Table of Contents

INTRODUCTION...................................................................................................... 2
UNCITRAL MODEL LAW........................................................................................... 2
COMPARATIVE STUDY............................................................................................. 4
1.)

APPLICATION OF PRINCIPLE IN AMERICA...................................................4

2.)

APPLICATION OF PRINCIPLE IN AUSTRALIA................................................5

3.)

PAKISTAN................................................................................................... 6

4.)

INDIA......................................................................................................... 7

Recent changes made in Indian evidence act after coming of IT act into force.
........................................................................................................................ 8
ROLE OF COURTS IN INDIA..................................................................................... 9
HINDUSTAN UNILEVER EMPLOYEES UNION VS THE INSPECTION OF FACTORIES
AND MANAGEMENT OF HINDUSTAN UNILEVER...................................................9
ODISHA CONSUMER ASSOCIATION CUTTACK VS ODISHA ELECTRICITY
REGULATING COMMISSION................................................................................. 9
20th CENTURY FOX FILM CORPORATION VS NRI FILM PRODUCTION ASSOCIATON
PRIVATE LIMITED............................................................................................... 10
AMITABH BACHIE VS VEENA BACHIE.................................................................10
CONCLUSION....................................................................................................... 11
BIBLIOGRAPHY...................................................................................................... 12

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INTRODUCTION.
Legal requirements prescribing the use of traditional paper-based
documentation are considered to be the main obstacle to the development of ecommerce. Functional equivalence principle involves an examination of the
function fulfilled by traditional form requirements (writing, signature,
original, dispatch and receipt) and a determination as to how the same
function could be transposed, reproduced, or imitated in a dematerialized
environment.

UNCITRAL MODEL LAW.

The Model Law on Electronic Commerce (MLEC) purports to enable and
facilitate commerce conducted using electronic means by providing national
legislators with a set of internationally acceptable rules aimed at removing legal
obstacles and increasing legal predictability for electronic commerce. In
particular, it is intended to overcome obstacles arising from statutory provisions
that may not be varied contractually by providing equal treatment to paperbased and electronic information. Such equal treatment is essential for enabling
the use of paperless communication, thus fostering efficiency in international
trade.
The UNCITRAL Model Law on Electronic Commerce recognizes
that legal requirements prescribing the use of traditional paper
based documentation constitute the main obstacle to the
development of modern means of communication. At the same time,
it is recognized that enabling legislation should not necessitate the
wholesale removal of the paper-based requirements themselves or
disturb the legal concepts and approaches, underlying those
requirements. To resolve these two concerns, the UNCITRAL Model
Law on Electronic Commerce relies on a new approach, sometimes
referred to as the "functional equivalent approach", which is based
on an analysis of the purposes and functions of the traditional
paper-based requirement with a view to determine how those
purposes or functions could be fulfilled through electronic
commerce. The concept is to singles out basic functions of paper
based form requirements, with a view to providing criteria, which,
once they are met by non-paper records, have the same level of
legal recognition as that of paper documents performing the same

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function. This primarily relates to writings, signatures and

originals, but not to other legal concepts.
The major thrust of the UNCITRAL Model Law on Electronic
Commerce as well as other statutory regimes governing ecommerce
is to provide for an equivalent to traditional writings but that serve
the same function that writing requirements have served. Thus, for
example, the UNCITRAL Model Law on Electronic Commerce
provides that where the law requires information to be in writing,
that requirement is met by a data message if the information
contained in it is accessible to be usable for subsequent reference.
This provision is applicable whether the requirement is in the form
of an obligation or whether the law simply provides consequences
for the information not being in writing.
The American Uniform Electronic Transactions Act, which was
roughly modelled on the UNCITRAL Model Law on Electronic
Commerce, provides that a record, signature or contract may not be
denied legal effect, validity or enforceability solely because it is in
the form of an electronic record. It also provides that if a law
requires a record or signature to be in writing, or provides
consequences if it is not, an electronic record satisfy that rule. The
Canadian Uniform Electronic Commerce Act likewise provides that
information shall not be denied legal effect or enforceability solely
by reason that it is in electronic form. It also provides that a
requirement for information to be in writing is satisfied by
information in electronic form if the information is accessible so as
to be usable for subsequent reference. Thus, as with the
UNCITRAL Model Law on Electronic Commerce and the American
Act, the Canadian legislation adopts a functional equivalence test.
The Australian Electronic Transactions Act has also been have been
drafted with the basic principles of media neutrality and technology
neutrality. As with the Model Act and the Canadian and American
Acts, the aim of using media neutral and technology neutral terms is
to focus on the purpose of the legal requirement, rather than the
form by which that requirement is satisfied. As with all of the ecommerce acts, this should prevent the need for continuous
amendments to deal with technological.

