Smart contracts
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This article has been written by Astha Dwivedi.


Today, due to technological advancement in the world, there is no barrier for communication and information is exchanged within a flash of seconds between different individuals. This is only possible because of the increase in the e-commerce world. E-commerce is a world where services, information and products are exchanged between parties through the digital platform. To regulate this e-commerce, the need for proper law is there. In this article, the author studies about different types of e-contract and the essential requirements which need to be fulfilled to form an enforceable e-contract. 

The Indian Contract Act, 1872 is the basis of all the contracts in India. The E-Contracts formed in India are also regulated by it along with the Information Technology Act, 2000 and the Indian Evidence Act, 1872. However, there are many issues and challenges in regulation of e-contracts with the help of these laws as none of them talks about the formation of an e-contract. The author tries to find out and analyze the issues in the law and also in e-contract. Further, the article also looks at the law of the USA and Mexico with respect to e-contract. Thus, through this article one can come to know different legal aspects of e-contract in India.


With the emergence of industrialization, westernization and development, the technological advances around the whole world have led to the drastic changes in the commerce and trade. Today, business and trade are not bound to any certain territorial boundaries and the need of physical presence at the place of contract. This type of business practices are known as e-commerce. As the internet has become the part of our daily lives since a decade, the e-commerce activities are also becoming the integral part of an individual’s life. From buying vegetables at online store to buying airline tickets, we don’t realize when we have become a part of this system of e-commerce. The growing use of e-commerce has made our life easy and sorted but it also increased the cases of crime and fraud. To regulate these type of contracts and make our work easy we came to know about different type of contract i.e. e- contracts.

E-Contracts are very much similar to the contracts except that they do not take place on article and pen but through online modes. These types of contract are convenient, time saving and efficient in nature. They function similarly likes other contracts where sellers represent their products to intended buyers with all the terms and conditions and the buyer after considering every aspect of the contract and negotiating it (if needed) confirms the deal and makes payment. Within a minute, the deal takes place by simply attaching the digital signatures of both the parties on an e-copy of the contract. Initially, there were many countries that were moving back and forth to recognize the legality of the e-contracts but today most of the countries have ratified their respective laws to acknowledge e-contracts. 

The foundation of e-commerce is valid e-contracts, so adequate attention must be given to the development of a valid e-contract before transactions are finalized and proceed. The parties’ autonomy to negotiate on the terms is completely maintained. E-contracts open up numerous market opportunities until the legal criteria are met. Since commercial companies use the Internet as a tool to disseminate and extend business practices, entering into many e-contracts becomes important.

In India, The Indian Contract Act, 1872 governs the e-contract, their formation and the remedies available for their breach like it does in article contract. The Information Act, 2000 and the Indian Evidence Act, 1872 also deals with certain provisions which are part of e-contracts. Via email agreements and online agreements, such as Browse Wrap Agreements, Shrink Wrap Agreements and Click Wrap Agreements, an individual can enter into an e-contract. However, there are certain pitfalls in Indian Contract Act while we talk about the electronic contracts. The Government of India needs to address these loopholes to facilitate the growth of e-contract in the society and also the citizens should be made aware of the laws and rights available to them while they are part of an e-contract. 


With the advent of globalization in the world, the need and value of e-contracts is increasing. Within some minutes the people sitting in one corner of the world can make deals with the person sitting in another corner of the world. This not only saves their time but also the cost of voyage, delay and any misunderstanding which may occur during the period of contract. In India, the legislation for the regulation of e-contracts is formed under the Indian Contract Act, 1872, the Information Technology Act, 2000, etc.

What are e-contracts?

E-contracts can be defined as contracts which are formed between two parties through the negotiations via any electronic means. They can also be known as online contracts, digital contracts and cyber contracts.

In e-contracts also, the goods and services are exchanged between the two parties for a certain amount of consideration.  These contracts are very similar in nature with the paper contracts except that they are drafted and signed electronically. Thus, the seller can directly reach to the consumer without the interference of a middleman.

