The Centre for Internet and Society
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The National Health Stack: An Expensive, Temporary Placebo
https://cis-india.org/internet-governance/blog/bloomberg-quint-august-6-2018-murali-neelakantan-swaraj-barooah-swagam-dasgupta-torsha-sarkar-national-health-stack-an-expensive-temporary-placebo
<b>The year 2002 saw the introduction of a very ambitious National Program for Information Technology in the United Kingdom with the goal to transform the National Health Service — a pre-existing state-sponsored universal healthcare program. This would include a centralised, digital healthcare record for patients and secure access for 30,000 professionals across 300 hospitals.</b>
<blockquote class="pullquote">The article was published by <a class="external-link" href="https://www.bloombergquint.com/opinion/2018/08/06/the-national-health-stack-an-expensive-temporary-placebo#gs.HBtyGYA">Bloomberg Quint</a> on August 6, 2018.</blockquote>
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<p style="text-align: justify; ">However, the next ten years would see the scheme meet with constant criticism about its poor management and immense expenditure; and after a gruelling battle for survival, including spending £20 billion and having top experts on board, the NPfIT finally met its end in 2011.</p>
<p style="text-align: justify; ">Fast forward eight years — the Indian government’s public policy think tank, NITI Aayog, is proposing an eerily similar idea for the much less developed, and much more populated Indian healthcare sector. On July 6, the NITI Aayog released a <a href="http://niti.gov.in/writereaddata/files/document_publication/NHS-Strategy-and-Approach-Document-for-consultation.pdf" target="_blank">consultation paper</a> to discuss “a digital infrastructure built with a deep understanding of the incentive structures prevalent in the Indian healthcare ecosystem”, called the National Health Stack. The paper identifies four challenges that previous government-run healthcare programs ran into and that the current system hopes to solve. These include:</p>
<ul>
<li>low enrollment of entitled beneficiaries of health insurance,</li>
<li>low participation by service providers of health insurance,</li>
<li>poor fraud detection,</li>
<li>lack of reliable and timely data and analytics.</li>
</ul>
<p style="text-align: justify; ">The current article takes a preliminary look at the goals of the NHS and where it falls behind. Subsequent articles will break down the proposed scheme with regard to safety, privacy and data security concerns, the feasibility of data analytics and fraud detection, and finally, the role of private players within the entire structure.</p>
<p>The primary aim of any digital health infrastructure should be to compliment an existing, efficient healthcare delivery system.</p>
<blockquote>As seen in the U.K., even a very well-functioning healthcare system doesn’t necessarily mean the digitisation efforts will bear fruit.</blockquote>
<p style="text-align: justify; ">The NHS is meant to be designed for and beyond the Ayushman Bharat Yojana — the government’s two-pronged healthcare regime that was introduced on Feb. 1. Unfortunately, though, India’s healthcare regime has long been in the need of severe repair, and even if the Ayushman Bharat Yojana works optimally, there are no indications to show that this will miraculously change by their stated target of 2022. Indeed, experts predict it would take at least a ten-year period to successfully implement universal health coverage. A 2013 report by EY-FICCI stated that we must consider a ten-year time frame as well as allocating 3.5-4.7 percent of the GDP to health expenditure to achieve universal health coverage.</p>
<p>However, as per the current statistics, the centre’s allocation for health in the 2017-18 budget is Rs 47,353 crore, which is 1.15 percent of India’s GDP.</p>
<p><img src="https://cis-india.org/home-images/Patient.jpg" alt="Patient" class="image-inline" title="Patient" /></p>
<p>Patients wait for treatment in the corridor of the Acharya Tulsi Regional Cancer Treatment & Research Institute in Bikaner, Rajasthan, India. (Photographer: Prashanth Vishwanathan/Bloomberg)</p>
<p style="text-align: justify; ">Along with the state costs, India’s current expenditure in the health sector comes to a meagre 1.4 percent of the total GDP, far short of what the target should be. Yet, the government aims to attain universal health coverage by 2022.</p>
<p>In the first of its two-pronged strategy, the Ayushman Bharat Yojana aims to establish 1.5 lakh ‘Health and Wellness Centres’ across the country by 2022, which would provide primary healthcare services free of cost.</p>
<blockquote>However, the total fund allocated for ’setting up’ these centres is only Rs 1,200 crore, which comes down to a meagre Rs 80,000 per centre.</blockquote>
<p style="text-align: justify; ">It is unclear whether the government plans to establish new sub-centres, or improve the existing ones. Either way, a pittance of Rs 80,000 is grossly insufficient. As per reports, among the 1,56,231 current health centres, only 17,204 (11 percent) have met Indian Public Health Standards as of March 31, 2017. Shockingly, basic amenities like water and electricity are scarce, if not, absent in a substantial number of these centres.</p>
<p>At least 6,000 centres do not have a female health worker, and at least 1,00,000 centres do not have a male health worker.</p>
<p><img src="https://cis-india.org/home-images/Woman.jpg" alt="Woma" class="image-inline" title="Woma" /></p>
<p>A woman holds a child in the post-delivery ward of the district hospital in Jind, Haryana, India. (Photographer: Prashanth Vishwanathan/Bloomberg)</p>
<p>Even taking the generous assumption that the existing 17,204 centres are in top condition, the future of the rest of these health and wellness centres continues to be bleak.</p>
<p style="text-align: justify; ">In truth, both limbs of the Ayushman Bharat strategy remain oblivious to the reality of the situation. The goals do not take into account the existing problems within access to healthcare, nor the relevant economic and social indicators that depict a contrasting reality.</p>
<blockquote>Therefore, the fundamental question remains: if there is no established, well-functioning healthcare delivery system to support, what will the NHS help?</blockquote>
<p><img src="https://cis-india.org/home-images/BitterPill.jpg" alt="Bitter Pill" class="image-inline" title="Bitter Pill" /></p>
<h3>NHS: What Purpose Does It Serve?</h3>
<p style="text-align: justify; ">The ambitious scope of the National Health Stack consultation paper aside, the central problem plaguing the Indian healthcare system, i.e, delivery, and access to healthcare, remains unaddressed. The first two problems that the NHS aims to solve focus solely on increasing health insurance coverage. However, very problematically, the document does not explicitly mention how a digital infrastructure would lead to rising enrollment of both beneficiaries and service providers of insurance.</p>
<p>This goal of increasing enrollment without a functioning healthcare system could result in two highly problematic scenarios.</p>
<blockquote>Either health and wellness centres will effectively act as enrollment agencies rather than providers of healthcare, or the government would fall back on its ‘Aadhar approach’ and employ external enrollment agents.</blockquote>
<p style="text-align: justify; ">The former approach runs a very real risk of the health and wellness centres losing focus on their primary purpose even while statistics show them as functioning centres – thus negatively impacting even the working centres. The latter approach is at a higher risk of running into problems akin to the case of Aadhaar enrollment, such as potential data leakages, identity thefts and a market for fake IDs. Even if we somehow overlook this and assume that the NHS would help increase insurance coverage without additional problems, the larger question still stands: should health insurance even be the primary goal of the government, over and above providing access to healthcare? And what effect will this have on the actual delivery of healthcare services to the common citizen?</p>
<p><img src="https://cis-india.org/home-images/LonePatient.jpg" alt="Lone Patient" class="image-inline" title="Lone Patient" /></p>
<p>A lone patient sleeps in the post operation recovery ward of the district hospital in Jind, Haryana, India. (Photographer: Prashanth Vishwanathan/Bloomberg)</p>
<h3>Should Insurance Be A Primary Objective Of The Indian Government?</h3>
