Cyber Law

Lesson 4
In last session, we have defined digital contract as “any agreement enforceable by law where
either the offer, acceptance, consideration or performance is in electronic form. In simplest
term we can say that the formation of contract is a game of offer and acceptance. For
example, a tender is floated on a website for construction of building and electronic bids are
invited for the same. This tender is not an offer but only an invitation to offer. When the
vendor will submit the bid, it will become offer and the acceptance of the bid would result in
a contract. Right, move further,
• Section 3 of the Indian Contract Act, 1872 says that where a proposal or acceptance of
any promise is made in words, the promise is said to be express. If it is made otherwise
than in words i.e. through act, movement eg. when you entered into the bus, you entry
will show your willingness to purchase the ticket such contract is said to be implied
contract. In E-contract generally contracts are expressed contracts. Ok…
• S-10A of Information Technology Act 2008
• Where in a contract formation
– The communication of proposals
– The acceptance of proposals
– The revocation of proposals and acceptances, (revocation means to take back) as
the case may be are expressed in electronic form or by means of an electronic
record
– Such contract shall not be denied or declared void on the ground that such
contract is in electronic form or electronic means was used for that purpose ok…
It thereby acknowledges the legal validity of e-contracts.

• Ideally, when parties enter into contract they discuss and negotiate terms of a contract ,
however it is not possible in electronic contract, because they are not face to face.
• Hence, internet contract is generally, a “Standard Form Contract” with a “Take it or
leave it option” to the other party which clause by clause discussion and agreement . Such
contracts are called as standard form contract.
• Unconscienceable Contracts:- In standard form contract sometimes, other party may
agree and sign the document but not with a complete mental agreement , in such cases
– if certain clauses are considered blatantly one sided and unfair, the Court can set
aside the contact as unconscienceable (अनकोन्सिएबल)
– Or expect the dominant party to exercise a greater “Disclosure Responsibility” by
highlighting onerous clauses and ensure that the other party has agreed to it of his
free will. Here, disclosure responsibility, means dominant party should
 disclose all material facts which can affect on the decision of the other to accept
the offer or not. Okkk---

We can see that the Indian Contract Act 1872 is not restrictive of the modus of communication.
The recognizes the technological communication for building contractual relationships between
transacting parties. For example, clicking on a specified part of website to signify offer or
acceptance, as the case may be, has become an important mode of communication to create
contractual relations over the internet. This type of contracts is called as “Click Wrap Contract”.
In “Click Wrap Contract” the proposer put the terms and conditions online and user of the
services or consumer of the product click on the box , “I agree” “or “I accept”, or sometime
write the words “I agree” “or “I accept”, and click on “Send”. These contracts are authorized by
the Indian Contract Act 1872.
Right, you can entered into the contract in this way but little bit care you have to take, notify all
the terms and conditions and then click the icon “I agree” or “I accept”, generally, it is given at
the end of terms and conditions. Read carefully, understand clearly and then click on the icon.
By mistake “clicking” happens so that there should be two layers. In first instance “I agree” and
second instance “I confirm”, in this case second click will be considered, so that the user will
get a chance to correct the mistake.
Thus, communication of offer and acceptance, revocation of offer and acceptance can be done in
electronic contract. I hope you have understood the click wrap contracts.

Let us discuss, shrink wrap contracts, it’s simple. In this type of a contract the warning is given
on the wrapper “By opening this package you agree that you have read and understood the
Microsoft Corporation Distribution Agreement affixed to this package and agree to its terms and
conditions”. Obviously, there is scope for debate and dispute. Though, such contracts are not so
much popular are valid, court says that a purchaser must have an opportunity to read conditions
before signifying his acceptance. If purchaser is not agreed to the terms and conditions, he can
return the software for a refund. Now we are at end part, challenges to digital contract, ICA
1872 was drafted much before the concept of digital transactions were born and How does ITA
2000/8 address issues peculiar to electronic documents, there are issues that we shall explore in
further discussions. 0k… till that good buy---