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August 2010

Master of Science in Information Technology (MScIT-NEW) – Semester 3

MT0044 –: IT LAW AND PRACTICE– 2 Credits

(Book ID: B0056)
Assignment Set – 1 (30 Marks)
Each question carries six marks:
1. What are the legal implications of cyberspace? Explain
Legal implications of cyberspace
From a legal perspective, the term and the concept of a quasi-physical territory is helpful in
attempting to analyse the issues involved with computer communications. The geographical
location where conduct occurs is one of the major factors determining which country’s laws
apply to activities. Usually, the operations of global networks pay little heed to national
boundaries, and one of the arguments frequently mooted is that there is need for a new legal
regime in cyberspace. In the context of e-commerce, comparison is sometimes made with the
development of the Law Merchant in the Middle Ages-a body of law and courts developed and
administered by those responsible for commercial transactions, and which provided a consistent
legal basis for international trade, avoiding the vagaries and discrepancies of national legal
systems. Although there is a clear role for some forms of industry self-regulations, this
technique leaves unrepresented the vast numbers of individuals who deal with Internet Service
Providers (ISPs) and the increasing numbers of organizations offering goods or services over
the Internet. This is not, however, to suggest that cyberspace is presently unregulated. Indeed,
one of the problems involved in assessing the topic is that there is a surfeit of regulation. Laws
relating to broadcasting, the medial data protection, evidence, contract, tort, defamation and
intellectual property all have a role to play, as do provisions of criminal law. Indeed, the
inhabitants of cyberspace may be, at least in theory, the most massively regulated individuals in
the world in that, depending upon the nature of their activities, they may theoretically be
subject to the jurisdiction of virtually all of the world’s legal systems. Theory and practice are
greatly divergent, and the challenge of developing effective mechanisms for law enforcement is
substantially greater than that of identifying relevant legal provisions. In its 1988 Green Paper
on Copyright and the Challenge of Technology, the
Commission suggested that ‘these new technologies have entailed the de facto abolition of
national frontiers and increasingly make the territorial application of national copyright law
obsolete’. Such comments have equal validity with respect to other areas of the law, and
consideration nerds to be given to the uneasy relationship between terrestrial boundaries and
the claim to jurisdiction of the courts of a particular country, and the operation of worldwide
communications networks such as the Internet.
2. What is e- commerce? What are the benefits of e- commerce
E-commerce is a ‘commerce based on bytes’. E-commerce, defined simply, is the commercial
transaction of services in an electronic format. In general terms, e-commerce is a business
methodology that addresses the needs of organizations, traders and consumers to reduce costs
while improving the quality of goods and services and increasing the speed of service delivery.
It may also be referred to as the paperless exchange of business information using Electronic
Data Interchange, Electronic Fund Transfer etc. E-commerce is not only about simple
transactions of data but also general commercial acts such as publicity, advertisements,
negotiations contracts and fund settlements. It refers to all forms of transactions relating to
commercial activities including both organizations and individuals that are based upon the
processing and transmission of digitized data, including text sound and visual images.
The World Trade Organization (WTO) Ministerial Declaration on E-commerce defines e-
commerce as, “the production, distribution, marketing, sales or delivery of goods and services
by electronic means”. The six main instruments of e-commerce that have been recognized by
WTO is telephone, fax, TV, electronic payment and money transfer systems, EDI (electronic
data interchange) and the Internet.

Benefits of e-commerce
Use of e-commerce technologies helps speed up the flow of information and to eliminate
unnecessary human intervention; the computer can now accomplish what computers do better
than people – process routine business transactions quickly and accurately, 24 hours a day. This
in turn, frees up people to handle tasks that computers may never be able to do –exercising
judgment, creativity, and experience to manage exceptions, solve problems and continually
improve business processes.
E-commerce is growing in importance and means unprecedented opportunities for everyone.
When a business takes advantage of the power of e-commerce, it will be able to.
(i) Increase customer satisfactions
The Internet is always open, even on holidays; business is thus always open, 24 hours a day, 7
days a week and 365 days a year. Customers will appreciate the extra access to product
updates, shipping details, billing information and more. And since the internet knows no
boundaries, customers can shop from home, work, or anywhere they can make a connection.
Besides, by connecting the e-commerce and shipping systems, it would be possible to ship
products faster and for less money.
(ii) Increase sales volumes
The Internet is a new channel to reach new channel to reach new customers. With a Web site, a
company can automatically become a global provider of goods and services, with an edge over
even the largest competitors. Interactive selling is advantageous because a company is no
longer limited by shelf-space or inventory concerns but instead offer all products to suit the
customers’ exact specifications.
(iii) (iii) Decrease costs of doing business
E-commerce helps cut out or streamline processes that eat away profits.
For instance exchange of information from advertising to availability updates, can add to the
cost of a sale. However, the web site can be an efficient, cost-effective communication vehicle.
Customers can find timely accurate information in one place when they need it. By using e-
commerce, everything from purchase orders to funds transfer can be handled faster and more
efficiently. Even payment processing and bookkeeping are easier.