E-contracts are formed on the basis of Uberrimae fidei doctrine. The “Uberrima fides” is a Latin term which means “utmost good faith”. In e-contracts, the parties are in direct contact with each other due to which the chances of misinformation or hiding of some material facts is very negligible and thus both the parties are completely dependent on each other for all the information. However, to complete the e-contract there are certain essentials which need to be fulfilled. They are stated below.

Essentials of an e-contract

As there are certain essential requirements to fulfil the paper-based contracts, in a very similar way, there are certain elements that need to be present in the formation of an e-contract. These elements are stated below.


In numerous contracts (whether be it on the web or regular) the offer isn’t made legitimately person to person. The buyer ‘peruses’ the accessible merchandise and enterprises which appear at the vendor’s site and afterwards picks whatever he might want to buy. This recommendation is not made by the site exhibiting the items accessible to be buying at a particular cost. This is chiefly a challenge to the proposal and hence it can be revoked whenever up to the hour of acknowledgment. The proposal is given by the customer on presenting the things in the practical ‘crate’ or ‘the shopping basket’ for installment.


There should be acceptance of offer. Generally, acceptance is the next step by the seller when the offer has been made by the client in light of a proposal to treat. The offer can be revoked anytime before the acknowledgment is done.

Lawful consideration

There must be the presence of lawful consideration for any contract to get enforceable by law i.e., there should be trade of something legal between both the parties. If the legal consideration is not present, the contract gets void. 

Lawful object

There should be the presence of lawful object in the contract. A contract surmises legality of the object of contract. In this manner, an arrangement for selling opiate medications or erotic entertainment films online is void.

Competent party

All the parties who are getting into the contract must be legitimately able to form a contract. Arrangements went into by uncouth people, for example, minors, maniacs, insolvents, and so forth are void.

Intention to form legal relationship

In contract, the parties forming contract should have the aim of forming legal relations.. In the event if it can be seen that the chances of lawful connection are zero from the parties at that point the possibility of shaping any agreement between them is zero. 

Free consent

There must be free and veritable assent. The consent by an individual is supposed to be free when it isn’t brought about by pressure, deception, unnecessary impact or misrepresentation. So, the desire of any party who are part of the contract should not be disrupted to enter into a contract. By and large, in internet agreements, particularly when the dynamic cooperation between the contracting parties is absent, e.g., contract existing between an online site and the consumer who buys from this website, a ‘navigate method’ guarantees free and authentic consent.

If all the above mentioned essential elements are fulfilled in an e-contract, then the contract formed is a valid e-contract.

Types of e-contract

The essential element which makes e-contracts different from paper based contract is that it takes place on an electronic platform. There are different types of e-contracts based on the mode of formation. These types are stated below:

Electronic mail Agreements

A message through an e-mail that passes on the unmistaken able intentions of the association may be considered as the binding contract which we can derive by the choice on account of Trimex International FZE versus Vedanta Aluminum Limited. In this case, while recognizing the adaption in the implementation of the business exchanges the honorable SC ignored the argument which said that the business exchanges on email didn’t certify to form agreements. The judgment came that when a contract is finished up either orally or it is saved in the form of hard copy, the basic fact which states that the parties should initiate and lay out the conventional agreement would affect neither the agreements acknowledgment which went into nor its use, nevertheless if the proper agreement was initialed”.

Online Agreements

The online agreements are of three kinds. They are:

The Click Wrap Agreements

In click-wrap arrangements, a party subsequent to experiencing the rules and situations mentioned on the site or system need basically to demonstrate their consent in front of the corresponding, by just clicking the ‘I Agree’ symbol or decrease by clicking on ‘I Disagree’. This kind of acknowledgment is normally done prior to accepting the product. Such agreements are broadly utilized on the web, regardless of whether it be conceding of consent to get to a webpage or downloading of any product or selling something through a site. This might be known as the making of agreements by lead. By tapping on any of these decisions, he acknowledges or decays the terms. In the event that he disagrees, the cycle is ended. There has been a very famous case in which click wrap agreement was accepted as valid and enforceable. 