<p style="text-align: justify; ">Simply put, the answer is no, because greater insurance coverage need not necessitate better access to healthcare. In recent years, health insurance in India has been rising rapidly due to government-sponsored schemes. In the fiscal year 2016-17, the health insurance market was prized to be worth Rs 30,392 crore. Even with such large investments in insurance premiums, the insurance market accounts for lesser than 5 percent of the total health expenditure.</p>
<blockquote>Furthermore, previous experiences with government-sponsored health insurance schemes have proven that there is little merit to such an expensive task.</blockquote>
<p style="text-align: justify; ">For instance, the government’s earlier health insurance scheme, Rashtriya Swasthya Bima Yojana, was predicted to be unable to completely provide ‘accessible, affordable, accountable and good quality health care’ if it focussed only on “increasing financial means and freedom of choice in a top-down manner”.</p>
<p style="text-align: justify; ">These traditional insurance-based models are characterised by problems of information asymmetry such as ‘moral hazard’ — patients and healthcare providers have no incentive to control their costs and tend to overuse, resulting in an unsustainable insurance system and cost inflation. Any attempt to regulate providers is met with harsh, cost-cutting steps which end up harming patients.</p>
<p style="text-align: justify; ">On another note, some diseases which are responsible for the most number of deaths in the country — including ischaemic heart diseases, lower respiratory tract infections, chronic obstructive pulmonary disease, tuberculosis and diarrhoeal diseases — are usually chronic conditions that need outpatient consultation, resulting in out-of-pocket expenses.</p>
<p><img src="https://cis-india.org/home-images/CancerHospital.jpg" alt="Cancer Hospital" class="image-inline" title="Cancer Hospital" /></p>
<p>Patients wait at the Head and Neck Cancer Out Patient department of Tata Memorial Hospital in Mumbai, India. (Photographer: Prashanth Vishwanathan/Bloomberg News)</p>
<p style="text-align: justify; ">Even though the government has added non-communicable diseases under the ambit of the health and wellness centres, there are still reports stating that for some of the most impoverished, their reality is that 80 percent of the time, they have to cover their expenses from their pocket. This issue in all probability will continue to exist since the status and likelihood for these centres to be successful itself is questionable.</p>
<blockquote>It is clear, that in the current scheme of things, this traditional insurance model of healthcare cannot benefit those it is meant for.</blockquote>
<p style="text-align: justify; ">If this is the case, why has the NHS built its main objectives around insurance coverage rather than access to healthcare? It is imperative that we question the legitimacy of these goals, especially if they indicate the government's intentions to push health insurance via the NHS above its responsibility of delivering healthcare. The government's thrust for a digital infrastructure shows tremendous foresight, but at what cost? Even the clear goal of healthcare data portability has very little benefit when one understands that this becomes an important goal only when one has given up on ensuring widespread accessible healthcare. Once the focus shifts from using technology needlessly to developing an efficient and universally accessible healthcare delivery system, the need for data portability dramatically reduces. The temptation of digitisation and insurance coverage cannot and should not blind us from the main goal — access to healthcare. The one lesson that we must learn from the case of the U.K. is that even with a well-functioning healthcare delivery system, a digital infrastructure must be introduced very thoughtfully and carefully. In our eagerness to leapfrog with technology, we must not mistake a placebo for a panacea.</p>
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<p><i>Murali Neelakantan is an expert in healthcare laws. Swaraj Barooah is Policy Director at The Centre for Internet and Society. Swagam Dasgupta and Torsha Sarkar are interns at The Centre for Internet and Society.</i></p>
<p>
For more details visit <a href='https://cis-india.org/internet-governance/blog/bloomberg-quint-august-6-2018-murali-neelakantan-swaraj-barooah-swagam-dasgupta-torsha-sarkar-national-health-stack-an-expensive-temporary-placebo'>https://cis-india.org/internet-governance/blog/bloomberg-quint-august-6-2018-murali-neelakantan-swaraj-barooah-swagam-dasgupta-torsha-sarkar-national-health-stack-an-expensive-temporary-placebo</a>
</p>
No publisherMurali Neelakantan, Swaraj Barooah, Swagam Dasgupta, and Torsha SarkarInternet GovernanceInformation Technology2018-08-13T15:13:10ZBlog EntryThe Quixotic Fight to Clean up the Web
https://cis-india.org/internet-governance/quixotic-fight-to-clean-the-web
<b>The ongoing attempt to pre-screen online content won’t change anything. It will only drive netizens into the arms of criminals, writes Sunil Abraham in this article published in Tehelka Magazine, Vol 9, Issue 04, Dated 28 Jan 2012.</b>
<p>GOOGLE AND Facebook’s ongoing case in the Delhi High Court over offensive online content is curious in three ways. First, the complaint does not mention the IT Act, 2000. Prior to the 2008 amendment, intermediaries (in this case, Google, Facebook, etc) had no immunity. But after the amendment, intermediaries have significant immunity and are not considered liable unless takedown notices are ignored.</p>
<p>Second, it is curious that the complaint does not mention specific individuals or groups directly responsible for authoring the allegedly offensive material. Only intermediaries have been explicitly named. If specific content items have been submitted in court then it is curious that specific accounts and users have not been charged with the same offences.</p>
<p>Three, Delhi-based journalist Vinay Rai claims that takedown notices and requests for user information were ignored by the intermediaries. As yet, unpublished research at the Centre for Internet and Society has reached the exact opposite conclusion. We sent fraudulent takedown notices to seven of the largest intermediaries in India as part of a policy sting operation. Six of them over-complied and demonstrated no interest in protecting freedom of expression. Our takedown notices were complied with even though they were largely nonsensical. It is therefore curious that Rai’s takedown notices were ignored.<br /><br />Under Section 79 of the IT Act, the intermediary must not “initiate the transmission”, “select the receiver of the transmission” and “select or modify the information contained in the transmission”. In other words, they must not possess “actual knowledge” of the content. This would be absolutely true if intermediaries acted as “dumb pipes” or “mere conduits”. But today, they have reactive “human filters” ensuring conformance to community guidelines that often go beyond constitutional limits on freedom of expression.<br /><br />For example, Facebook deletes breastfeeding photographs if a certain proportion of the breast is visible, despite numerous protests. Intermediaries also use proactive “machine filters” to purge their networks of pornography and copyright infringing content. In order to retain immunity under the IT Act, intermediaries would have to demonstrate that they have no “actual knowledge”. This would also imply that they cannot proactively filter or pre-screen content without becoming liable for illegal content.</p>
<p>More sophisticated “machine filters” will continue to be built for social media platforms as computing speeds increase and costs decrease dramatically. But there will be significant collateral damage — the vibrancy of online Indian communities will be diminished as legitimate content will be removed and this in turn will retard Internet adoption rates. Free media, democratic governance, research and development, culture and the arts will all be fundamentally undermined. So whether pre-censorship is technically feasible is an irrelevant question. The real question is what limits on freedom of expression are reasonable in the Internet age.</p>
<div class="pullquote">The legal tussle is yet another chance for reflecting on the shortcomings of the IT Act</div>
<p>Censorship is like prohibition, illegal content will persist, the mafia will profit and ordinary citizens will be implicated in criminal networks. Use of anonymising proxies, circumvention tools and encryption technologies will proliferate, frustrating network optimisation efforts and law enforcement activities.</p>
