An Analysis of the Cases Filed under Section 46 of the Information Technology Act, 2000 for Adjudication in the State of Maharashtra

Background

Section 46 of the Act grants the Central Government the power to appoint an adjudicating officer to hold an enquiry to adjudge, upon complaints being filed before that adjudicating officer, contraventions of the Act. The adjudicating officer may be of the Central Government or of the State Government [see section 46(1) of the Act], must have field experience with information technology and law [see section 46(3) of the Act] and exercises jurisdiction over claims for damages up to `5,00,00,000 [see section 46(1A) of the Act]. For the purpose of adjudication, the officer is vested with certain powers of a civil court [see section 46(5) of the Act] and must follow basic principles of natural justice while conducting adjudications [see section 46(2) of the Act]. Hence, the adjudicating officer appointed under section 46 is a quasi-judicial authority.

In addition, the quasi-judicial adjudicating officer may impose penalties, thereby vesting him with some of the powers of a criminal court [see section 46(2) of the Act], and award compensation, the quantum of which is to be determined after taking into account factors including unfair advantage, loss and repeat offences [see section 47 of the Act]. The adjudicating officer may impose penalties for any of the offences described in section 43, section 44 and section 45 of the Act; and, further, may award compensation for losses suffered as a result of contraventions of section 43 and section 43A. The text of these sections is reproduced in the Schedule below. Further law as to the appointment of the adjudicating officer and the procedure attendant on all adjudications was made by Information Technology (Qualification and Experience of Adjudicating Officers and the Manner of Holding Enquiry) Rules, 2003.[1]

It is clear that the adjudicating officer is vested with significant judicial powers, including the power to enforce certain criminal penalties, and is an important quasi-judicial authority.

Excursus

At the outset, it is important to understand the distinction between compensation and damages. Compensation is a sum of money awarded by a civil court, before or along with the primary decree, to indemnify a person for injury or loss. It is usually awarded to a person who has a suffered a monetary loss as a result of the acts or omissions of another party. Its quantification is usually guided by principles of equity. [See Shantilal Mangaldas AIR 1969 SC 634 and Ranbir Kumar Arora AIR 1983 P&H 431]. On the hand, damages are punitive and, in addition to restoring an indemnitee to wholeness, may be imposed to deter an offender, punish exemplary offences, and recover consequential losses, amongst other objectives. Damages that are punitive, while not judicially popular in India, are usually imposed by a criminal court in common law jurisdictions. They are distinct from civil and equitable actions. [See the seminal case of The Owners of the Steamship Mediana [1900] AC 113 (HL)].

Unfortunately, section 46 of the Act uses the terms “damage”, “injury” and “compensation” interchangeably without regard for the long and rich jurisprudence that finds them to be different concepts.

The Cases related to Privacy

In the State of Maharashtra, there have been a total of 47 cases filed under section 46 of the Act. Of these, 33 cases have been disposed of by the Adjudicating Officer and 14 are currently pending disposal. [2] At least three of these cases before the Adjudicating Officer deal with issues related to privacy of communications and personal data. They are:

In all three cases the Adjudicating Officer was called upon to determine and penalise unauthorised access to personal data of the complainants. In the Vinod Kaushik case, the complainants’ emails and chat sessions were accessed, copied and made available to the police for legal proceedings without the permission of the complainants. In the Amit Patwardhan and Nirmalkumar Bagherwal cases, the complainants’ financial information in the form of bank account statements were obtained from their respective banks without their consent and used against them in legal proceedings.

The Vinod Kaushik complaint was filed in 2010 for privacy violations committed between 2008 and 2009. The complaint was made against the complainant’s daughter-in-law – the respondent, who was estranged from her husband, the complainant’s son. The respondent had, independent of the proceedings before the Adjudicating Officer, instituted criminal proceedings alleging cruelty and dowry-related harassment against her estranged husband and the complainant. To support some of the claims made in the criminal proceedings, the respondent accessed the email accounts of her estranged husband and the complainant and printed copies of certain communications, both emails and chat transcripts. The complaint to the Adjudicating Officer was made in relation to these emails and chat transcripts that were obtained without the consent and knowledge of the complainant and his son. On 09.08.2010, the then Adjudicating Officer dismissed the complaint after finding that, owing to the marriage between the respondent and the complainant’s son, there was a relation of mutual trust between them that resulted in the complainant and his son consensually sharing their email account passwords with the respondent. This ruling was appealed to the Cyber Appellate Tribunal ("CyAT") which, in a decision of 29.06.2011, found irregularities in the complainant’s son’s privity to the proceedings and remanded the complaint to the Adjudicating Officer for re-adjudication. The re-adjudication, which was conducted by Shri Rajesh Aggarwal as Adjudicating Officer, resulted in a final order of 10.10.2011 ("the final order") that is the subject of this analysis. The final order found that the respondent had violated the privacy of the complainant and his son by her unauthorised access of their email accounts and sharing of their private communications. However, the Adjudicating Officer found that the intent of the unauthorised access – to obtain evidence to support a criminal proceeding – was mitigatory and hence ordered the respondent to pay only a small token amount in compensation, not to the complainants but instead to the State Treasury. The Delhi High Court, which was moved in appeal because the CyAT was non-functional, upheld the final order in its decision of 27.01.2012.