The name of the case is Rudder vs. Microsoft Corporation. In this case, the offended parties started a legitimate demand asserting break by the Microsoft Company of some particular payment conditions in relation to Microsoft’s MSN Member Agreement. This agreement can be seen as the on-line “click-wrap” arrangement on which everyone was supposed to look down and read the instructions and after that give their consent by clicking on “I Agree” symbol before giving admittance to the management. Irrespective of the reality that the party to the contract who claimed wanted to lean on some of the standing of the Member Agreement, in putting forth the pursuit, the aggrieved side contested the resolution made with the help of law and gathering determination provisos whose sanction was tried by Microsoft. 

The aggrieved side claimed in the recognition of the fact that the complete Member Agreement was not possible at one moment as they weren’t informed of any arrangement like this due to which they were not able to enforce it. The honorable court discovered that the Member Agreement was enforceable because skimming some pages was like turning some pages of a big paper based contract and by not maintaining the arrangement, there is the possibility of tumult within commercial center, render inadequate e-trade & subvert the uprightness of any understanding went into thereby.

Shrink Wrap Agreements

An offer to have software in the shop, via e-mail or on the web has brought about the significant number of specific types of authorizing agreements. For example, software sold in stores is ordinarily bundled in a case or other holder and afterward enveloped by the unmistakable saran wrap. Through the unmistakable saran wrap on the container, the buyer can see the admonition that expresses the utilization of the product is dependent upon the details of a permit arrangement contained inside, an understanding that can’t be perused before acquisition of the product. 

The permit understanding for the most part clarifies that if the purchaser doesn’t wish to go into an agreement by buying the product, he should restore the item before opening the fixed bundle containing the CD on which the product lives. In the event that the product is gotten back with the fixed bundle unopened, a discount will be acquired. Justice Raveendran on account of Interglobe Aviation case definitively affirmed that a client might not have perused the terms isn’t ground for disregarding the significance of the guidelines. 

All things considered, the High Court didn’t consider the details of the Indigo Carriage simply because the individuals when buy ticket are not expected to peruse the terms. In any case, the Supreme Court overruled that thinking. The purchaser is in this manner, expected to peruse the terms in instances of shrink wraps also.

Browse Wrap or Web Wrap Contracts

The contract where the online clients can discover the rules and regulations at any place on the page which offers to sell items and travelling is known as web wrap contract. As indicated in these rules and regulations, utilizing their web page for purchasing a product or administration which is proposed comprises acknowledgment of the situations mentioned in that.

Above mentioned are the different types of e-contracts that take place in the global world. These different types of e-contracts are governed by various laws in India which are discussed in the next chapter.

E-contracts and Indian Law 

It is a transformation which altered contracts into e-contract. Yet, one thing we have to comprehend is that the electronic agreements that are prevalently known as the E-contracts represent a great deal of difficulties and legitimate issues which should be mulled over. In India, still there are no laws and regulations particularly related to e-contracts. However, they are regulated by various laws in unification. These laws are stated below:

The Indian Contract Act, 1872

The Indian Contract Act, 1872 regulates the way in which contracts are formed and enacted in India, so every agreement made which is formed should fulfill the sections of the respective act to enforce it legally. The arrangements of the Indian Contract Act are sufficiently wide to cover such exchanges. With respect to the development of contract except that with respect to any case if the offer or the acknowledgment of the offer is sent through electronic medium by the parties. In any case if the use of electronic medium is done then also that contract will be held legitimate and enforceable because regardless of the fact that the information was sent through a database, the affirmation of the will is important, implemented and it is enforceable. 

The Information Technology Act, 2000

Though the Indian Contract Act talked about the contracts, it never mentioned the legitimacy of an e-contract. Thus, The IT Act, 2000 came up with the legal recognition to the exchanges and deals that take place through electronic mode. The electronic agreements would be considered totally legitimate under the IT Act, 2000. According to the Section 3 of the IT Act, 2000, the verification of the electronic contracts is affirmed by fixing the electronic signatures on them by both the parties. Confirmation of electronic record by electronic signature or electronic validation method will be viewed as solid. In this manner an electronic agreement can be made by advanced marks and is perceived by the laws in India. 