<p>This is yet another opportunity for reflecting on the shortcomings of the ITAct. A lot of the confusion and anxiety today emerges from vague language, unconstitutional limits on freedom of expression, multi-tiered blanket surveillance provisions, blunt security policy measures contained in the statute and its associated rules. The next Parliament session is the last opportunity for MPs to ask for the rules for intermediaries, cyber cafes and reasonable security practices to be revisited. The MP who musters the courage to speak will be dubbed a superhero.<br /><br />As told to Shonali Ghosal. Sunil Abraham is Executive director, centre for internet and society and can be contacted at <a class="external-link" href="mailto:sunil@cis-india.org">sunil@cis-india.org</a>. <a class="external-link" href="http://www.tehelka.com/story_main51.asp?filename=Op280112proscons.asp">The original article was published in Tehelka</a>.</p>
<p>Illustration by Sudeep Chaudhuri</p>
<p>
For more details visit <a href='https://cis-india.org/internet-governance/quixotic-fight-to-clean-the-web'>https://cis-india.org/internet-governance/quixotic-fight-to-clean-the-web</a>
</p>
No publishersunilFreedom of Speech and ExpressionPublic AccountabilityInternet GovernanceInformation Technology2012-01-26T20:53:02ZBlog EntryIT (Amendment) Act, 2008, 69B Rules: Draft and Final Version Comparison
https://cis-india.org/internet-governance/blog/it-amendment-act-69-b-draft-and-final-version-comparison
<b>Jadine Lannon has performed a clause-by-clause comparison of the Draft 69B Rules and official 69B Rules under Section 69B in order to better understand how the two are similar and how they differ. Notes have been included on some changes we deemed to be important.</b>
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<p style="text-align: justify; ">There has been a considerable amount of re-arrangement and re-structuring of the various clauses between the 69B Draft Rules and the official Rules, as can be seen in the comparison chart, but very little content has been changed. The majority of the changes made to the official Rules are changes in wording and language that serve to provide some much-needed clarification to the Draft Rules (see the differences between Clause (9) of the Draft Rules and sub-section (4) of Clause (3) of the official Rules as an example). Language redundancies, as well as full clauses (Clause [6] of the Draft Rules) have been thankfully removed in the official Rules.</p>
<p style="text-align: justify; ">Aside from the addition of four definitions, including a definition for a “security policy”, a phrase which appears in the Draft Rules without being defined, Clause (2) contains what is most likely one of the more noteable changes between the two definitions: under sub-section (g) in the 69 Rules, the words “or unauthorised use” have been added to the definition of “cyber security breaches”, which significantly increases the scope of what can be considered a cyber security breach under the Rules.</p>
<p style="text-align: justify; ">A significant change between the two sets of rules can be found in sub-section (2) of Clause (8) of the official rules, which states that, “<i>save as otherwise required for the purpose of any ongoing investigation, criminal complaint or legal proceedings </i>the intermediary or the person in-charge of computer resource shall destroy records pertaining to directions for monitoring or collection of information”. The section in italics has been added to the original Clause (22) of the Draft Rules, meaning that when the Rules were originally drawn up, no exceptions were to be made for the destructions of the records for the issuing of directions for monitoring and/or the collected information. They would simply have to be destroyed within six months of the discontinuance of the monitoring/collection.</p>
<p style="text-align: justify; ">One change that may or may not be significant is the replacement of the words “established violations” in the Draft Rules to simply “violation” in the official Rules in Clauses (19)/(6), which deal with the responsibility of the intermediary. This could be taken to mean that suspected and/or perceived violations may also be punishable under this clause, but this is a hard stance to argue. Most likely the adjustment was made when those superfluous and/or convoluted parts of the Draft rules were being removed.</p>
<p>
For more details visit <a href='https://cis-india.org/internet-governance/blog/it-amendment-act-69-b-draft-and-final-version-comparison'>https://cis-india.org/internet-governance/blog/it-amendment-act-69-b-draft-and-final-version-comparison</a>
</p>
No publisherjdineInternet GovernanceInformation Technology2013-04-30T09:47:46ZBlog EntryImpact of Industrial Revolution 4.0 - IT and Automotive Sector in India by the Dialogue and FES
https://cis-india.org/internet-governance/news/impact-of-industrial-revolution-4-0-it-and-automotive-sector-in-india-by-the-dialogue-and-fes
<b>On August 21, 2019, Aayush Rathi, attended a report launch event and focus group discussion on the "Impact of Industrial Revolution 4.0 - IT and Automotive Sector in India". Research conducted by the Dialogue in collaboration with the Friedrich-Ebert-Stiftung (FES) were being presented. </b>
<p class="moz-quote-pre" style="text-align: justify; ">At CIS, we have previously produced research on the future of work in these sectors. Aayush attended the event to understand how other researchers are approaching the subject of the future of work in terms of the methodological approach and the questions being asked and policy responses being proposed. In what may be treated as validation of our research design, FES and the Dialogue have addressed similar questions and adopted an empirical+desk based approach to do so as well.</p>
<p>
For more details visit <a href='https://cis-india.org/internet-governance/news/impact-of-industrial-revolution-4-0-it-and-automotive-sector-in-india-by-the-dialogue-and-fes'>https://cis-india.org/internet-governance/news/impact-of-industrial-revolution-4-0-it-and-automotive-sector-in-india-by-the-dialogue-and-fes</a>
</p>
No publisherAdminIndustry 4.0Internet GovernanceInformation TechnologyArtificial Intelligence2019-08-27T00:13:32ZNews ItemFuture of Work in the ASEAN
https://cis-india.org/internet-governance/blog/future-of-work-in-the-asean
<b>A literature review of the future of work in automotive manufacturing and IT services in the ASEAN region, authored by Aayush Rathi, Vedika Pareek, Divij Joshi, and Pranav M B.</b>
<p> </p>
<h4>Read the research paper: <a href="https://cis-india.org/internet-governance/pdf-asean-literature-review" class="internal-link" title="PDF ASEAN Literature Review">Download</a> (PDF)</h4>
<p>Authored by Aayush Rathi, Vedika Pareek, Divij Joshi, and Pranav Bidare</p>
<p>Research assistance by Sankalp Srivastava and Anjanaa Aravindan</p>
<p>Edited by Elonnai Hickok and Ambika Tandon</p>
<p>Supported by Tides Foundation</p>
<hr />
<h2>Introduction</h2>
<p style="text-align: justify;">The world of work, and its future, have attracted a lot of attention in recent times. The discussion has been provoked by the confluence of recent technological breakthroughs that portend to have wide-ranging implications on work and livelihoods. In what has been termed the “Fourth Industrial Revolution” or “Industry 4.0” , the discussion has engaged numerous stakeholders. However, no shared understanding of what this future of work will look like has materialised. Historical scholarship around technological change and its impact on the labour market was focussed in the context of high-income countries. Contemporaneously, however, research is being produced that outlines the possible futures of work in low and middle-income contexts. It is exigent to generate scholarship dedicated to low and middle-income contexts given that in addition to technological drivers, the future of work will be mediated through region and country specific factors such as socioeconomic,geopolitical and demographic change.</p>
<p> </p>
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For more details visit <a href='https://cis-india.org/internet-governance/blog/future-of-work-in-the-asean'>https://cis-india.org/internet-governance/blog/future-of-work-in-the-asean</a>
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No publisheraayushFuture of WorkInternet GovernanceAutomotive ManufacturingInformation Technology2020-03-05T19:22:50ZBlog EntryParticipation in the meeting of LITD 17 at BIS
https://cis-india.org/internet-governance/news/participation-in-the-meeting-of-litd-17-at-bis
