The Indian Information Technology Act, 2000, commonly referred to as the IT Act, 2000, was enacted to provide a legal framework for electronic governance by giving recognition to electronic records and digital signatures. In 1996, the United Nations Commission on International Trade Law (UNCITRAL) adopted the model law on electronic commerce (E-commerce) to bring uniformity in the law in different countries. Further, the General Assembly of the United Nations recommended that all countries must consider this model law before making changes to their own laws. India became the 12th country to enable cyber law after it passed the Information Technology Act, 2000. The Information Technology Act, 2000 provides legal recognition to the transaction done via electronic exchange of data and other electronic means of communication or electronic commerce transactions. This also involves the use of alternatives to a paper-based method of communication and information storage to facilitate the electronic filing of documents with the Government agencies

Historical Background of the Act:

The 1990s saw a significant global shift towards the use of information technology and the internet. Countries around the world began to realize the need for legal frameworks to address the issues arising from the use of digital technologies. India was experiencing rapid growth in its IT industry, with the advent of software services and the proliferation of internet use. The need for legal recognition of electronic transactions and the regulation of cyber activities became increasingly apparent.

In 1996, UNCITRAL adopted the Model Law on Electronic Commerce to bring uniformity to the law regarding electronic commerce and transactions. India decided to base its IT Act on this model law to ensure it met international standards. The Indian government formed a group to draft the Information Technology Bill, focusing on providing a legal framework to facilitate electronic commerce and electronic governance. The bill aimed to promote and regulate the use of digital signatures and electronic records.

The Information Technology Bill was introduced in the Indian Parliament in 1999. After deliberations and modifications, the bill was passed by both houses of Parliament and received the President’s assent on June 9, 2000. The IT Act, 2000, came into effect on October 17, 2000.

Objectives of the Information Technology Act, 2000:

The Information Technology Act, 2000, was enacted with several key objectives in mind. These objectives are designed to promote the use of information technology, provide a legal framework for electronic transactions, and ensure the security and integrity of electronic data and communications. Here are the primary objectives of the IT Act, 2000:

• Legal Recognition of Electronic Transactions: To provide legal recognition to electronic records and digital signatures, ensuring that electronic transactions are treated on par with paper-based transactions.
• Facilitation of Electronic Governance: To facilitate electronic governance by enabling the acceptance and use of electronic records and digital signatures in government offices and agencies. To promote efficient delivery of government services through electronic means.
• Promotion of E-Commerce: To create an environment conducive to the growth of electronic commerce by providing legal validity to electronic transactions and records.
• Regulation of Certifying Authorities: To establish a regulatory framework for the appointment and functioning of certifying authorities who issue digital certificates for electronic signatures.
• Cybercrime Prevention and Penalties: To define and penalize various cybercrimes, such as hacking, identity theft, cyber-stalking, and cyber-terrorism. To provide for the prosecution of offenders and prescribe penalties for cybercrimes.
• Adjudication and Dispute Resolution: To provide a mechanism for the adjudication of disputes arising from electronic transactions and cybercrimes. To establish the Cyber Appellate Tribunal for hearing appeals against orders passed by adjudicating officers.
• Protection of Privacy and Data Security: To ensure the protection of sensitive personal data and information in the digital environment. To prescribe measures for data security, including the implementation of reasonable security practices and procedures.
• Facilitation of International Trade: To align with international standards and practices related to electronic commerce and data protection. To facilitate cross-border electronic transactions and cooperation in cybercrime investigations.
• Encouragement of IT Industry Growth: To promote the development and growth of the information technology sector in India by providing a supportive legal framework. To foster innovation and investment in IT infrastructure and services.
• Standardization and Interoperability: To promote the standardization of electronic processes and interoperability of IT systems to ensure seamless communication and transactions.
• Promotion of Electronic Fund Transfers: To give legal sanction and also facilitate the electronic transfer of funds between banks and financial institutions
• Grant Legal Recognition to Bankers: Grant legal recognition to bankers under the Evidence Act, 1891 and the Reserve Bank of India Act, 1934, for keeping the books of accounts in electronic form.

By achieving these objectives, the IT Act, 2000, aims to create a secure and efficient digital environment that supports the growth of e-governance, e-commerce, and the IT industry while protecting users and maintaining the integrity of electronic data and communications.

