E-business laws not
VARIOUS laws to safeguard the interests of buyers and sellers notwithstanding, the position of the Indian consumer on the Internet remains unsatisfactory, says a new book. The Consumer Protection Act, 1986 and the Sale of Goods Act, 1930, protect the interests of the consumer in transactions within the country where suppliers and buyers are residents. However, they fail to address many legal issues arising out of electronic transactions, says the book, Legal Issues in Electronic Commerce.
The book, written by legal expert T Ramappa, says "the basic areas in which legal issues are bound to arise while dealing with another in a commercial transaction through the
Internet are rights in domain names, Intellectual Property Rights, Consumer Protection, contractual relationship between businesses and privacy.
"The Information Technology Act, 2000 that India has enacted does not deal with many of these issues," says Ramappa.
"Issues arising out of the proposal subject to tax goods delivered online, in the country of receipt and the means of coming to terms with the concept of ‘the place of business establishment’ in the Internet sales for purposes of inviting tax liability need to be looked into," says Ramappa in the book.
The Consumer Protection Act has territorial application within India only. Also, it does not include goods acquired for resale or for any other commercial purpose. Moreover, under the Act a person may only raise a dispute that the goods suffer from a defect or that service supplied suffers from a deficiency, says Ramappa. He says the Act’s primary purpose was to settle consumer disputes after they have arisen and not the prescription of the basic rights and obligations of a seller and consumer, for which in case of sale of movable goods, one has to turn to the Sale of Goods Act.
The rights and obligations in providing of services is a matter left to contrast between the parties, there being no specific enactment covering the subject, which is a handicap to the consumer.
On the other hand, the Sales of Goods Act does not prohibit any term of a contract that may be considered to be unfair to the consumer, mainly because that Act is not legislation specifically intended for consumer protection. Consumer credit in India is still unregulated. The consumer does not have the necessary information on the true and effective cost of credit extended to him and the nature of justification for the various charges imposed on him.
Not only is the consumer’s freedom to negotiate reasonable terms not secured, but the market in which all trading is taking place also does not provide him with relevant information for taking a proper decision, Ramappa argues. He, however, says the Internet is one of the best things that could have happened but one has to understand that the Internet is a world of its own and that the law of the Internet governing transactions in the electronic marketplace is still evolving.
Electronic commerce may be said to be in its infancy in India, though world over it has quickened the pace of doing business.
In a seamless market, there is wider choice of buyers and suppliers and delivery of foods and services could be faster than it is in the physical market. Goods such as software and music may be delivered through the Internet instantaneously on conclusion of the contract, says the book.
Geographical boundaries do not matter. Buying online can be done both from office and home at lower transaction costs.
Where the transaction
leads to a dispute, the apparent advantage of trading through the
Internet present special problems. The laws relating to the rights of
buyers and sellers, particularly relating to consumer goods are not
uniform in all countries, Ramappa says. —