<b>On September 25, 2019, Gurshabad Grover along with Elonnai Hickok and Karan Saini attended the meeting of the Information Systems Security & Privacy Sectional Committee (LITD17) of the Bureau of Indian Standards (BIS).</b>
<p>Some agenda points:</p>
<div id="_mcePaste" style="text-align: justify; ">
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<li>Elonnai, Karan and Gurshabad had submitted comments on two standards related to infomration security of biometrics systems: (i) ISO/IEC 24745: 2011 <span>Information Technology – Security techniques – Biometric information protection; (ii) Doc. No. LITD 17 (3595) ISO/IEC 19792: 2009 Information </span><span>Technology – Security techniques – Security evaluation of biometrics. Gurshabad Grover is now serving in a panel with BIS and MeitY representatives to discuss </span><span>how the standards compare to UIDAI's standards and governing regulations.</span></li>
<li><span>Gurshabad </span>updated the committee with my plan of participation at the ISO/IEC JTC 1 SC 27 meetings (which were held earlier this month in Paris).</li>
<li>Gurshabad will be joining a panel to discuss and further develop a draft mobile phone security standard for India.</li>
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<p>
For more details visit <a href='https://cis-india.org/internet-governance/news/participation-in-the-meeting-of-litd-17-at-bis'>https://cis-india.org/internet-governance/news/participation-in-the-meeting-of-litd-17-at-bis</a>
</p>
No publisherAdminInternet GovernanceInformation Technology2019-11-02T06:30:29ZNews ItemInformation security policy on govt agenda
https://cis-india.org/news/live-mint-politics-surabhi-agarwal-nov-6-2012-information-security-policy-on-govt-agenda
<b>As an increasing quantity of sensitive information is transmitted through electronic channels, the government is considering putting in place an internal information security policy to reduce the risk of leaks and counter possible cyber attacks, said three government officials involved in discussions on the proposal.</b>
<hr />
<p>Surabhi Agarwal's article was <a class="external-link" href="http://www.livemint.com/Politics/TyFgDxthlTap5XwzA84gdO/Information-security-policy-on-govt-agenda.html">published</a> in LiveMint on November 6, 2012. Sunil Abraham is quoted.</p>
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<p style="text-align: justify; ">The policy will include new guidelines on top of the standards set out by the Official Secrets Act, 1923, and mandate safeguards for each category of information on how it should be transmitted, stored and preserved. The categories are “top secret”, “secret”, “confidential”, “restricted” and “official use only”.</p>
<p style="text-align: justify; ">Experts argue that given the easy portability of such information and its vulnerability to hackers, the policy should have been in place much sooner.</p>
<p style="text-align: justify; ">The Official Secrets Act seeks to protect sensitive information including official communications, sketch plans, documents and other information pertaining to government functioning. Gaining wrongful access to information deemed to be an official secret or unauthorized use of such information are regarded as offences.</p>
<p style="text-align: justify; ">Given that the law was enacted almost a quarter century before independence, it had no provisions to deal with electronic transmission of such information made possible by technological advances in subsequent decades, said cyber expert <a href="http://www.livemint.com/Search/Link/Keyword/Pawan%20Duggal">Pawan Duggal</a>.</p>
<p style="text-align: justify; ">One of the three government officials cited above said the aim of the proposed internal information security policy is to protect classified information that’s transmitted electronically much as it is done currently in the paper format.</p>
<p style="text-align: justify; ">"As more information is getting transmitted in the electronic format, we have to put in place procedures, guidelines, policies and standards for protecting that information in the electronic format," the official said.</p>
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<p><iframe frameborder="0" height="315" src="http://www.youtube.com/embed/mbEt4qd0fnA" width="320"></iframe><br /><br />From the newsroom: Securing government information</p>
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<p style="text-align: justify; ">The discussions, being anchored by the home ministry, have been under way for some time and the policy should be finalized in the “next few months”, the official said.</p>
<p style="text-align: justify; ">A second official said the policy will lay down the dos and don’ts for government officers on how information has to be transmitted, stored and preserved in the electronic format. “In case of a breach, the investigation agencies can then look into whether the requisite safeguards were followed or not,” the official said. The proposal follows a rash of attacks on government computer systems that exposed their vulnerability to hackers.</p>
<p style="text-align: justify; ">Former minister of state for communications and information technology <a href="http://www.livemint.com/Search/Link/Keyword/Sachin%20Pilot">Sachin Pilot</a> told Parliament recently that between December 2011 and February 2012, a total of 112 government websites had been hacked.</p>
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<p style="text-align: justify; ">A third government official, who also didn’t want to be identified, said that every government official would have to follow standard procedures in electronic transmission of information.</p>
<p style="text-align: justify; ">“The moment one’s computer is connected to the Internet, it is part of a global network, so attackers in the cyber space know which information can be stolen from where if the necessary deterrents are not in place,” the official said.</p>
<p style="text-align: justify; ">Sensitive information such as tax matters and intellectual property issues are part of the information that’s transmitted electronically by government offices, which if leaked can have market implications as well as an impact on governance, experts said.</p>
<p style="text-align: justify; ">“The government leaks like a sieve,” said <a href="http://www.livemint.com/Search/Link/Keyword/B.G.%20Verghese">B.G. Verghese</a>, a visiting professor at New Delhi-based Centre for Policy Research.</p>
<p style="text-align: justify; ">“This is a step and they are trying to lay some ground rules to regulate a process that fits in with concepts of law, good governance, Constitution, privacy and prevents any wrongdoing,” Verghese said.</p>
<p style="text-align: justify; ">The proposed policy, when put in place, will be a step forward so long as it does not dilute the powers available to citizens under the Right to Information Act, said <a href="http://www.livemint.com/Search/Link/Keyword/Sunil%20Abraham">Sunil Abraham</a>, executive director of Bangalore-based research organization Centre for Internet and Society.</p>
<p style="text-align: justify; ">Currently there are several concerns centred on electronic transmission, including questions about who is responsible for information, especially its unauthorized use. “This could help establish an audit trail,” Abraham said.</p>
<p style="text-align: justify; ">The first government official quoted above stressed that although cyber security and information security cut across each other, the two concepts are different.</p>
<p style="text-align: justify; ">“Cyber (security) is basically about devices and networks, whereas information security is very particularly about the information which travels on the net,” this official said. Reinforced cyber security will be an additional benefit once the information security policy comes into force, he said.</p>
<p>
For more details visit <a href='https://cis-india.org/news/live-mint-politics-surabhi-agarwal-nov-6-2012-information-security-policy-on-govt-agenda'>https://cis-india.org/news/live-mint-politics-surabhi-agarwal-nov-6-2012-information-security-policy-on-govt-agenda</a>
</p>
No publisherpraskrishnaInternet GovernanceInformation Technology2012-11-08T06:18:28ZNews ItemIT (Amendment) Act, 2008, 69 Rules: Draft and Final Version Comparison
https://cis-india.org/internet-governance/blog/it-amendment-act-69-rules-draft-and-final-version-comparison
<b>Jadine Lannon has performed a clause-by-clause comparison of the Draft 69 Rules and official 69 Rules under Section 69B in order to better understand how the two are similar and how they differ. Very brief notes have been included on some changes we deemed to be important.