The Amit Patwardhan complaint was filed against the complainant’s ex-employer – the respondent, for illegally obtaining copies of the complainant’s bank account statement. The complainant had left the employ of the respondent to work with a competing business company but not before colluding with the competing business company and diverting the respondent’s customers to them. For redress, the respondent filed suit for a decree of compensation and lead the complainant’s bank statements in evidence to prove unlawful gratification. Since the bank statements were obtained electronically by the respondent without the complainant’s consent, the jurisdiction of the Adjudicating Officer was invoked. In his order of 15.04.2013, Shri Rajesh Aggarwal, the Adjudicating Officer, found that the respondent had, by unlawfully obtaining the complainant’s bank account statements which constitute sensitive personal data, violated the complainant’s privacy. The Adjudicating Officer astutely applied the equitable doctrine of clean hands to deny compensation to the complainant; however, because the complainant’s bank was not a party to the complaint, the Adjudicating Officer was unable to make a ruling on the lack of action by the bank to protect the sensitive personal data of its depositors.

The Nirmalkumar Bagherwal complaint bears a few similarities to the preceding two cases. Like the Vinod Kaushik matter, the issue concerned the manner in which a wife, estranged but still legally married, accessed electronic records of personal data of the complainants; and, like the Amit Patwardhan matter, the object of the privacy violation was the bank account statements of the complainants that constitute sensitive personal data. The respondent was the estranged wife of one of the complainants who, along with his complainant father, managed the third complainant company. To support her claim for maintenance from the complainant and his family in an independent legal proceeding, the respondent obtained certain bank account statements of the complainants without their consent and, possibly, with the collusion of the respondent bank. After reviewing relevant law from the European Union and the United States, and observant of relevant sectoral regulations applicable in India including the relevant Master Circular of the Reserve Bank of India, and further noting preceding consumer case law on the subject, the Adjudicating Officer issued an order on 26.08.2013. The order found that the complainant’s right to privacy was violated by both the respondents but, while determining the quantum of compensation, distinguished between the respondents in respect of the degree of liability; the respondent wife was ordered to pay a token compensation amount while the respondent bank was ordered to pay higher compensation to each of the three complainants individually.

The high quality of each of the three orders bears specific mention. Despite the superb quality of the judgments of the Indian higher judiciary in the decades after independence, the overall quality of judgment-writing appears to have declined. [3] In the last decade, several Indian judges have called for higher standards of judgment writing from their fellow judges. [4] In this background, it is notable that Shri Rajesh Aggarwal, despite not being a member of the judiciary, has delivered well-reasoned, articulate and clear orders that are cognisant of legal issues and also easily understandable to a non-legal reader.

In each of these cases, the Adjudicating Officer has successfully navigated around the fact that none of the primary parties were interacting and transacting at arm’s length. In the Vinod Kaushik and Nirmalkumar Bagherwal matters, the primary parties were estranged but still legally married partners and in the Amit Patwardhan matter the parties were in an employer-employee relationship. The first Adjudicating Officer in the Vinod Kaushik matter failed, in his order of 09.08.2010, to appreciate that the individual communications of individual persons were privileged by an expectation of privacy, regardless of their relationship. Hence, despite acknowledging that the marital partners in that matter were in conflict with each other, and despite being told by one party that the other party’s access to those private communications was made without consent, the Adjudicating Officer allowed his non-judicial opinion of marriage to influence his order. This mistake was corrected when the matter was remanded for re-adjudication. In the re-adjudication, the new Adjudicating Officer correctly noted that the respondent wife could have chosen to approach the police or a court to follow the proper investigative procedure for accessing emails and other private communications of another person and that her unauthorised use of the complainant’s passwords amounted to a violation of their privacy.