According to Section 4 of the IT Act, 2000 lawful acknowledgment of e-records, where any Information is recorded as a hard copy, typewritten or printed structure is made accessible to a client in the electronic structure for ensuing reference will be considered to have fulfilled the necessity of law. In a layman’s language, this implies that any archive which is in the composed or printed variant would be dealt with same and will have the equivalent legitimacy in the electronic structure too. According to the recently presented Section 10A of the IT (Amendment) Act, 2008 unmistakably expresses that about the validation of agreements via electronic medium. 

Any contract which takes place electronically is deemed to be enforceable under Section 10A of the IT Act, 2000. It additionally sets out the instruments to which the IT Act, 2000 doesn’t matter, and it incorporates debatable instruments, power of attorney, a trust deed, a will, and agreements available to be purchased or move of Immovable Property.

Further IT Act, 2000 also mentions different punishments in different sections related to cybercrime. Section 65 to Section 71 mentions punishments related to cybercrime taking place in India.

Indian Evidence Act, 1872

At this point, this fact is very relevant that all the proof given and noted or kept away as electronic gadget is given the status of evidence. Like the voice note which is recorded with the help of the recording device. Presently, the advanced voice note recording instruments, computerized camera, advanced camcorders and video conference are being added as another measurement to this system of evidence. 

The hike in data and correspondence saw the major switch with the rise in the status of recorded electronic proof, produced or put away computerized as the important evidence. With the help of different sections in the respective Act, we can know the status of different evident in e-contracts. The provision 85A, 85B, 88A, 90A and 85C deal with the assumptions as to electronic records, though, Section 65B identifies with the tolerability of the electronic record.

Payment and Settlement Act, 2007

With the growing technology, the need for carrying cash with oneself has been decreasing because of the availability of online payments. The payment paths which balance a significant situation as the vendors used to pay money through online required a legitimate composition which was brought in the form of Payment and Settlement Systems Act, 2007 (PSS Act, 2007). Just like the 2007 PSS Act, the Payment and Settlement System Regulations, 2008 formed under the very Act became effective from 12 Aug, 2008. Additionally, the RBI has given some more rules stating that every single entryway and the payment software needs to register under the given demonstration. 

Electronic Commerce Act, 1998

Due to the happening of some different creative changes, the Indian Government and Legislatures were expected to ponder on and pass some critical change in the present lawful restricting laws of the nation and help to strengthen them seeing the overall population need. Notwithstanding, Justice Abu Fazal advisory gathering declined for endorsing change in the existing order of the Indian Contract Act,1872 so that they can become according to the new mechanical enhancements. 

The parliament of India found a solution for it by finishing another order which would bring new life to the existing laws of India in accordance with the Internet ups and down in the nation. To oversee the challenges related to the e-contracts, the Electronic Commerce Act, 1998 was brought. It relied upon the recommendation of the chamber that the future agreements would by and large be established on the web and electronic kinds of correspondence and affirmation in light of its perfection and speed. The Electronic Commerce Act was formed of the acts that were gained precisely from moved nations, for instance, Florida, Utah, UN State of Texas, Malaysia, Illinois and Singapore and then it was amended according to the necessities of states of nation to oversee various sorts of e-agreements. While making this Act all the online activities and all the duties and rights were kept in mind and then it was passed. 

This Act is comprised of 15 divisions whose important rules are laid down as such: 

The second part of the said Act keeps an eye on e-records and digital imprints. It lays down that the limited extraordinary case, e-record & stamps must agree an indistinct treatment from the records made of paper and checks the explanations behind consenting for the legal composed work, signature, evidentiary and record‐keeping necessities. The third part of the Act keeps an eye on the decency and affirmation of assured e-records and safe electronic imprints. The assured e-records and stamps describe particular arrangements of all the record and denotes which were overseen more critical evidentiary suppositions considering the updated immovable quality and the reliability.

The Electronic Commerce Act lays down the important requirements of the genuine e-contract. These are mentioned below: 

  1.  The presence of a strong e-record is necessary.
  2. All the e-record should be kept safe.
  3. The presence of trustable digital imprint should be there. If the chronicle is set apart by cutting edge checks then it should be respected to be secure electronic signature and subsequently it very well may be made sure about e-record.
  4. The correspondence of electronic administrators should be present which certify or illustrate. 

