The Role of Adjudicators in ITA 2008
One of the strengths of ITA 2000 was the introduction of a system of
adjudication where a victim of a Cyber Crime could seek compensation by way
of damages through a system outside the usual civil court system. This
could help the system in three specific ways.
Firstly, the adjudicator could be a person who could be better informed on
technology issues than the traditional civil judge and hence could respond
better to the complications of technology.
Secondly, the system could be made quicker than the traditional system by
adopting a more consumer friendly process than the strict adherence of the
Civil Procedure Code.
Thirdly, the cost of litigation could be reduced from the current levels.
These objectives were sought to be achieved by ITA 2000 and the related
notification which came on 25th March 2003.
Accordingly, the system of adjudication before the current amendments
became effective was
a) An adjudicator had the powers to adjudicate on any contraventions under
the ITA 2000 and provide compensation to a person who has suffered a loss.
b) The powers of the adjudicator was the same as a "Civil Judge" but he was
not bound by the Civil Procedure Code.
c) The procedure was simple and the complainant could make an application
with a fee which was roughly around 2.5% of the amount of compensation
claimed.
d) The complaint could be made even when the complainant was perhaps not
fully aware of the details of the accused and the adjudicator could ask the
Police to investigate and report to him if required.
e) The adjudication proceedings were expected to be normally completed in 4
months or an extended period of another 2 months.
f) Compounding could be permitted any time during the process
g) Appeal was permitted to the Cyber Regulations Appellate Tribunal.
h) Powers of the adjudicator was "Exclusive" in the sense that no other
"Civil Court" had jurisdiction on the matter which an adjudicator was
entitled to hear.
i) Adjudicator had the powers to enforce payment of penalty imposed like a
"Revenue Recovery".
As a result of the above provisions, the "Adjudicator" was an important
part of the implementation of the ITA 2000 and its effectiveness to provide
remedy to the victims of Cyber Crimes in India.
Though ITA 2000 became effective from 17th October 2000, no adjudicator was
appointed until 25th March 2003 when the Government of India notified that
"IT Secretary of a State or Union Territory" would be the "Adjudicator of
that state or Union Territory". Since then the IT secretaries who have been
administering the IT development programmes in a State also became the key
judicial authority for the State.
Even after the adjudicators were appointed it took several years for
complaints to be formally made to the adjudicators and adjudicators also
took it up seriously.
Under ITA 2000, the maximum compensation that could be claimed under
Section 43 which was the main cause of action for the adjudicator was Rs 1
crore. Now under ITA 2008, this limit has been removed and hence the
compensation upto any amount can be claimed if the complainant can justify
the claim.
However, ITA 2008 now limits the powers of the adjudicator to Rs 5 Crores
and leaves higher claims to go to the Civil Judiciary system.
Further since Section 43 has been strengthened further with the addition of
sub sections (i) and (j) which bring in "deletion of information",
"diminishing the value or utility of information" etc within the section.
The powers of the adjudicator has therefore widened under ITA 2008.
Virtually any offence with the use of a Computer or a Mobile which can
cause wrongful harm or loss to any person can be subject to adjudication
either on the basis of a complaint or Suo-moto.
Additionally, the section 43A, which is a "Data Protection" measure where a
"Body Corporate" failing to maintain "Reasonable Security Practices" to
protect "sensitive personal information" also comes under "Adjudication".
In view of the above there is a need for State Governments to effectively
train the IT Secretaries and provide them with suitable support staff so
that they can discharge this additional responsibility effectively.
If necessary, the Central Government may also consider if it is time to
appoint an exclusive "Adjudicator" for each state and not burden the IT
Secretary with this responsibility which may try to take more and more of
the time of the IT secretary away from his developmental functions.
With the expansion of the powers of the adjudicators, it is also necessary
for adjudicators being ready to face the challenges to their powers
conferred by the Act for the benefit of the society.
Adjudicators should not in their anxiety to avoid the responsibilities cast
on them from the Act avoid taking up adjudication on one pretext or the
other. Such an attitude if it develops will seriously hurt the law and
order in the Digital Society and undermine the potential of the State to
attract investments from IT sector.
Some of the points that an adjudicator may be forced to consider during any
adjudication is a challenge to his jurisdiction. As is the practice in most
litigation, the strategy of some defense counsel is always to challenge the
jurisdiction of the authority so that the dispute is pushed into the
traditional Courts where the inherent delays can give a relief to the
accused.
Hence every effort has to be made to strengthen the conviction of the
Adjudicators so that they can effectively ward off a high profile advocate
challenging the jurisdiction of the adjudicator on some technical grounds.
The challenges to the Jurisdiction can be mounted on many grounds and in
particular on the following grounds.
a) Types of incidents
b) Vis-à-Vis the Consumer Forum
c) Vis-à-Vis arbitration clauses in agreements.