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COMPARATIVE STUDY.
1.) APPLICATION OF
PRINCIPLE IN AMERICA
America enacted Uniform Electronics Transaction Act on the basis of
UNICTRAL law. The UETA is a concise act consisting of only twenty-one
sections. The brevity of the Act is to a great extent due to the policy decision of
the drafters to eschew provisions governing substantive law. The UETA is
intended as a procedural act to provide a legal framework to do electronically
what has in the past been done through paper media. However, it is not intended
to create new substantive legal rules.
SECTION 201. LEGAL RECOGNITION OF ELECTRONIC RECORDS.
(a) A record may not be denied legal effect, validity, or enforceability solely
because it is an electronic record.
(b) If a rule of law requires a record to be in writing, or provides
consequences if it is not, an electronic record satisfies the requirement .
(c) In a transaction, a person may establish reasonable requirements
regarding the type of records acceptable to it.
SECTION 301. LEGAL RECOGNITION OF ELECTRONIC
SIGNATURES.
(a) A signature may not be denied legal effect, validity, or enforceability solely
because it is an electronic signature.
(b) If a rule of law requires a signature, or provides consequences in the
absence of a signature, the requirement is satisfied with respect to an electronic
record if the electronic record includes an electronic signature.
(c) In a transaction, a party may establish reasonable requirements regarding
the method and type of signatures acceptable to it.
SECTION 401(C)- Unless otherwise agreed, a contract may not be denied legal
effect, validity, or enforceability solely because an electronic record was used in
its formation.
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Sections 201(a), 301(a), and 401(c), each provide for the nondiscrimination against electronic media in the context of records, signatures and
contract formation, respectively. Though some questions have been raised
regarding the redundancy of these sections, they have been retained for clarity
and certainty in assuring the validation and effectuation of electronic records
and signatures in the specific context addressed by the respective sections.

2.) APPLICATION OF
PRINCIPLE IN AUSTRALIA
In 1999, the Australian Parliament passed the Electronic Transactions
Act 1999 (ETA). The ETA is designed to facilitate the development of
electronic commerce in Australia by removing existing legal impediments,
under national law, to using electronic communications.
The Act is based on the recommendation of the Australian Electronic
Commerce Expert Group that Australia enact legislation based on the
UNCITRAL Model Law on Electronic Commerce.
The ETA is founded on two principles:

functional equivalence (sometimes called media neutrality): ensures that

paper-based transactions and electronic transactions are treated equally by
the law; and

technology neutrality: ensures that the law does not discriminate between
different forms of technology.

The basic requirement under the Act for any electronic communication is that it
be readily accessible so as to be usable for subsequent reference. This ensures
that others will be able to access and use the information contained in the
electronic communication. In addition, a person should also be able to retain the
information in some way if he or she wishes to do so.

