naavi.org has received the following query from one of its visitors.
In view of the importance of this incident to the Netizens of India, a
brief discussion of the incident is provided here with a request for comments
from other visitors.
Quote:
I've got an inquiry regarding digital contracts and the solutions
under ITA-2000. Suppose a Netizen from India surfs on an American web site
and while surfing on it comes across an advertisement regarding a hairdryer.
Now he wants to buy the hairdryer and so he enters his credit card no.
in the said advertisement and buys the hair dryer for say $ 100. But he
doesn't receive the product within the proposed time. Now after making
enquiries regarding the said firm in America he finds out that it gave
a wrong mailing address and other contact information. Now what remedy
does he have under the Information Technology Act-2000.
Does he sue the firm in India or America?
Unquote
In the above case, the Indian buyer has actually entered into an import
contract with the seller through the Net. If the import takes place, the
payment has to be cleared by the Authorised Dealer as a foreign exchange
release under the provisions of FEMA. The item may also attract import
duty to be paid when it comes to India.
If for any reason the foreign exchange clearance is not given, the contract
becomes un-executable from the Indian's side. In genuine cases this may
lead to the foreign company suing the Indian for damages for placing a
contract without the ability to make the payment.
In the instant case, it is alleged that the product has not been delivered
and the company appears to have a false address. This is therefore a case
of interantional fraud and punishable in all civilized countreis.
We have come across another incident of such fraudulent activity some
time back from Australia where a company had sent out e-mails stating that
the recipient has won a "Prize" running to millions of dollars and what
was required was to confirm the win by sending 35 dollars. A fax number
had also been given in the communication. On enquiry it was found that
the Australian government had already taken steps to disable the fax and
the fraud attempt had been checked.
There was also a similar e-mail some time back about a "Nigerian Oil
Money" available under certain conditions. This was a repeat of the fraud
which was in vogue about 10 years back when a similar attempt was made
through faxes. The recipient would be lured with a low interest loan and
invited to come to London for further negotiations with initial brokerage
money. While this has not been checked out by the undersigned, it
was clearly another attempt to defraud the public. With the passage of
time, the mode of contact has changed but the intention remains same.
Now coming to the remedy under ITA-2000. ITA -2000 doesn't deal with
this sort of situations directly. However, these instances may be considered
an offense under IPC with the help of electronic documents. Section 75
of the ITA-2000 extends the jurisdiction of the Act to foreign nationals
and non residents. But the attempt to defraud with false documents is not
included as an offence under the Act. It has to be drawn from other Acts
such as the Indian Contract Act or the IPC. These Acts may not have jurisdiction
beyond India. Hence the usual procedure of trial in India followed by a
case in the respective country may be required. Filing a case in USA can
also be pursued if the resources of the complainant permits.
Further, if the identity of the person is not known, there may
be a need to "Investigate" before the trial is launched. Obviously an individual
cannot undertake international investigation. It has to be undertaken either
by a "Private Cyber Cop" or the Police and the Adjudicating Officer.
As has already been discussed in these columns earlier, there is no provision
for and individual to invoke the Adjudication proceedings for a private
crime. The remedy available to the complainant in the above case is to
pursue his case with the local courts with his resources only. At the end
of the trial he may be able to win a compensation of US $ 100 being
the cost of the order placed. There is no practical significance for the
remedy in this case in respect of the victim of this small ticket frauds.
However since the cumulative effect of such small ticket frauds on the
community is large, the Government has to take up the case on behalf of
the community.
Practical solutions to the above case would be to refuse payment to
the Bank and request a "Charge Back". If a case has to be pursued, we may
try to involve the web site owner as well as the digital certificate issuing
authority (if any) who has issued the certificate for the secured server
through which the payment could have been made.
The case however signifies the need to buy only from respectable sources,
and to verify the identity of the server through the digital certificate.
Readers should also be aware that in India, we cannot ignore the
foreign exchange regulations in making purchases on the Net.
Readers may be interested to peruse RBI
guidelines on use of Credit Cards for Net purchases for further information.
The undersigned is also pursuing a charge back request with Standard
Chartered Bank for a purchase made through Mcafee site on a one month trial
basis. I am not sure how co-operative the Bank would be and
keep the readers informed of the developments in this regard.
Naavi
March 24, 2001
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