Salient Features of the Information Technology Act, 2000:

The salient features of The IT Act, 2000 are as follows –

• Digital signature has been replaced with electronic signature to make it a more technology neutral act.
• It elaborates on offenses, penalties, and breaches.
• It outlines the Justice Dispensation Systems for cyber-crimes.
• The Information Technology Act defines in a new section that cyber café is any facility from where the access to the internet is offered by any person in the ordinary course of business to the members of the public.
• It provides for the constitution of the Cyber Regulations Advisory Committee.
• The Information Technology Act is based on The Indian Penal Code, 1860, The Indian Evidence Act, 1872, The Bankers’ Books Evidence Act, 1891, The Reserve Bank of India Act, 1934, etc.
• It adds a provision to Section 81, which states that the provisions of the Act shall have overriding effect. The provision states that nothing contained in the Act shall restrict any person from exercising any right conferred under the Copyright Act, 1957.

Scheme of the IT Act, 2000:

The Act has 13 chapters, 90 sections and 2 schedules. The following are the chapters under the Act:

Chapter No.	Sections	Chapter Deals With
I	1 and 2	Preliminary
II	3 and 3A	Digital Signature and Electronic Signature
III	4 to 10A	Electronic Governance,
IV	11 to 13	Attribution, Acknowledgement and Despatch of Electronic Records
V	14 to 16	Secure Electronic Records and Secure Electronic Signature
VI	17 to 34	Regulation of Certifying Authorities
VII	35 to 39	Electronic Signature Certificates
VIII	40 to 42	Duties of Subscribers
IX	43 to 47	Penalties, Compensation and Adjudication
X	48 to 64	The Appellate Tribunal
XI	65 to 78	Offences
XII	79	Intermediaries not to be Liable in Certain Cases
XIIA	79A	Examiner of Electronic Evidence
XIII	80 to 90	Miscellaneous

The 2 schedules given in the Act are:

• Schedule I gives the documents and data where the Act is not applicable.
• Schedule II deals with electronic signatures or methods of authentication.

Applicability of the IT Act, 2000:

According to Section 1, the Act applies to the whole of India. The application of this Act also extends to extra-territorial jurisdiction, which means it applies to a person committing such an offence outside the country as well. If the source of the offence, i.e., a computer or any such device, lies in India, then the person will be punished according to the Act irrespective of his/her nationality.

Non-Applicability of the IT Act, 2000:

According to the First Schedule of the Information Technology Act, 2000, the Act is not applicable to the following documents:

• Execution of Negotiable Instrument under Negotiable Instruments Act, 1881, except cheques.
• Execution of a Power of Attorney under the Powers of Attorney Act, 1882.
• Creation of Trust under the Indian Trust Act, 1882.
• Execution of a Will under the Indian Succession Act, 1925 including any other testamentary disposition by whatever name called.
• Entering into a contract for the sale of conveyance of immovable property or any interest in such property.
• Any such class of documents or transactions as may be notified by the Central Government in the Gazette.

Amendment in 2008:

The significant contributions of the Amendment Act 2008 are as follows:

The Act introduced several definitions to bring in more clarity and make it more inclusive:

• Electronic signature “means authentication of any electronic record by a subscriber by means of the electronic technique specified in the second schedule and includes digital signature”
• Communication Device “means Cell Phones, Personal Digital Assistance (Sic), or combination of both or any other device used to communicate, send or transmit any text, video, audio, or image.”
• Cyber cafe “means any facility from where access to the internet is offered by any person in the ordinary course of business to the members of the public.”
• Cyber Security “means protecting information, equipment, devices, computer, computer resource, communication device and information stored therein from unauthorized access, use, disclosure, disruption, modification or destruction.”
• The Act also revised the definition of “Intermediary with respect to any particular electronic records, means any person who on behalf of another person receives, stores or transmits that record or provides any service with respect to that record and includes telecom service providers, network service providers, internet service providers, web hosting service providers, search engines, online payment sites, online-auction sites, online market places and cyber cafes.”.

The Act also brought in changes while addressing the penalties and compensations for damage to computer, computer system, etc. If an individual “destroys, deletes or alters any information residing in a computer resource or diminishes its value or utility or affects it injuriously by any means; steals, conceals, destroys or alters or causes any person to steal, conceal, destroy or alter any computer source code used for a computer resource with an intention to cause damage; he shall be liable to pay damages by way of compensation not exceeding one crore rupees to the person so affected.”

