Penalties  under  the  Competition  Act

(By Yadukrishnan, B., IInd Year LL.M. (Business Laws),
National  Law  School  of  India  University,  Bangalore)

 

INTRODUCTION

 

“There is an immense need to have a proper regulatory mechanism for prevention of anti­competitive agreement which not only affects the market economy leading to monopolistic approach but also victimizes the consumers and thereby cause harm to the entire economy creating hindrance to the competition in the market.”   --  By Adam Smith

 

The term Competition¹ basically refers to the act of competing as for profit or a prize, rivalry. In other words the term competition refers to rivalry between two or more businesses striving for the same customer or market. In India the law relating to competition is stated under theCompetition Act, 2002². The basic objective of the act is to ‘provide, keeping in view of the economic development of the country, for the establishment of a Commission to prevent practices having adverse effect on competition, to promote and sustain competition in markets, to protect the interests of consumers and to ensure freedom of trade carried on by other participants in markets, in India and matters connected therewith or incidental thereto. This is the basic objective of the Competition Act, 2002. Before the passing of the Competition Act in India the law relating to competition was stated under the Monopolistic Restrictive Trade Practices Act, 1969³. The fact is that when India opened its economy to the global players from 1992 onwards, then the prevalent law known as M.R.T.P. Act became redundant and ineffective, and in order to protect competition The Competition Act, 2002,(hereinafter referred as ‘the Act’) was enacted and M.R.T.P. Act was repealed. Thus after passing the Competition Act the Government of India has also acquired a wider perspective on regulation of market from merely curbing monopoly to promoting competition.

 

The term penalty⁴ means providing punishments. Chapter VI of the Competition Act, 2002 deals with the penalties. Sections 42 to 48 of the Act deals with the various areas of penalties under the Competition Act. The penal provisions under any Act are the principle tool behind enforcement of any law as it creates deterrence to do a prohibited act under any law. There has been an evolution from the reformative measures provided under M.R.T.P. Act to punitive measures under the provisions of ‘the Act’ due to changing economic and global scenario. Infringement of competition law covers a wide range of practices such as abuse of dominant market positions, vertical restraints, horizontal price fixing, etc., cartels, in the strictest sense, is the most extreme form of horizontal price fixing and is considered the most serious infringement. Therefore the competition law must be very keen in keeping the pace with globalization and changing practices.

 

INDIAN  SCENARIO  WITH  REGARD  TO  PENAL  PROVISIONS

 

As it is already mentioned the basic reason for the infringement of competition is due to abuse of dominant position, anti-competitive agreements, cartel agreements, predatory pricing etc. In order to understand the nature of infringement we have to go through the above stated practices. The Competition Commission can pass its orders when it is found that there is a contravention of section 3 or 4 of the Act. It passes the order under section 27 of the Act.

 

1) ABUSE OF DOMINANT POSITION

 

Section 4 of the Competition Act, 2002 deals with the abuse of dominant power or position⁵. This section provides that no enterprise shall abuse its dominant power. Dominant power is said to be abused when an enterprise or a group imposes unfair or discriminatory condition in purchase or sale of goods or services or its price.

 

The Commission while making inquiry and investigation has take  into consideration the following factors, as enumerated u/S. 19(4) of the Act to determine the dominant position as contemplated u/S. 4 of the Act, which inter alia includes:

 

     i)           Market share of the enterprise;

     ii)          Size and resources of the enterprise;

     iii)         Size and importance of the competitors;

     iv)         Economic power of the enterprise including commercial advantages over                     

                   competitors;

     v)          Vertical integration of the enterprises, or sale or service network of such                                       

                   enterprises;

     vi)         Dependence of consumers on the enterprise;

     vii)        Monopoly or dominant position whether acquired as a result of any  

                  statute or by virtue of being a Government company or a public sector                 

                  undertaking or otherwise;

     viii)       Entry barriers including barriers such as regulatory barriers, financial risk,

                  high capital cost of entry, marketing entry barriers, technical entry      

                  barriers, economies of scale, high cost of substitutable goods or service

                  for consumers;

     ix)         Countervailing buying power;

     x)          Market structure and size of market;

     xi)         Social obligations and social costs;

    xii)       Relative advantage, by way of the contribution to the economic

                development, by the enterprise enjoying a dominant position having or

                likely to have an appreciable adverse effect on competition;

    xiii)       Any other factor which the Commission may consider relevant for the

                inquiry. After taking into consideration the above factors, the Commission

                has to determine about the dominant position of an enterprise and the

                dominant position has been definedu/S.4(2) of the Act as “a position of

                strength, enjoyed by an enterprise in the relevant market in India which

                 enables it to;

