E-Contracts: Meaning, Types, Validity, and Remedies

Most agreements these days are online – they are as simple as clicking "I Agree" on an app or signing a loan agreement with Aadhaar e-sign. These are all e-contracts, and they are legally valid under the Information Technology Act, 2000; the Indian Contract Act, 1872 and the rules of evidence under the Bharatiya Sakshya Adhiniyam, 2023 (BSA) in India.

What is an E-Contract?

E-contract is an agreement made, signed, and executed electronically without any sort of paper world. The fact that they are formed by electronic means has been recognised in Section 10A of the IT Act. However, contracts through electronic means are now acceptable. The essentials of a valid contract (namely, offer, acceptance, lawful object, consideration, and consent) continue to apply. Certain documents, such as wills, negotiable instruments, and deeds of sale of property, do not come under e-contracts.

Types of E-Contracts

Do E-Contracts Need Stamp Duty or Registration?

• Stamp duty should be paid whenever it is required by law, such as in the case of leases, loans, or partnerships. The stamp duty may be paid through e-stamping.
• Affidavit/Notarisation: to be required only where prescribed (e.g., an affidavit for name change).
• Registration: Physical registration of property sale deeds, wills, and similar documents continues to be a requirement.
• No stamp: Ordinary online shopping, app agreements, or subscriptions.

What Happens in Case of Breach?

E-Contracts as Evidence under New Law (BSA, 2023)

Earlier, Sections 65A & 65B of the Evidence Act governed the e-evidence; now, under the BSA, 2023 (Sections 61-63). Admissibility of electronic records is through the HASH certificate only. Because the HASH value indicates that the file has not been tampered with. The certificate is to be issued by the person having control over the device/server or by an authorised officer. Without HASH, it can be rejected.

How is a HASH certificate made?

• An electronic file processed through the HA algorithm (e.g., SHA-256).
• It creates a unique alphanumeric value (digital fingerprint).
• The certificate contains the description of the file, device information, time of creation of HASH, HASH value and signature of the responsible person.

Cost / Fees

There is no government fixed fee; costs are primarily technical. HASH values can be generated from labs, digital forensic experts or IT departments of companies. It is to be signed by the authorised officer or certifying authority for the court.

What to Know Before Signing an E-Contract

• Learn about terms (pay attention to hidden charges).
• Check the jurisdiction clause.
• Such stamp duty/registration is required to confirm that it is duly paid.
• Preferable digital signature/e-sign for authenticity.
• Review privacy/data use ends.
• Review the arbitration clause.
• Refunds/cancellations.
• Check refund/cancellation and auto-renewal.
• Ensure that the contract is written in clear language.
• Keep in mind: Clicking on "I Agree" = binding consent.

Where to Complain First?

Fees for Filing E-Contract Disputes

• Civil/Commercial Courts: Claims up to ₹1,00,000+ (dependent according to state).
• Consumer Commissions (edaakhil.nic.in):
  • Up to ₹5 lakh → No fee
  • ₹5-10 lakh → ₹200
  • ₹10-20 lakh → ₹400
  • ₹20-50 lakh → ₹1,000
  • ₹50 lakh-1 crore → ₹2,000
  • More than a crore → ₹5,000
• Arbitration: As per the Fourth Schedule of the Arbitration Act, it can run into lakhs.
• Online and Offline: The same fee, but savings on travel and postage through online facilities.

FAQs on E-Contracts

Q1: Are e-contracts valid in India?

 Yes, under the IT Act, 2000 and the Contract Act, 1872.

Q2: Do they require a HASH certificate in court?

 Yes, as per BSA 2023 for admissibility of electronic records.

Q3: Can I sign by typing my name?

 No, use a digital signature or Aadhaar e-sign.

Q4: Do e-contracts need stamp paper?

 Only if that category (lease, loan, partnership) requires it.

Q5: Can property sale deeds be e-contracts?

 No, you must be registered physically.

Q6: What is the strongest proof of an e-contract?

 Digital Signature Certificate (DSC) + HASH certificate.

Q7: Are consumer disputes from online shopping e-contracts?

 Yes, file at https://e-jagriti.gov.in/

Q8: What if there's an arbitration clause?

 You must go for arbitration first.

Q9: Who regulates e-contracts?

 No single regulator; the IT Act, Contract Act, Consumer Act, RBI, and IRDAI apply.

Q10: What about foreign jurisdiction clauses?

 Indian courts may uphold unless unfair to the consumer.

Q11: Can minors sign e-contracts?

 No, contracts with minors are void.

Q12: What is a HASH certificate in simple terms?

It is a digital fingerprint proving that the file wasn't altered.

Q13: Is Aadhaar OTP e-sign valid?

 Yes, under the IT Act, 2000.

Q14: Can WhatsApp messages be contracts?

 Yes, if a clear offer and acceptance plus intent can be shown + HASH certification for evidence.

Q15: Do freelancers need e-contracts?

 Yes, emails or e-sign agreements protect legally.

Q16: Can e-contracts be notarised online?

 Normally no, only e-notary projects in a few states.

Q17: Is it safe to share Aadhaar for e-signing?

 Yes, via UIDAI-authorised platforms.

Q18: What if the company has no grievance officer?

 Violation of E-Commerce Rules, 2020 → complain directly to the Consumer Commission.

Q19: Can foreign companies enforce e-contracts in India?

Yes, but disputes in India must follow Indian law.

Q20: Is there a fee for a HASH certificate?

 Not fixed by the govt; it depends on the expert/agency issuing it.

Summary

E-contracts are enforceable in full along with the rest of the world. HASH certification is a new rule for admissibility in court under BSA 2023. Risks for individuals include hidden terms and data use, whereas businesses must consider stamping, jurisdiction, and arbitration clauses. Always read before you click "I Agree".