Computer Related Offences inserted sections (Section 66A) relating to “punishment for sending offensive messages through communication services”. It further said, “any electronic mail or electronic mail message for the purpose of causing annoyance or inconvenience or to deceive or to mislead the addressee or recipient about the origin of such messages shall be punishable with imprisonment”.

In 2015, another bill was initiated to amend Section 66A with the aim of safeguarding the fundamental rights guaranteed to citizens by the country’s Constitution. This was later accomplished by declaring it as violative of Article 19 of the Constitution.

Impact and Significance of the IT Act, 2000

The Information Technology Act, 2000, has had a profound impact on various aspects of life and business in India. Its significance extends across the legal, economic, social, and technological domains. Here are some of the key impacts and significance of the IT Act, 2000:

• Legal Recognition of Digital Transactions: The Act has given legal validity to electronic documents and digital signatures, making digital contracts, records, and communications legally enforceable. This has facilitated the widespread adoption of electronic transactions in both the public and private sectors.
• Enhanced E-Governance: The IT Act has enabled the government to offer services electronically, improving efficiency, accessibility, and transparency. Initiatives such as digital filing of tax returns, online issuance of certificates, and e-procurement have become possible due to the legal framework provided by the Act.
• Growth of E-Commerce: By providing a legal basis for electronic transactions, the IT Act has spurred the growth of e-commerce in India. Businesses and consumers can confidently engage in online transactions, leading to the expansion of digital marketplaces and services.
• Cybercrime Deterrence: The Act has defined various cybercrimes and established penalties for offenses such as hacking, identity theft, and cyber-stalking. This legal framework has helped in the prosecution of cybercriminals and has acted as a deterrent against cyber offenses.
• Regulation of Digital Signatures and Certifying Authorities: The IT Act regulates the issuance and use of digital signatures, ensuring their authenticity and reliability. It has established certifying authorities that provide digital certificates, which are crucial for secure electronic transactions.
• Data Security and Privacy: The Act mandates reasonable security practices and procedures for the protection of sensitive personal data. This has led to increased awareness and implementation of data protection measures among businesses and organizations.
• Dispute Resolution Mechanism: The establishment of adjudicating officers and the Cyber Appellate Tribunal has provided a mechanism for resolving disputes related to electronic transactions and cybercrimes. This has contributed to a more structured and efficient resolution of cyber-related disputes.
• Foundation for Digital India: The IT Act has laid the groundwork for the Digital India initiative, which aims to transform India into a digitally empowered society and knowledge economy. It has provided the necessary legal infrastructure for various digital initiatives and services.
• Boost to IT Industry: The Act has created a favourable environment for the growth of the IT and software services industry in India. It has attracted domestic and foreign investment in the IT sector, leading to job creation and economic growth.
• Alignment with International Standards: By incorporating principles from the UNCITRAL Model Law on Electronic Commerce, the IT Act aligns with international standards. This has facilitated cross-border electronic transactions and international trade.
• Promotion of Innovation: The legal recognition of electronic transactions and digital signatures has encouraged innovation in digital technologies and services. Start-ups and tech companies have been able to develop new products and services that rely on electronic records and signatures.
• Consumer Confidence: The legal protection provided by the IT Act has increased consumer confidence in online transactions. Consumers are more willing to engage in e-commerce and use digital services, knowing that their rights are protected by law.
• Enhanced Security Framework: The Act has prompted the adoption of cyber-security measures and best practices among businesses and government agencies. This has contributed to a more secure digital environment, protecting users from cyber threats.

Overall, the Information Technology Act, 2000, has been instrumental in shaping India’s digital landscape. It has provided the legal foundation for the growth of e-governance, e-commerce, and the IT industry, while ensuring the security and integrity of electronic transactions and data.

Conclusion:

The Information Technology Act, 2000, has been instrumental in transforming India into a digital economy. By addressing the legal, security, and regulatory aspects of electronic transactions and cyber activities, the Act has provided a solid foundation for the growth and development of e-governance, e-commerce, and the IT industry. Its importance and significance lie in its ability to create a secure and efficient digital environment, fostering innovation, protecting users, and aligning with global standards. As technology continues to evolve, the IT Act remains a critical framework, adaptable to new challenges and instrumental in shaping India’s digital future.