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One of the basic requirements of the Act is that a person must consent to
receiving electronic communications. Consent, however, can be either
expressed or inferred from a persons conduct.
The Act sets out general rules that allow certain legal requirements to be
satisfied by electronic communications. In addition to these general rules, the
Act covers specific issues, such as electronic signatures. To comply with the
Act, electronic signatures must identify the sender and indicate that partys
approval of the information communicated. The Act provides for the production
of an electronic document where the law requires the production of a paper
document.
Other provisions deal with the electronic recording of information, the
electronic retention of documents, and retention of electronic communications.
The Act also sets out rules in relation to the time and place of sending and
receiving electronic communications.
The ETA had a two-stage implementation process. As of 15 March 2000, the
Act applied to certain laws specified in the Electronic Transactions Regulations
2000. As of 1 July 2001, the Act applied to all national laws with a few
exceptions, and the Regulations were altered to reflect the exceptions.
Along with developments at the national level, the national, state and territory
governments together developed the Uniform Electronic Transactions Bill 2000,
which the Attorney General announced had been enacted by all state and
territory governments on 3 April 2000. The bill is closely modelled on
the Electronic Transactions Act 1999 and applies to contract law, as well as to
all dealings of the public with state and territory governments. Now each state
and territory has its own Electronic Transactions Act, which generally mirrors
the federal law except for some small modifications and additions in each
instance.

3.) PAKISTAN
Under Electronic transaction ordinance 2002,CHAPTER 2 RECOGNITION
AND PRESUMPTION section3 provides for functional equivalence principle.
Legal recognition of electronic forms.No document, record, information,
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communication or transaction shall be denied legal recognition,

admissibility, effect, validity, proof or enforceability on the ground
that it is in electronic form and has not been attested by any witness.
Section 7 provides for Legal recognition of electronic signatures.The
requirement under any law for affixation of signatures shall be
deemed satisfied where electronic signatures or advanced electronic
signature are applied.

4.) INDIA.
The following sections of information technology act 2000 enunciate the
principle of functional equivalence
Section 4. Legal recognition of electronic records. Where any law provides that
information or any other matter shall be in writing or in the typewritten or
printed form, then, notwithstanding anything contained in such law, such
requirement shall be deemed to have been satisfied if such information or
matter is (a) rendered or made available in an electronic form; and (b)
accessible so as to be usable for a subsequent reference.
Section 5 -Legal recognition of digital signatures. Where any law provides that
information or any other matter shall be authenticated by affixing the signature
or any document shall be signed or bear the signature of any person (then,
notwithstanding anything contained in such law, such requirement shall be
deemed to have been satisfied, if such information or matter is authenticated by
means of digital signature affixed in such manner as may be prescribed by the
Central Government.
Explanation.For the purposes of this section, "signed", with its
grammatical variations and cognate expressions, shall, with reference to a
person, mean affixing of his hand written signature or any mark on any
document and the expression "signature" shall be construed accordingly.
Section 6- Use of electronic records and digital signatures in Government and
its agencies.
(1) Where any law provides for (a) the filing of any form. application or any
other document with any office, authority, body or agency owned or controlled
by the appropriate Government in a particular manner; (b) the issue or grant of
any licence, permit, sanction or approval by whatever name called in a
particular manner; (c) the receipt or payment of money in a particular manner,
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then, notwithstanding anything contained in any other law for the time being in
force, such requirement shall be deemed to have been satisfied if such filing,
issue, grant, receipt or payment, as the case may be, is effected by means of
such electronic form as may be prescribed by the appropriate Government.
(2) The appropriate Government may, for the purposes of sub-section (1), by
rules, prescribe (a) the manner and format in which such electronic records
shall be filed, created or issued; (b) the manner or method of payment of any fee
or charges for filing, creation or issue any electronic record under clause (a).

Recent changes made in Indian

evidence act after coming of IT act
into force.
Section 65B of the IT act says that
(1) Notwithstanding anything contained in this Act, any information
contained in an electronic record which is printed on a paper, stored,
recorded or copied in optical or magnetic media produced by a computer
(hereinafter referred to as the computer output) shall be deemed to be
also a document, if the conditions mentioned in this section are satisfied
in relation to the information and computer in question and shall be
admissible in any proceedings, without further proof or production of the
original, as evidence of any contents of the original or of any fact stated
therein of which direct evidence would be admissible.
In section 3,(a) in the definition of "Evidence", for the words "all
documents produced for the inspection of the Court", the words "all
documents including electronic records produced for the inspection of the
Court" shall be substituted;
In section 34, for the words "Entries in the books of account", the words
"Entries in the books of account, including those maintained in an
electronic form" shall be substituted.
In section 35, for the word "record", in both the places where it occurs,
the words "record or an electronic record" shall be substituted.
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ROLE OF COURTS IN INDIA.

