airtel, they must take suitable actions against the guilty companies and the officers in default.