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<p style="text-align: justify; ">Similar to the other comparisons that I have done on the 69A and 69B Draft and official Rules, the majority of the changes between these two sets of rules serves to restructure and clarify various clauses in the Draft 69 Rules.</p>
<p style="text-align: justify; ">Three new definitions appear in the Clause (2) of the 69 Rules, including a definition for “communication”, which appears in the Draft Rules but has no associated definition under Clause (2) of the Draft Rules.</p>
<p style="text-align: justify; ">Clause (31) of the Draft Rules, which deals with the requirement of security agencies of the State and Union territories to share any information gathered through interception, monitoring and/or decryption with federal agencies, does not make an appearance in the official rules. Further, this necessity does not seem to be implied anywhere in the official 69 Rules.</p>
<p>
For more details visit <a href='https://cis-india.org/internet-governance/blog/it-amendment-act-69-rules-draft-and-final-version-comparison'>https://cis-india.org/internet-governance/blog/it-amendment-act-69-rules-draft-and-final-version-comparison</a>
</p>
No publisherjdineInternet GovernanceIntermediary LiabilityInformation Technology2013-04-30T09:56:07ZBlog EntryGNI and IAMAI Launch Interactive Slideshow Exploring Impact of India's Internet Laws
https://cis-india.org/internet-governance/blog/gni-and-iamai-launch-interactive-slideshow-exploring-impact-of-indias-internet-laws
<b>The Global Network Initiative and the Internet and Mobile Association of India have come together to explain how India’s Internet and technology laws impact economic innovation and freedom of expression. </b>
<p>The <a class="external-link" href="http://www.globalnetworkinitiative.org/">Global Network Initiative (GNI)</a>, and the <a class="external-link" href="http://www.iamai.in/">Internet and Mobile Association of India (IAMAI)</a> have launched an interactive slide show exploring the impact of existing Internet laws on users and businesses in India. The slide show created by Newsbound, and to which Centre for Internet and Society (CIS) has contributed its comments—explain the existing legislative mechanisms prevalent in India, map the challenges of the regulatory environment and highlight areas where such mechanisms can be strengthened.</p>
<p>Foregrounding the difficulties of content regulation, the slides are aimed at informing users and the public of the constraints of current legal mechanisms in place, including safe harbour and take down and notice provisions. Highlighting Section 79(3) and the Intermediary Liability Rules issued in 2011, the slide show identifies some of the challenges faced by Internet platforms, such as the broad interpretation of the legislation by the executive branch.</p>
<p>Challenges governing Internet platforms highlighted in the slide show include uniform Terms of Service that do not consider the type of service being provided by the platform, uncertain requirements for taking down content and compliance obligations related to information disclosure. Further the issues of over compliance and misuse of the legal notice and take down system introduced under Section 79 of the Information Technology (Intermediaries Guidelines) Rules 2011.</p>
<p>The Rules were created with the purpose of providing guidelines for the ‘post-publication redressal mechanism expression as envisioned in the Constitution of India'. However, since their introduction, the Rules have been criticised extensively, by both the national and the international media on account of not conforming to principles of natural justice and freedom of expression. Critics have pointed out that by not recognising the different functions performed by the different intermediaries and by not providing safeguards against misuse of such mechanism for suppressing legitimate expression, the Rules have a chilling effect on freedom of expression.</p>
<p>Under the current Rules, the third party provider/creator of information is not given a chance to be heard by the intermediary, nor is there a requirement to give a reasoned decision by the intermediary to the creator whose content has been taken down. The take down procedure also, does not have any provisions for restoring the removed information, such as providing a counter notice filing mechanism or appealing to a higher authority. Further, the content criteria for removal of content includes terms like 'disparaging' and 'objectionable', which are not defined and prima facie seem to be beyond the reasonable restrictions envisioned by the Constitution of India. With uncertainty in content criteria and no safeguards to prevent abuse complainant may send frivolous complaints and suppress legitimate expressions without any fear of repercussions.</p>
<p>Most importantly, the redressal mechanism under the Rules shifts the burden of censorship, previously, the exclusive domain of the judiciary or the executive, and makes it the responsibility of private intermediaries. Often, private intermediaries, do not have sufficient legal resources to subjectively determine the legitimacy of a legal claim, resulting in over compliance to limit liability. The slide show cites the <a href="https://cis-india.org/internet-governance/chilling-effects-on-free-expression-on-internet">2011 CIS research carried out by Rishabh Dara</a> to determine whether the Rules lead to a chilling effect on online free expression, towards highlighting the issue of over compliance and self censorship.</p>
<p>The initiative is timely, given the change of guard in India, and stresses, not only the economic impact of fixing the Internet legal framework, but also the larger impact on users rights and freedom of expression. The initiative calls for a legal environment for the Internet that enables innovation, protects the rights of users, and provides clear rules and regulations for businesses large and small.</p>
<p>See the slideshow here: <a href="http://globalnetworkinitiative.org/india">How India’s Internet Laws Can Help Propel the Country Forward</a></p>
<p><strong>Other GNI reports and resources: </strong></p>
<p><a href="http://www.globalnetworkinitiative.org/sites/default/files/Closing%20the%20Gap%20-%20Copenhagen%20Economics_March%202014_0.pdf">Closing the Gap: Indian Online Intermediaries and a Liability System Not Yet Fit for Purpose</a></p>
<p><a href="http://www.globalnetworkinitiative.org/sites/default/files/Closing%20the%20Gap%20-%20Copenhagen%20Economics_March%202014_0.pdf">Strengthening Protections for Online Platforms Could Add Billions to India’s GDP</a></p>
<p>
For more details visit <a href='https://cis-india.org/internet-governance/blog/gni-and-iamai-launch-interactive-slideshow-exploring-impact-of-indias-internet-laws'>https://cis-india.org/internet-governance/blog/gni-and-iamai-launch-interactive-slideshow-exploring-impact-of-indias-internet-laws</a>
</p>
No publisherjyotiCensorshipFreedom of Speech and ExpressionInternet GovernanceIntermediary LiabilityChilling EffectInformation Technology2014-07-17T12:01:01ZBlog EntryLeveraging Web Application Vulnerabilities for Reconnaissance and Intelligence Gathering
https://cis-india.org/internet-governance/news/leveraging-web-application-vulnerabilities-for-reconnaissance-and-intelligence-gathering
<b>Karan Saini gave a talk at the JSFoo Conference at the GRD College of Science in Coimbatore, Tamil Nadu on July 5, 2019. The event was organized by Has Geek.</b>
<p>Click to <a class="external-link" href="http://cis-india.org/internet-governance/files/jsfoo-talk">view Karan's presentation</a></p>
<p>
For more details visit <a href='https://cis-india.org/internet-governance/news/leveraging-web-application-vulnerabilities-for-reconnaissance-and-intelligence-gathering'>https://cis-india.org/internet-governance/news/leveraging-web-application-vulnerabilities-for-reconnaissance-and-intelligence-gathering</a>