With unification of all the above mentioned laws, the electronic contract has helped a lot to many people in different ways. It has reduced the difference between the buyer and the seller in different ways which are discussed below. 

Decrease in distance between buyer and the seller

Today with the increasing use of technology, our whole world is dependent on the availability of the internet in our lives. From buying a flower pot to cracking a million dollar deal between two parties of different nations, everything can be through one click within a minute. This use of technology has helped a lot to people of various arenas. While sitting at home only an individual can earn lakhs due to the availability of electronic media. This all goes through a process of e-contract. E-contracts have become a part of our daily life and help us to save our time, money, transportation etc. 

Due to the presence of e-contracts, there are no intermediates between the buyer and seller which means that buyer and seller are in direct contact with each other. This leads the party to lesser misunderstandings, clear intentions of the other parties, direct negotiation, etc. They also save the time of the person. Earlier people used to travel from one country to another or used to send drafts and letters with respect to contract and wait for the response. This process used to consume a lot of time and money. But e-contracts have reduced this distance and time of the parties.

Today, while shopping online buyers know all the terms and conditions of the seller and its product. By clicking on “I Agree” he gives his/her confirmation for the offer and thus forms an e-contract. By this, the buyer can know all the details of the offered product along with price and offers available. Thus, through this he is in direct contact with the selling company and there are very negligible chances of any confusion with the party in contract.

Thus, if we look around we are surrounded by various numbers of e-contracts in our daily life which have made our life more easy and comfortable. But there are certain challenges which daily users of e-commerce has to face during e-contracts of different type. These challenges are mentioned below.

Challenges that come in e-contract

There are certain issues which the daily user of e-contract and e-commerce has to face. These challenges are mentioned below:

The Competence to Contract

One of the essential ingredients of the e-contract is that an individual who is becoming party to a contract is lawfully competent to become a part of an agreement.  Regularly there is an anonymous person becoming the part an agreement. The person sitting on the other side does not have any idea about the person who clicked on “I Agree” symbol is lawfully skillful to become the part of an agreement. The Capacity of party to form a contract is one of the essential points of the contract which is considered under the Indian Contract Act, 1872. Section 10, 11 and 12 of the Act cover the topics relating to the capacity of party to contract. Such contracts are void where the person is not competent to form contract. The situation may occur where the newborn child who is not mature gets into the contract by clicking on “I Agree” text or symbol.

The Free Consent of the Party

Free assent is a fundamental essential of a substantial agreement. In online agreements there is no extension for exchange. This is an incredible hindrance for the client. However, the alternative “live with or without it” exchange is consistently to the client. On account of LIC of India Vs Consumer Education and Research Center, the honorable SC gave judgment that “In spotted line contracts there would be no event for a more fragile gathering to deal as to accept to have equivalent bartering power”. He has either to acknowledge or leave the administration or merchandise as far as the dabbed line contract. The only possible choice he would be having is either to accept the preposterous or till the time ends, renounce the administration”. Hence it tends to be inferred that the client should be judicious while giving his agree to stay away from inconveniences.

Choice on the Applicable Law

There are 2 decisions provided by the Indian law to implement an individual’s purview, i.e., either to implement the gathering law or implement the law of the site of the exchange, or event that offered ascend to the prosecution in any case. The respectable courts are provided with the legal choice of deciding the lawful decision with the help of recognizing an arrangement with respect to law which is most closely related to the association. There is zero restriction that law of an outside nation can’t be applied or an Indian gathering couldn’t be dependent upon an unfamiliar locale. The accentuation is on to choose appropriate law.

Choice on the Court Jurisdiction

E-contracts give a wide extension for the reason of activity emerging at a lot of topographical areas. This may prompt recording of cases at better places. Safeguarding claims at numerous topographical areas could be both costly and disappointing. Consequently, decisions of party statements should be remembered for all online agreements. It bodes well for the online specialist provider to restrict their presentation to one purview as it were. 

In this manner an online specialist provider has no other choice except that they expose themselves to a discussion of single bunch people and material rules as it were. The client does not have any different decision, however, to acknowledge the specialist organizations Standard Terms and Conditions by clicking an onscreen text or symbol “I Agree”, “I Accept” or “Yes”.