1)              Operate independently of competitive forces prevailing in the relevant

 market, or

    

2)         Affect its competitors or consumers or the relevant market in its favor.”

 

The Commission can impose such penalty, as Commission may deem fit which shall be not more than ten per cent of the average turnover for the last three preceding financial years, upon each of such person or enterprises which are parties to such agreements or abuse.
If penalty is proposed to be imposed by Commission on a person, show cause notice duly signed by secretary shall be given asking for submitting explanation in writing within 15 days. Penalty shall be imposed only after giving opportunity of personal hearing to the person.

 

2)  ANTI-COMPETITIVE  AGREEMENTS

 

Section 3 of the Competition Act, 2002 deals with Anti-competition Agreements⁶. Anti competitive agreements are those agreements which are against the competition policies.

 

Agreements in respect of production, supply, distribution, storage, acquisition or control of goods or provision of services that cause or are likely to cause appreciable adverse effects on competitions within India are anti-competitive agreements. Such agreements are prohibited by the law and are stated to be as void.

 

The Commission while making inquiry and investigation in order to ascertain that whether there is an existence of Anti-Competitive Agreement(s) or not, as contemplated u/S. 3 of the Act, it has to determine that whether such an agreement has an element of conspiracies and monopolizes against consuming public and such unfair trade practice that unfairly disadvantageous to competitors or injure the consumers. It is pertinent to note that such agreements are termed void u/S.3(2) of the Competition Act and section 3(3) deals with horizontal agreement i.e. Cartel’s whereas section 3(4) deals with vertical agreements. However, exceptions are provided u/S.3(5) of the Act. Section 2(c) provides that ‘cartel includes an association of persons, sellers, distributors, traders or service providers who by an agreement amongst them limit, control or attempt to control the production, distribution, sale or price of, or, trade in goods or provision of services. The term AAEC has not been defined in the Act, but section 19(3)⁷ of the Act provides for certain factors to be given due regard by the Commission while determining whether an agreement have AAEC or not, namely, creation of barriers to new entrants in the market or driving existing competitors out of the market or foreclosure of competition by hindering entry into the market, etc.

 

3)  CARTEL AGREEMENTS

 

Cartels⁸ are regarded as the most pernicious form of anti social behavior. Hard core cartels are on top of the agenda of most competent authorities. Cartels are of two types private cartels and public cartels. Competition laws often forbid private cartels. Identifying and breaking up cartels is an important part of the competition policy in most countries, although proving the existence of a cartel is rarely easy, as firms are usually not so careless as to put collusion agreements on paper.

 

Several economic studies and legal decisions of antitrust authorities have found that the median price increase achieved by cartels in the last 200 years is around 25%. Private international cartels (those with participants from two or more nations) had an average price increase of 28%, whereas domestic cartels averaged 18%. Fewer than 10% of all cartels in the sample failed to raise market prices.

 

Cartel Case: Builders Association of India v. Cement Manufacture Association & Others⁹ this case of the Builder Association was against 11 large Cement Manufacturing companies wherein the allegation was that the Cement Manufacturing Association has violated the provisions of the Competition Act through anti-competitive agreements including Cartels, whereby these companies reduced their production intentionally and deliberately. The allegations were found to be true in investigation by the Director General and that resulted in violation of provisions of section 3 of the Competition Act. The Commission levied the penalty @ 0.5 times of their profit (as against three times of profit as provided under the Act) on each company found guilty, for the Financial Year 2009-10 and 2010-11, amounting to `6,000 crore approximately.