</p>
No publisherAdminInternet GovernanceInformation Technology2019-07-22T01:39:14ZNews ItemPolicy Shaping in the Indian IT Industry: Recommendations by NASSCOM, 2006-2012
https://cis-india.org/raw/policy-shaping-in-the-indian-it-industry-recommendations-by-nasscom-2006-2012
<b>This is the first of a series of three blog posts, authored by Pavishka Mittal, tracking the engagements by NASSCOM and iSPIRT in suggesting and shaping the IT industry policies in India during 2006-2016. This posts focuses on the policy activities of NASSCOM in 2006-2012 with specific reference to Special Economic Zones, E-Commerce Industry and Transfer Pricing, along with a few other miscellaneous important recommendations.</b>
<p> </p>
<p><strong>1.</strong> <a href="#1">Introduction</a></p>
<p><strong>2.</strong> <a href="#2">Tax Reforms in Special Economic Zones (SEZs)</a></p>
<p><strong>3.</strong> <a href="#3">E-Commerce Industry</a></p>
<p><strong>4.</strong> <a href="#4">Transfer Pricing Issues</a></p>
<p><strong>5.</strong> <a href="#5">Other Recommendations</a></p>
<p><strong>5.1.</strong> <a href="#5-1">Concerns with the Union Budget Proposals</a></p>
<p><strong>5.2.</strong> <a href="#5-2">Request for Clarity in Classification of Transactions and Guidelines</a></p>
<p><strong>5.3.</strong> <a href="#5-3">New Retrograde Obligations under Law</a></p>
<p><strong>6.</strong> <a href="#6">Endnotes</a></p>
<p><strong>7.</strong> <a href="#7">Author Profile</a></p>
<hr />
<h2 id="1">1. Introduction</h2>
<p>The National Association of Software and Services Companies (NASSCOM) was established in 1988 as a non-profit, global trade association registered under the Indian Societies Act 1860 representing the interests of the IT Industry, now with over 1500 members. Its objective is to facilitate trade in the software development and services, software products, IT enabled/BPO services and e-commerce. It also undertakes research projects for facilitating innovation in advanced software and maintains data on industry trends, even a national database of registered and verified knowledge workers in the industry. Nevertheless, its role of policy advocacy cannot be over emphasized. It regularly interacts with the Government of India to bring about a favourable business environment for the IT Industry.</p>
<p>This blog post, the first part in a series, discusses NASSCOM’s major issues with policies of the Government of India in the period 2006-2012. The concerns of the IT industry, as highlighted by NASSCOM in the period aforementioned are with reference to the Special Economic Zones, E-Commerce Industry and Transfer Pricing broadly along with other miscellaneous important recommendations. The subsequent blog posts will focus on specific tax issues post 2012 and will elaborately discuss transfer pricing related concerns.</p>
<h2 id="2">2. Tax Reforms in Special Economic Zones (SEZs)</h2>
<p>The ITes and BPO industry constitutes a sizable portion of the number of SEZs in the country <strong>[1]</strong> so much so that it has been argued that the IT industry alone reaps the benefits of the SEZs and STPIs to the exclusion of the other sectors <strong>[2]</strong>.</p>
<p>The most salient incentive in the SEZ Act enacted by the Government of India in 2005 had been income tax exemption of export profits which contributed to the scheme’s success in attracting major investments <strong>[3]</strong>. Further, exemption from minimum alternate tax had been provided under section 115JB of the Income Tax Act. However, in 2011, the government decided to impose a Minimum Alternate Tax upto the rate of 18.5% on the book profits of SEZ’s developers and units through the Finance Act 2012 by introducing amendments to the Income Tax Act 1961, to be effective from April 2012 <strong>[4]</strong>. NASSCOM took a strong stance against equality in corporate tax liability as such tax is sought to be imposed upon income derived from investments made with a commitment of tax exemption. The intention of the government in making such policies having regressive outcomes will be judged if key promised characteristics of SEZs were differential economic laws from the remaining domestic territory. For all practical purposes, they are deemed to be foreign territories for the levy of trade duties and tariffs <strong>[5]</strong>. In the case of Mindtree Limited v. Union of India <strong>[6]</strong>, software company Mindtree argued that the imposition of MAT in SEZs was against the concept of promissory estoppel and the doctrine of legitimate expectation, which rendered such taxes constitutionally invalid <strong>[7]</strong>. Even though a time limit was not prescribed for the above tax exemption, it was argued that SEZ policy was predicated on tax relief and the subsequent change in policy was arbitrary and unfair. Individual taxpayers and undertakings should not be affected by subsequent laws if they make sizable investments, modify business models and bear the added expenses of moving into or developing a SEZ. It cannot be disputed that this argument is untenable keeping in mind that the legislature cannot be bound by past promises in line with practical considerations and their independence with regard to the effective discharge of public functions. It was held that the legislature cannot be bound by the doctrine of promissory estoppel <strong>[8]</strong>.</p>
<p>The Adani group had also challenged the imposition of MAT in the Gujarat HC in 2011 on the ground that that any amendments to the SEZ Act can only be brought about by amendments to the SEZ Act itself, and not through the Finance Act <strong>[9]</strong>. The SC in Madurai District Central Cooperative Bank Ltd. <strong>[10]</strong> held that the parliament has the authority to introduce a new charge of tax even by incorporating it in any other statute other than the act. However, the fact remains that such policies lead to a volatile business environment and the importance of stable business policies cannot be overemphasized. In 2011, NASSCOM recommended that MAT be withdrawn as it is opposed to the government’s long term policy of SEZ’s growth <strong>[11]</strong>. Alternatively, it stated that the imposition of MAT be withdrawn to ensure the continued economic viability of the SEZs which have already been notified by the government <strong>[12]</strong>. It also stated that international norms should be applied for the determination of the MAT rate, which was 1/3rd of the corporate tax rates <strong>[13]</strong>.</p>
<p>Another concern highlighted by other stakeholders was the prescribed period of ten years for the setting of the MAT against regular tax liability. This MAT credit may expire or be on the verge of expiration for participants in SEZs who enjoy tax holiday for a prescribed number of years when they start operations due to absence of initial tax liability. Foreign investors will face difficulties in claiming tax benefits in their home jurisdictions for MAT paid in India. Further, the exemption granted to SEZ developers as to the levy of Dividend Distribution Tax @ 15% has been revoked by the Finance Ministry in 2011 severely affecting the IT industry.</p>
<p>The government finally took note of the increased disinvestment as a consequence of such taxes and proposed to make the imposition of MAT and Dividend Distribution Tax inapplicable to SEZ’s in 2015 <strong>[14]</strong>.</p>
<h2 id="3">3. E-Commerce Industry</h2>