3. Write a note on Adoption of security standards by the industry
Adoption of security standards by the industry business thrives on safety, security and trust
whether it is offline or online.
The Internet being an open, integrated and public system requires far better security coverage
than its offline counterpart. It needs an ‘encryption’ technology that provides
(i) Confidentiality (ii) authentication (iii) integrity (iv) non-repudiation and of electronic

i. Confidentiality
The idea is that the information should be protected from unauthorized internal as well as
external users by making it undecipherable. It uses encryption technology to ‘encrypt’ the
information in such a way that only an intended user could ‘decrypt’ the information.
ii. Authentication
It means use of encryption technology to identify the sender or originator of the information.
Similarly it should be possible to ensure that the message is sent to the person for whom it is
iii. Integrity
It is to verify that the information, which is received, has not been manipulated during its
transmission. On retrieval or receipt at the other end of a communication network the
information should appear exactly as it was stored or sent by the sender or originator.
iv. Non-repudiation
It is to ensure that the sender or originator cannot disown information at a later date. Encryption
technologies make it possible to bind messages and message acknowledgements with their

4. What is Cyber law? Explain why cyber law in India
Definition of cyber law
Internet is believed to be full of anarchy and a system of law and regulation therein seems
contradictory. However cyberspace is governed by a system of law and regulation called Cyber
law. There is no single exhaustive definition of the term “Cyber law”. The definition of Cyber
law which is broadly accepted is as follows:-

Simply speaking, Cyber law is a generic term which refers to all the legal and regulatory
aspects of Internet and the World Wide Web. Anything concerned with or related to or
emanating from any legal aspects or issues concerning any activity of citizens and others, in
Cyberspace comes within the ambit of Cyclone,

Why Cyber law in India?

In the 49th year of Indian independence, Internet was commercially introduced in India. The
beginnings of Internet were small and the growth of subscribers painfully slow.
However, an Internet has grown; the need has been felt to enact the relevant Cyber laws, which
are necessary to regulate Internet in India. This need for Cyber laws was propelled by
numerous factors.
Firstly, India has an extremely detailed and well-defined legal system in place.
Numerous laws have been enacted and implemented and the paramount among them is The
Constitution of India. We have various laws like Indian penal Code, 1860, The Indian Evidence
At, 1872, The Banker’s Book evidence Act, 1891, The Reserve Bank of India Act, 1934, The
Companies Act, 1956, and so on. However, the arrival of Internet signaled the beginning of the
rise of new and complex legal issues. It maybe pertinent to mention that all the existing laws in
place in India were enacted keeping in mind the relevant political, social, economic, and
cultural scenario of that time. Nobody then could really visualize the emergence of the Internet.
Despite the brilliant acumen of our master draftsmen, the requirements of cyberspace could
hardly be anticipated. The coming of Internet led to the emergence of numerous ticklish legal
issues and problems, which necessitated the enactment of Cyber laws.
Secondly, the existing laws of India could not be interpreted in the light of the emerging
cyberspace, to include all aspects relating to different activities in cyberspace.
Thirdly, none of the existing laws gave any legal validity or sanction to the activities in
Cyberspace. For example, the Net is used by a large majority of users for email purposes. Yet,
email was not “legal” in our country. There was no law in the country, which accorded legal
sanctity to email and the electronic format. The judiciary in our country had been reluctant to
grant judicial recognition to the legality of email in the absence of any specific law having been
enacted by Parliament on the subject. Thus the need arose for enacting Cyber law in our
Finally, Internet requires an enabling a supportive legal infrastructure in time with the
times. This legal infrastructure can only be given by the enactment of the relevant Cyber laws
as the traditional laws have failed to provide it. E-commerce the biggest future of Internet can
only be possible if necessary legal infrastructure complements the same to enable its vibrant
growth. As such, an urgent need was felt for enacting Cyber law in our country.

5. Write a note on Secure Digital signature
Secure digital signature
If, by application of a security procedure agreed to by the parties concerned, it can be verified
that a digital signature, at the time it was affixed, was –
(a) unique to the subscriber affixing it;
(b) capable of identifying such subscriber;
(c) created in a manner or using a means under the exclusive control of the subscriber and is
linked to the electronic record to which it relates in such a manner that if the electronic
record was altered the digital signature would be invalidated, then such digital signature
shall be deemed to be a secure digital signature.
Section 15 gives the definition of a secure digital signature. The requirements of section 15
have to be satisfied before the digital signature in question can be termed as secure. The section
mandates that in a secure digital signature, there must be an application of security procedure
agreed to by the concerned parties. In the present case, the legislature has thought fit not to
prescribe any specific security procedure in usage at large but has left the same to the
subjective will and discretion of the concerned parties.
However, the application of the security procedure should result in the factum of verification.
The verification should be to the effect that the digital signature, at the time when it was
affixed, was unique to the subscriber affixing the same. Verification is also required to show
that a digital signature, at the time it was affixed, was created in a manner or using a means or
process under the exclusive control of the subscriber and that the same is linked to the
electronic record to which it relates. However, it is necessary that the linking must be such that
in case there was any alteration of the electronic record, the digital signature would be
invalidated. If these mandatory conditions of law were fulfilled, the digital signature would be
termed as a secure digital signature in the eyes of law within the meaning of Section 15.