Some thoughts on these points are provided below
Types of Incidents
When ITA 2000 was originally notified the powers of the adjudicator under
Section 46 could be interpreted as restricted to contraventions under
the Chapter IX. However, under ITA 2008, with the introduction of
subsection (i) to the Section 43, which can be invoked if any person
without the permission of the owner of a computer system
"destroys, deletes or alters any information
residing in a computer resource or diminishes its value or utility or
affects it injuriously by any means", virtually any kind of
adverse effect on a computer or information residing inside a computer or
the functionality of either a computer or a software or the device itself,
come within the jurisdiction of the adjudicator.
Further, under 43(g) any person providing "assistance" to another
person to commit any contravention will also be liable under Section 43.
The words used in the section to describe the jurisdiction of the
adjudicator are:
For the purpose of adjudging under this Chapter
whether any person has committed a contravention of any of the provisions
of this Act or of any rule, regulation, direction or order made thereunder
which renders him liable to pay penalty or compensation,
Hence, the powers of the Adjudicator goes beyond Section 43 or 43A and into
any contravention under the Act and there is every ground to believe that
the scope of adjudication extends to all offences under Chapter XI also in
case it results in a loss to any person.
Consumer Forum
In many cases of Cyber Crimes, there will be a "Service Provider" involved
in the facilitation of the Crime. Under ITA 2000/8, the service provider
comes under the definition of an "Intermediary" and hence he would need to
satisfy certain "Due Diligence" requirements failing which he will be
liable for the offence. By operation of Section 85, some of these
liabilities may get transferred also to the executives.
However some times a doubt arises as to whether the dispute between the
customer and the service provider needs to be taken to the Consumer forum
instead of the Adjudicator.
Here it becomes necessary to interpret Section 61 of ITA 2000/8 which
states as under:
Sec 61:
No court shall have jurisdiction
to entertain any suit or proceeding in respect of any matter which an
adjudicating officer appointed under this Act or the Cyber Appellate
Tribunal constituted under this Act is empowered by or under this Act to
determine and no injunction shall be granted by any court or other
authority in respect of any action taken or to be taken in pursuance of
any power conferred by or under this Act.
Provided that the court may
exercise jurisdiction in cases where the claim for injury or damage
suffered by any person exceeds the maximum amount which can be awarded
under this Chapter.
It is clear from this section that the Adjudicator is given a prime of
place against all Civil Courts when the claim is related to a contravention
of ITA 2000.
Also, the Consumer Protection Act provides that remedies under that act is
not in derogation of any other Act. Also ITA 2000 is an act which was
subsequent to Consumer Protection Act. Hence remedies under Consumer
Protection Act are not interfering with the jurisdiction of the
Adjudicator. Also since Cyber Crimes are high tech crimes, Consumer Forums
may not be keen to take Cyber Crime related complaints under its forum.
It is also appropriate to consider that the jurisdiction of the
Consumer Forum arises out of "Deficiency" of service. Hence claims arising
out of a "Crime" are not within the jurisdiction of the consumer forum.
For all these reasons, Adjudicator's jurisdiction scores over Consumer
Forum even when there appears to be a dual jurisdiction. Hence in cases
such as Phishing or Credit Card frauds, Adjudicator is the correct forum in
preference to the Consumer Forum.
Arbitration
There have been a few instances where a service provider has invoked an
"Arbitration" clause to say that a dispute with his customer cannot come in
the jurisdiction of an Adjudicator. This is also a wrong contention since
"Arbitration" in a service contract can be applied only to service related
disputes where there is a overlapping jurisdiction with the Consumer forum.
But in cases where there is a prima-facie indication about a fraud or an
offence which may come under ITA 2000/8, then the correct jurisdiction is
with the Adjudicator and not the arbitration forum.
In one of the recent cases, a dispute arose between an online broking firm
and his customer. The allegation was that an employee of the share broking
firm had engaged in parallel trading in the name of the customer and caused
a loss. The customer was kept in the dark since the firm's manager had
created a false e-mail ID for the customer and registered it with the
account so that all contract notes are dumped in this e-mail account and
not be available to the customer. According to the customer this was a
Cyber Crime since the correct e-mail address was tampered with and changed
without authority. Such cases come under the jurisdiction of the
Adjudicator.
In view of the importance of "Adjudication" to the community, it is
necessary for all State Governments to take steps to equip their IT
Secretaries with at least one Deputy Secretary with the sole responsibility
of attending to Adjudication and create a secretariat to support the
activity. IT Secretary should also devote one specific day every week to
attend to Adjudications so that his other work does not cause delay in the
proceedings.
Naavi
March 26, 2009
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