<p>NASSCOM in 2012 suggested the lowering of the interchange tax rate on debit cards transactions by the RBI. Debit cards possess lower risk in comparison to credit cards, the transactions being concluded immediately and the same should be reflected in the form of differential taxes. A standard 1-2% interchange/transaction fees were generally levied by banks. NASSCOM also recommended the introduction of a 2% tax incentive on the purchase of products online to facilitate increased purchases and encourage consumers to even undertake small value transactions online. Further, it emphasized that the base of e-commerce users have to be expanded. It commented on the differences in the Internet usage costs between China and India, USD 10 and USD 15-20 respectively. High internet usage costs can only be indicative of reduced Internet access. However, this is not to state that the E-commerce industry is unsuited for India due to infrastructural inefficiencies. NASSCOM has stated that India as of 2012 possesses over 100 million Internet users. Technology has to be developed which would reduce dropout rates of transactions. Further it suggested the creation of an online receipt repository which would store all online transaction receipts, accessible through mobile phones or the internet. It would contribute in increasing customer confidence by enabling tracking of payment, delivery etc.</p>
<p>The RBI in response to the recommendations of NASSCOM and the Online Payment Advisory Group <strong>[15]</strong> and in consultation with all concerned stakeholders, decided to put a maximum limit on the Merchant Discount Rate (MDR) for transactions undertaken with a debit card [16].</p>
<h2 id="4">4. Transfer Pricing Issues</h2>
<p>Transfer Pricing has become the dominant international tax issue affecting multinational corporations operating in India [17]. As noted by NASSCOM, a steep rise in litigation and the number of transfer pricing adjustments with the Indian Revenue Authority (IRA) has been observed due to ‘increased scrutiny’ by the IRA who has been rejecting the profit declared by foreign companies accruing to Indian subsidiaries by applying very high markups in this sector. Increased complications in setting valid prices through this process have arisen due to the rising presence of ‘highly complex transactions’ involving intangibles and multi-tiered services across the world. The Finance Act 2012 extended the applicability of domestic party transactions to certain related domestic parties, if the aggregate value of such transactions exceeds INR 5 crore, to any expenditure with respect to which deduction is claimed while calculating profits and to transactions related to businesses eligible for profit-linked tax incentives, including SEZ units under section 10AA <strong>[18]</strong>.</p>
<p>NASSCOM has proposed a three pronged approach to the problem of backlog of cases and absence of certainty of price of transactions:</p>
<ol><li>Implementation of Safe Harbour provisions to resolve existing disputes.</li>
<li>Introduction of Advance Pricing Agreements <strong>[19]</strong> to set fair and transparent prices.</li>
<li>Initiation of review of the structure and procedure of the Dispute Resolution Panel <strong>[20]</strong>.<br /></li></ol>
<p>The Finance Act 2009 introduced section 92CB <strong>[21]</strong> in the Income Tax Act 1961 which provided for the subjection of the arms length price determined under section 92C or section 92CA to Safe Harbour Rules, to be declared by the Central Board of Direct Taxes (CBDT). For the valid determination of such a transfer price, the minimum transfer price that a taxpayer is expected to earn for international transactions is prescribed along with certain specific norms for particular transactions. The safe harbour transfer price for eligible transactions is subject to certain prescribed minimum ceilings <strong>[22]</strong>. A price determined in accordance with such guidelines would be deemed to be an Arms Length Price (ALP). To that extent the safe Harbour Rules are in the nature of ‘presumptive taxation’ and incentivises IT firms to avoid unnecessary litigation by opting for the same. Unilateral, bilateral and multilateral Advance Pricing Agreements, binding on the taxpayer and the revenue authorities for five consecutive years have been introduced with effect from 1 July 2012. Certain domestic transactions are inapplicable for APA’s in the absence of other monetary conditions/stipulations under law for entering into an APA. Documentation on comparables is required to be maintained to substantiate compliance with arms length principle.</p>
<p>The concerns of the prescribed rates include non-representation of industry benchmarks and economic realities in as much as the prescribed rates exceed the actual arms length prices, often leading to the risk of double taxation in foreign jurisdictions. The division of IT services into two components has also been criticized as many of the activities might overlap. NASSCOM has stated that it is not clear how the existing current issues are proposed to be resolved. The introduction of domestic parties as applicable parties to be subject to the transfer pricing regulations will only increase the complexity in the law. There has been subsequent judicial development involving the establishment of some principles for the valid determination of comparables for the purpose of identifying an acceptable transfer price which will be discussed in the next blog post.</p>
<h2 id="5">5. Other Recommendations</h2>
<h3 id="5-1">5.1. Concerns with the Union Budget Proposals</h3>
<p>NASSCOM summarized that the Union Budget Proposals 2012-13 focus on the reduction of the fiscal deficit through higher taxation rather than expenditure management. More specifically, it focuses on the following concerns of the IT Industry:</p>
<ul><li>The issues of tax simplification have not been resolved as no roadmap for the implementation of the Direct Taxes Code and the Goods and Services Tax Bill has been provided.</li>
<li>The increase in the Current Account Deficit should have incentivized the government to introduce measures which facilitate high value exports, which has been wholly ignored from the budget.</li>
<li>Increase in indirect taxes, namely excise duty and service tax is a retrograde policy measure.</li>
<li>Restrictive conditions in the SEZ Act 2005 which do not facilitate the setting up of small companies, have to be modified.</li>
<li>There is no mention of reduction of Tax Deducted at Source (TDS) for SMEs and introduction of non-profit linked incentives in the form of employment benefits etc. in the proposal.</li>
<li>Similar provisions should also be introduced for Tier II and III cities in the country.</li>
<li>Some announcements as to the simplification of service tax refund and the removal of the provisions involving dual levy of service tax and VAT are not sufficient to resolve ambiguities in law. NASSCOM, in light of the increasing delays of service tax, suggested exemption of export activity from such tax and the applicability of a simplified mechanism similar to CENVAT wherein exemption will be provided to exporters in proportion of their exports to total sales.</li></ul>
<h3 id="5-2">5.2. Request for Clarity in Classification of Transactions and Guidelines</h3>
<p>NASSCOM in its pre-budget recommendations had suggested that in light of the confusion of the characterization of software as goods or services and the resultant dual taxation, in the form of taxes paid to both the Central and the State Governments, the provision of software, whether customized or packaged should be treated as a service irrespective of the media and mode of transfer with the assurance from the States that no VAT shall be leviable on software. Further, guidelines have to be outlined for various e-commerce transactions like database subscription, cloud computing, webhosting and data warehousing. Onsite exporter of services are being denied the benefits of certain tax exemptions due to the sunset of STPI provisions, thus forming the need for a formal clarification by the government deeming these activities to be an integral component of the IT services industry.</p>
<h3 id="5-3">5.3. New Retrograde Obligations under Law</h3>