Popular conceptions of different types of relationships may affect the (quasi) judicial imagination of privacy. In comparison to the Vinod Kaushik matter, the Nirmalkumar Bagherwal and Amit Patwardhan matters both dealt with unauthorised access to bank account statements, by a wife and by an ex-employer respectively. In any event, the same Adjudicating Officer presided over all three matters and correctly found that the facts in all three matters admitted to contraventions of the privacy of the complainants. The conjecture as to whether the first Adjudicating Officer in the Vinod Kaushik matter would have applied the same standard of family unity to unauthorised access of bank account statements by an estranged wife who was seeking maintenance remains untested. However, the reliance placed on the decision of the Delhi State Consumer Protection Commission in the matter of Rupa Mahajan Pahwa, [5] where the Commission found that unauthorised access to a bank pass book by an estranged husband violated the privacy of the wife, would suggest that judges clothe financial information with a standard of privacy higher than that given to emails.

Emails are a form of electronic communication. The PUCL case (Supreme Court of India, 1996)[6] while it did not explicitly deal with the standard of protection accorded to emails, held that personal communications were protected by an individual right to privacy that emanated from the protection of personal liberty guaranteed under Article 21 of the Constitution of India. Following the Maneka Gandhi case (Supreme Court of India, 1978)[7]

it is settled that persons may be deprived of their personal liberty only by a just, fair and reasonable procedure established by law. As a result, interceptions of private communications that are protected by Article 21 may only be conducted in pursuance of such a procedure. This procedure exists in the form of the Information Technology (Procedure and Safeguards for Interception, Monitoring and Decryption of Information) Rules, 2009 that came into effect on 27 October 2009 ("the Interception Rules"). The Interception Rules set out a regime for accessing private emails in certain conditions. The powers and procedure of Section 91 of the Code of Criminal Procedure ("CrPC") may also apply to obtain data at rest, such as emails stored in an inbox or sent-mail folder.

Finally, the orders of the Adjudicating Officer reveal a well-reasoned and progressive understanding of the law and principles relating to the quantification of compensation. By choosing to impose larger amounts of compensation on the bank that violated the privacy of the complainant in the Nirmalkumar Bagherwal matter, the Adjudicating Officer has indicated that the institutions that hold sensitive personal data, such as financial information, are subject to a higher duty of care in relation of it. But, most importantly, the act of imposing monetary compensation of privacy violations is a step forward because, for the first time in India, it recognises that privacy violations are civil wrongs or injuries that demand compensation.

[1]. These Rules were issued vide GSR 220(E), dated 17 March 2003 and published in the Gazette of India, Extraordinary, Part II, Section 3(i). These Rules can be accessed here – http://it.maharashtra.gov.in/PDF/Qual_ExpAdjudicatingOfficer_Manner_of_Holding_Enquiry_Rules.PDF (visited on 30 September 2013).

[2]. These cases and statistics may be viewed here – http://it.maharashtra.gov.in/1089/IT-Act-Judgements (visited on 30 September 2013).

[3]. See generally, Upendra Baxi “"The Fair Name of Justice": The Memorable Voyage of Chief Justice Chandrachud” in A Chandrachud Reader (Justice V. S. Deshpande ed., Delhi: Documentation Centre etc., 1985) and, Rajeev Dhavan, "Judging the Judges" in Judges and the Judicial Power: Essays in Honour of Justice V. R. Krishna Iyer (Rajeev Dhavan and Salman Khurshid eds., London: Sweet & Maxwell, 1985).

[4]. See generally, Justice B.G .Harindranath, Art of Writing Judgments (Bangalore: Karnataka Judicial Academy, 2004); Justice T .S. Sivagnanam, The Salient Features of the Art of Writing Orders and Judgments (Chennai: Tamil Nadu State Judicial Academy, 2010); and, Justice Sunil Ambwani, “Writing Judgments: Comparative Models” Presentation at the National Judicial Academy, Bhopal (2006) available here – http://districtcourtallahabad.up.nic.in/articles/writing%20judgment.pdf (visited on 29 Sep 2013).

[5]. Appeal No. FA-2008/659 of the Delhi State Consumer Protection Commission, decided on 16 October 2008.

[6]. (1997) 1 SCC 301.

[7]. (1978) 1 SCC 248.