Security And Privacy Challenge 

The developing size of web based business in India permits shoppers to buy merchandise through exchanges that are concurred, moved and gotten comfortable an open virtual organization climate. Therefore, there are various security and protection gives that are of 

Worry to the buyers which should be tended to.

Protection of Data

Innovation has assumed a fantastic part in upgrading the limit of web associations and organizations to gather and dissect tremendous measures of information identifying with the clients who only visit their sites. Accordingly, this raises a lot of worries about how this information is dealt with and utilized.

Prior to the appearance of the web, organizations used to follow their client’s buys exclusively and carefully, nonetheless, the position presently is that organizations can likewise record pages of sites that catch a client’s eye. For instance, a great deal of organizations demand their clients to enlist with the organization through their sites by giving individual data. Nonetheless, there are a lot of sites that decay administrations to clients in the event that they will not enroll with them. 

If the person availing the benefit chooses to register then there is no warranty that could be done with the use of that details. It is very often that companies are likely to send these details to another third party for some prohibited and unlawful act.

Theft of Identity

The problem of theft of identity is a big worry for the buyers who face encroachment on their privacy in this practical environment. The theft of identity is the wrongdoing of getting the individual or monetary data of someone else to utilize their personality to submit extortion, for example, making unapproved exchanges or buys. Data fraud is submitted from multiple points of view and the outcome is that casualties are regularly left with harm shockingly, finances, and notoriety. Notwithstanding, through the way toward imitating the shopper, the criminal’s products and enterprises are charged to the buyer and consequently starts an endless loop of money related misfortune that the customer faces. 

More often than not, customers don’t understand the impacts of data fraud promptly as the cheat as a rule starts by making little exchanges that are not entirely observable prior to proceeding onward to greater ones. Besides, the utilization of Visas, charge cards and other savvy cards can likewise prompt chronicle, following and selling of the shopper’s shopping and banking rehearsals. There are different procedures by which information robbery can be submitted.

This incorporates hacking, phishing, email satirizing, checking and wishing. Further, there is intellectual property theft that happens wherein robbery of material that is copyrighted or robbery of proprietary advantages happens. One of the most well known results of IP robbery is fake merchandise and theft. 

The wrongdoing of data fraud basically occurs in two stages; an unfair assortment of character of an individual and afterward the illegitimate utilization of such data with an expectation to cause legitimate mischief. Since wholesale fraud includes burglary and misrepresentation, the arrangements of fabrication under IPC, 1860 is frequently conjured. 

Sections, for example, fabrication, making bogus archives, falsification for motivation behind cheating, notoriety, utilizing as real a fashioned report and ownership of a record known to be manufactured and expecting to utilize it as real can be coupled and perused with different areas of the IT Act. 

The sections from the IT Act that manage digital robbery incorporate Sec 66 read with Sec 43 which expresses that if any individual, unscrupulously or falsely, does any demonstration that makes harm the computer or computer framework without the proprietor’s consent, at that point that person is liable with either imprisonment for the time span of 3 year or fine of INR 5 lakhs or both. 

Moreover, Sec 66B gives discipline to any individual who untrustworthily gets taken computer assets or specialized gadgets. Sec 66C accommodates the discipline of theft of identity as whomever, falsely or untrustworthy utilizes somebody’s electronic mark, secret phrase or other interesting ID highlights will be imprisoned for 3 years or fine of INR 1 lakh. Sec 66D was embedded to rebuff cheating by pantomime utilizing computer assets.

Thus, above mentioned are the various issues which one may face in e-contract.

E-contracts around the world 

As mentioned earlier that with growing technology the scope of e-commerce is increasing and with the increase in e-commerce, the scope of e-contract has also increased in various countries. In chapter three of the article, we will know about the electronic contracts in different countries along with India.  

E-contracts in USA

The advancement of electronic exchange has generally extended the usage of e-agreements into speedier or contemporary style to deal with work together. In the time period of 1998 and 2002 most countries changed their family unit business establishment to see electronic agreements and checks in the form of legal devices. But then also some small countries are finishing the challenge of e-contracts. In light of everything, disregarding the constant augmentation of electronic business and the affirmation of laws making sure about online business gets, various associations and Internet customers do not have any knowledge with respect to the laws which can be used in their e-commerce business. 