<p>NASSCOM emphasized that the introduction of certain provisions, related to GAAR, related party transactions and the withholding of tax in the Finance Bill, some of these retrospective in nature, enhance the difficulties faced by the IT industry. Increased obligations on the corporate tax payers in the form of imposition of additional taxes will only increase the scope of multiple interpretations of the provisions which will lead to the exercise of discretionary powers by the tax authorities.</p>
<h2 id="6">6. Endnotes</h2>
<p><strong>[1]</strong> As of September 2011, a significant majority of the 143 operational SEZs in the country belonged to the IT/ITeS and electronic hardware as per data released by the Ministry of Commerce and Industry.</p>
<p><strong>[2]</strong> See: <a href="http://articles.economictimes.indiatimes.com/2012-02-25/news/31099874_1_sez-unit-sez-promoters-multi-product">http://articles.economictimes.indiatimes.com/2012-02-25/news/31099874_1_sez-unit-sez-promoters-multi-product</a>.</p>
<p><strong>[3]</strong> Section 10AA of the Income Tax Act provides for 100% income tax exemption on export income for SEZ units for the first five years, 50% for the next five years and 50% of the ploughed back export profit for the next five years.</p>
<p><strong>[4]</strong> See: <a href="http://www.business-standard.com/article/economy-policy/govt-imposes-18-5-mat-on-sez-developers-units-111022800153_1.html">http://www.business-standard.com/article/economy-policy/govt-imposes-18-5-mat-on-sez-developers-units-111022800153_1.html</a>.</p>
<p><strong>[5]</strong> See: <a href="http://articles.economictimes.indiatimes.com/2005-07-08/news/27506703_1_special-economic-zone-act-sez-act-sez-bill">http://articles.economictimes.indiatimes.com/2005-07-08/news/27506703_1_special-economic-zone-act-sez-act-sez-bill</a>.</p>
<p><strong>[6]</strong> (2013)260CTR(Kar)146.</p>
<p><strong>[7]</strong> The doctrines of promissory estoppel and legitimate expectation, arising from legal relationships and reasonable expectation, respectively, are flexible equitable reliefs not defined in any statute. Judicial decisions have held that a party would not be entitled to go back on a clear and unequivocal promise which was intended to create legal relations, knowing or intending that it would be acted upon by the other party to whom the promise was made and acted upon by the other party under the doctrine of promissory estoppel. Legitimate expectation of a certain treatment arises against representation by an administrative authority, whether express (through promises), or implied (through consistent past practice) despite absence of any right otherwise.</p>
<p><strong>[8]</strong> It was held that the action of the government is legal as every tax exemption provision should also incorporate a sunset clause. The deletion of the exemption under law would only reduce the erosion of the tax base.</p>
<p><strong>[9]</strong> See: <a href="http://articles.economictimes.indiatimes.com/2011-05-11/news/29532409_1_sez-act-minimum-alternative-tax-mat">http://articles.economictimes.indiatimes.com/2011-05-11/news/29532409_1_sez-act-minimum-alternative-tax-mat</a>.</p>
<p><strong>[10]</strong> Madurai District Central Cooperative Bank Ltd. v. ITO (1975) 101 ITR 24(SC), the form and method of introduction of a legislation is not of importance provided the requirement of competence by the legislature to pass the deemed law with respect to its subject matter is satisfied. An amendment of a taxing statute, by an unconventional method of incorporation through an act of a different pith and substance is not unconstitutional. The primary purpose of the Finance Acts is to prescribe tax rates for taxes specified in the Income Tax Act. However, the above fact does not restrain the freedom of the legislature to impose an altogether new tax through the Finance Act or any other deemed legislation besides the Income Tax Act.</p>
<p><strong>[11]</strong> See: <a href="http://www.nasscom.in/nasscom-prebudget-recommendations">http://www.nasscom.in/nasscom-prebudget-recommendations</a>.</p>
<p><strong>[12]</strong> Ibid.</p>
<p><strong>[13]</strong> Ibid.</p>
<p><strong>[14]</strong> See: <a href="http://articles.economictimes.indiatimes.com/2015-02-13/news/59119589_1_sez-developers-and-units-minimum-alternate-tax-special-economic-zones">http://articles.economictimes.indiatimes.com/2015-02-13/news/59119589_1_sez-developers-and-units-minimum-alternate-tax-special-economic-zones</a>.</p>
<p><strong>[15]</strong> Formed in 2012 to examine the challenges faced by the E-commerce Industry in India and to recommend changes needed to facilitate the creation of a vibrant online payment sector.</p>
<p><strong>[16]</strong> Not exceeding 1 percent for transaction amount for value above 2,000. The directive was issued under section 18 of the Payments and Settlement Systems Act, with effect from July 1, 2012.</p>
<p><strong>[17]</strong> See: <a>http://www.pwc.com/gx/en/international-transfer-pricing/assets/india.pdf</a>.</p>
<p><strong>[18]</strong> This amendment would extend to any other transaction as may be specified and would be applicable for FY 2012-13 and subsequent years.</p>
<p><strong>[19]</strong> An Advance Pricing Agreement, generally covering multiple years, entered into between a taxpayer and at least one tax authority lays down the method of transfer pricing to be applicable to the taxpayer’s inter-company transactions which eliminates the need for transfer pricing adjustments for enclosed transactions provided the terms of the agreement are complied with.</p>
<p><strong>[20]</strong> The Finance Act 2009 inserted section 144C in the Income Tax Act which provides for the constitution of an alternative dispute resolution mechanism for transfer pricing taxation matters, namely a DRP (Dispute Resolution Panel) consisting of three commissioners rank officers.</p>
<p><strong>[21]</strong> Section 92CB defines Safe Harbour to be ‘circumstances under which the income tax authorities shall accept the transfer pricing declared by the assessee.’ The procedure for adopting safe harbour, the transfer price to be adopted, the compliance procedure upon adoption of safe harbours and circumstances in which a safe harbour adopted may be held to be invalid is specified in the new rules in 10TA to 10AG issued by the CBDT on 18th September 2013.</p>
<p><strong>[22]</strong></p>
<ul><li>Provision of software development services and information technology enabled services with insignificant risks- upto rs 500 crore- 20% or more on total operating costs, above rs 500 crore- 22% or more on total operating costs.</li><li>Provision of knowledge processes outsourcing services with insignificant risks-25% or more on total operating costs.</li><li>Provision of specified contract R & D services wholly or partly relating to software development with insignificant risks- 30% or more on total operating costs.</li></ul>
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<h2 id="7">7. Author Profile</h2>
<p>Pavishka Mittal is a law student at West Bengal National University of Juridical Sciences, Kolkata and has completed her second year. She takes contemporary dance very seriously and hopes to contribute to the dance community in India. Other than dancing, she indulges in binge-watching in her spare time.</p>
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For more details visit <a href='https://cis-india.org/raw/policy-shaping-in-the-indian-it-industry-recommendations-by-nasscom-2006-2012'>https://cis-india.org/raw/policy-shaping-in-the-indian-it-industry-recommendations-by-nasscom-2006-2012</a>
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No publisherPavishka MittalSpecial Economic ZonesTransfer Pricing PolicyNASSCOMResearchE-CommerceNetwork EconomiesIndustrial PolicyResearchers at WorkInformation Technology2016-07-04T08:11:05ZBlog Entry