HINDUSTAN UNILEVER EMPLOYEES UNION VS THE
INSPECTION OF FACTORIES AND MANAGEMENT OF
HINDUSTAN UNILEVER

In this case this company was suffering from loss because employees didnt
attend the office at time. Frustrated from the loss, the company decided that
instead of paper based attendance it should issue ID cards and put a computer
machine on the gate which verifies the ID cards. Employees approached the
court and contended that computer machine should be removed.
However the court contended that the method of using computer machine is
completely legal. The company was protected under section 4 of the IT act
which gives equal validity to hard and soft copy.
ODISHA CONSUMER ASSOCIATION CUTTACK VS ODISHA
ELECTRICITY REGULATING COMMISSION

In this case, Odisha electricity act 2001,commission empowered the state to

increase the tarrif rate. But instead of giving this information in newspaper it
displayed it on the formal government site.
When the validity of this act was challenged , the court contended that the
government was protected under sec 6 and sec 8 of ITact. Where protection is
granted to publication of rule, regulations in electronic form.

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20th CENTURY FOX FILM CORPORATION VS NRI FILM

PRODUCTION ASSOCIATON PRIVATE LIMITED

This case dates back before independence of India ,filed in the state of Mysore.
It was filed seeking for an order to restrain the defendant from releasing,
screening of the film anywhere in India or in other countries. The court rejected
this contention and ordered the trial court to dispose off the case within 6
months. Facts of the case are that there were 6 defendants out of which 4
belonged to U.S.A. When they tried to arrive in Mysore for hearing of the case,
their arrival was obstructed due to the Cauvery water dispute in the state. Hence
the four witnesses rather returned back to U.S.A.
The court allowed the audio video link and affirmed that the evidence given
through audio video link was as valid as the ordinary evidence because of the
protection granted under section 4 of the IT act.
AMITABH BACHIE VS VEENA BACHIE

In this case husband and wife lived in u.s.a. The wife after being domestically
violenced returned back to India and claimed maintenance from her husband.
For this reason, the husband pleaded his inability to come to india and prayed
the court to allow the audio video link.
The court allowed the audio video link which is a proper evidence under sec 4
of the IT act.

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CONCLUSION.
The need for legal regulation in e-commerce follows the need for regulation,
both domestically and internationally in commerce in general, but two
important aspects of e-commerce are important to keep in mind that make ecommerce unique to other questions of commerce.
First, is the unregulated nature of the Internet. The Internet has brought about
fundamental changes to international commerce. Territorial borders and the
borders that previously existed between companies and customers, sellers and
purchasers and service providers and clients have all disappeared to some
extent. Particularly in transnational transactions, international agreements will
have to be adopted to provide some level of certainly to contracting parties.
A second aspect of e-commerce that makes it unique from other general
questions of international commerce is the apparent inability of the law to
foresee the rapid change in technology and therefore set out a set of
transactional rules that reflect business practices using that technology. This has
brought about great uncertainty in the law, largely caused by the shift from
paper to electronic trading. Questions consistently arise whether electronic
contracts are binding and enforceable as well as when and where they are
deemed to be created. It is with these legal uncertainties in mind that prompted
the Drafting of various legislative initiatives by UNCITRAL Model Law on
Electronic Commerce as well as the various national equivalents and the EC
directives.

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BIBLIOGRAPHY.
1.
2.
3.
4.

Information Technology Law and Practise, Vakul Sharma, Edn. 4, 2015

Introduction to Information Technology, Rajaram V., Edition 2 nd (Kindle)
www.indiakanoon.in/Information_technology/
www.en.brittanica.com/doc12653_ver+hu342/

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