A parallel ongoing law comprises a fundamental legal structure for e-agreements in country like the USA. Irrespective of the given specific rules and regulations, some law are present at the global level which can be implied on the e-agreement only when the lawfully restricting social occasions decide that they will bent down before these laws. 

The Uniform Electronic Transactions Act (UETA) can be known as a basic United States authorization item for an e-agreement. As shown through Art. 3 and 4 of UETA, only implements on trades related to business and government matters; also trades which are done through e-methods. Then there is U.C. Electronic Signatures in Global and National Commerce Act (E-Sign Act), 2001. This very Act sees an arrangement authenticity which is entered through digital pathway and it also oversees the combination of e-imprints. An essential explanation behind the very Act is to give a vague expert to the e-agreements through the accomplice based on paper. 

Uniform Computer Information Transaction Act (UCITA) is a significant record of the proposed U.S. law which is pertinent for an improvement in e- agreements, especially towards the e-contract on digital platform or “PC information trades” as known by the Act. UCITA was grasped by various nations and some of the nations who have received UCITA have brought different amendments in the principal substance of UCITA. Thusly, whenever overseeing allowing or computer programming trade is seen within the US, the inspection to see if the UCITA’s rules are applied by the nation overseer becomes important.  

E-contracts in Malaysia

Regardless of a way in which marketing is developing in the basic pace, different obstacles continue hampering its improvement. One prevention is co-jointed with the advancement in an e-agreement. This leaves the weakness that if according to the e-contracts the customary guidelines related to the laws may be brought to change. Hence due to this, we may see the variation in the formation of an e-contract in different countries. 

The very challenge should point out in the direction with the purpose of helping the dependability of e-trades especially while proposing the items as the subsequent duties and liabilities of the party to contract would depend on if a statement was made amongst them. Certainly, the e-agreement made nowadays is not like the ordinary agreement that points out different emerging issues related to law. Considering genuine Malaysian implementation and the relationship with United Nations Commission on International Trade Law (UNCITRAL) Model Law on Electronic Commerce and furthermore U.K. law & E.U. Directives on web trade, the research article attempts in examination & recognition of challenges relating to crime with the concern over the development of e-contract. 

This merge all the discussion to form an implementable agreement, an appropriateness of a postal run and what are its function over e-mail, a formed agreement necessity, electronic mark and a weakness that how and where an e-contract should be outlined. Moreover, this research article takes a gander at huge Malaysian institution on course of action of e-contract including the Contracts Act 1950, Sale of Goods Act 195, Electronic Trade Act 2006 and the Digital Signature Act 1997 and the abundance of the current law in guaranteeing e-purchasers.

E-contracts in India

Agreements have ended up being so fundamental in regular day to day existence that as a general rule there is no realization of when one has become the part of an e-contract. Proper from buying a snack to buying online tickets of the airplane, in our daily life we come across to different types of contract. The Indian Contract Act, 1872 regulates the formation and execution of agreements in the country as the name of the Act suggests.

The Act controls the way the plans are completed with an understanding and orders the effect of a break of definitive courses of action. It gives an arrangement of principles and controls, which regulates improvement along with implementation of understanding. The party to the contract chooses their own privilege and commitment to the association along with the reference of comprehension. 

A court is responsible to understand the event where the contract is not executed. For the profitability, solace and speed, the e-contracts are considered special and important. Imagine a situation where one Indian and one American party want to enter into a contract. There are two option i.e., either one party collects and signs the contract and courier it to the other party, who on receiving it signs the paper and courier it back or the second option can be treated as the two parties give their consent to meet at one place and form the agreement. 

With the advancement and growth of the tech world, within a second or more, the whole trade can get finished only through the help of an e-copy of the contract and the mutual understanding between the parties. The need to have money to travel miles and wait for the couriers is not required today. From the start only, there exist a doubt between the bodies that were responsible to make laws with the development of e-contracts but then also, today almost all the nations are having laws with respect to e-contract. 

In the case of e-agreements, the customary laws are not enough to solve all the challenges related to e-contracts. In the case of India, the basic laws which are related to contracts is The Indian Contract Act 1872 which today lacks many aspects to solve the problems arising out of an E-Contracts. The Information Technology Act, 2000 was established by the parliament of India to understand the challenges which may occur in the turn of events and the approval of e-contract. 


E-contract has globally made an amazing development particularly from the times of contract where everything was based on article. As of now, with the increase in development and e-commerce, e-contract is growing further especially when we talk about India. The pattern of progress in digital banking along with debit cards with the increase in professional users and web developers will uphold this process of development. Right now, the most important part is the law that envelopes all the parts of e-agreements expanding from downloading a small app to making and launching one, everything can be done through the digital medium. 

The progress in laws like this will regulate the progress in sites and how they are earning money. They will be under constant surveillance of law and this will reduce the rate of crime and fraud. Since today every trade, agreement and business is taking through the digital medium with the help of different software and platforms, there is zero percent chance of any direct interaction. Here, the principle prime connection is in the form of trust of clients and partners and at any cost it should be maintained.

In India, though there are laws which govern contract between two individuals through Indian Contract Act, 1872 but these laws are not made by keeping the thought of e-contracts in mind. The various sections which talk about consideration, competence to contract, place of contract, etc. don’t fit completely with the situation of e-contract as in an e-contract a lunatic, a minor can also just click the tab and form the e-contract. In e-contracts, the situation for negotiation is also negligible which makes them more inconvenient. 

The major problem which one can face during e-contracts is security of data. The various websites on which we surf about different things can anytime steal our data for their profit and an individual can’t get to know about it. The IT Act, 2000 came with various provisions which talked about the e-contract and the punishments for the identity theft, forgery, etc. but none of the act is there which is having provisions related to the formation of e-contracts. 

Therefore to develop and regulate this field, we need a law to be formed which can found out the entire people who use different websites as a major pathway in minting cash. It will also help in formation and development of different contract and trade and would be present as a defense for all the web pages who act for the formation of e-contract. In the same way, there is the need of an expert to solve the grievance of all the people with respect to the e-agreements by sitting in the consumer court. For this, there is the requirement of an expert in this area like payment security. 

By this, people will come to the consumer court with their problems and a rapid address and solution can be made of all the exchanges in the e-agreement. E-contract which is a creating fragment in the business fields booked to develop and it is the responsibility of the predominant players to guarantee that development isn’t obstructed by their demonstrations and approaches. Thus, with proper approach and law the e-contracts can be developed into a big factor of development and progress in the country.



  1. Indian Contract Act, 1872.
  2. Information Technology Act, 2000.
  3. Indian Evidence Act, 1872.
  4. Payment and Settlement System Act, 2007.
  5. Electronic Commerce Act, 2007.
  6. Uniform Electronic Transaction Act.
  7. U.C. Electronic Signature in Global and National Commerce Act (E-Sign Act), 2001. 


  1. Interglobe Aviation Ltd v. N. Satchidanand, 2011.
  2. LIC of India v. Consumer Education and Research Centre, 1995 3 SCC 42.
  3. Rudder vs. Microsoft Corporation (1992), 2 CRR (4th) 474.
  4. Trimex International FZE v. Vedanta Aluminum Limited, 2010 (1) SCALE 574.


  1. Avtar Singh, Contract and Specific Relief, Eastern Book Company, 12th Edition.
  2. Dr. V Nageswara Rao, the Indian Evidence Act, Lexis Nexis, 3rd Edition. 


  1. Electronic Contract in India by Shubhada Gholap.
  2. E-Contracts and Issues Involved in its Formation by Aniket Waghdhare.
  3. All about E- Contracts-Meaning, Types & Law by Shreyans Ranka.
  4. Legal Issues Involved in an E-Contract by Bhanu Srivastava and Balendu Bhushan.
  5. E-Contract in India: The Legal Framework, Issues and Challenges by Sethuram Sundaram.
  6. Legal Issues Arising in E-Contracts in India: An Analysis by S.R. Subaashini. 



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