 

Effect of above orders passed by the Commission: Now most of these companies have filed appeal before the Competition Appellate Tribunal (COMPAT), against the order passed by the Competition Commission, being aggrieved, and there is a discussion amongst the legal fraternity as well that whether the turnover of the company or enterprise or person should be the turnover of the related product or the company or enterprise as a whole.

 

4) PREDATORY  PRICING

 

Predatory pricing is an anti-competitive practice by a firm which aims at monopolizing the market and to drive out the other competitors. It is done by charging prices less than the costs that a firm incurred in its production process. It restricts competition in the market and is considered to be as illegal under anti- trust laws of many countries. The “predatory pricing” under the Act means “the sale of goods or provision of services, at a price which is below the cost, as may be determined by regulations, of production of goods or provision of services, with a view to reduce competition or eliminate the competitors”. Predation is exploitative behavior and can be indulged in only by enterprises(s) having dominant position in the concerned relevant market. As it is an anti- competitive practice it is prohibited and penalty is prescribed under competition law.

 

INTERNATIONAL  SCENARIO-PENALTIES  WITH  REGARD  TO  COMPETITION  LAWS

 

In U.S.A. competition law is known as “Antitrust laws”¹⁰. The antitrust laws are the original and in many ways and are most important components of the United States Federal Economic Regulatory Scheme. Sherman Act is the original and principle antitrust statute of the U.S. and was the earliest in the world, enacted in 1890, and called as ‘Sherman Antitrust Act, 1890’. Two great ideologies of the market and the State have shaped the evolution of antitrust laws in U.S.A. since 1890, namely ‘Evolutionary and Intentional Vision’. Evolutionary vision views the market, framed solely by common law rules of property and contract and the intentional vision views the market as a mechanism within which powerful interests can coerce consumers, labor, and small businesses; markets in this vision, tend toward monopoly unless Government intervenes. However Sherman Act embodied a legislative compromise between these two visions.

 

LEGISLATION

 

Sherman Act¹¹ is the premier article of federal law. It is the original, principal, and foremost antitrust statute in the United States, setting forth the broad statutory proscriptions that act as a “charter of the marketplace” and “constitution of competition law” in American jurisprudence. The Sherman Act in its current form provides both civil remedies and criminal penalties for the principal antitrust violations — conspiracies to restrain trade, monopolization, attempted monopolization, and conspiracies to monopolize. The key provisions of the Sherman Act are contained in Section 1 and Section 2 which are respectively analogous to Articles 101 and 102 of the EU treaty and Section 3 and 4 of Indian Competition Act. Section 1 of the Sherman Antitrust Act deals with anticompetitive conduct and prohibits agreements in restraint of trade—such as price-fixing, refusals to deal, bid-rigging, etc., whereas Section 2 of the Sherman Act deals with end results that are anticompetitive in nature and forbids monopolizing or attempting to monopolize. After the Sherman Act, Congress enacted two new antitrust laws in 1914. First, Congress enacted the Federal Trade Commission Act, which created the Federal Trade Commission and gave it the authority to enforce U.S. antitrust laws i.e. to enforce the Sherman Act, the Clayton Act12, and the Robinson-Patman Act¹³.

 

Second, Congress enacted the Clayton Antitrust Act, which was intended to supplement and strengthen enforcement of antitrust laws. It added new forms of prohibited conduct, such as “mergers and acquisitions where the effect may substantially lessen.

 

Robinson-Patman Act, 15 U.S.C. § 13a, also provides criminal sanctions of not more than 1 year of imprisonment and unto a $5000 fine, for price discrimination for purpose of destroying competition or eliminating a competitor.

 

PENALTY  UNDER  CLAYTON  ACT,  1914

 

The Clayton Act is a civil statute (as it carries no criminal penalties) and provides that civil actions may be brought by the U.S. Government or by private parties to enforce the federal antitrust laws, including the Sherman Act. Such civil actions to enforce the Sherman Act are the most frequent type of antitrust litigation. Individuals injured by antitrust violations can sue the violators in court for three times the amount of damages actually suffered. These are known as treble-damages, and can also be sought in class-action antitrust lawsuits.

 

PENALTIES  UNDER  FEDERAL  TRADE  COMMISSION  ACT,  1914

 

The Federal Trade Commission Act, adopted in 1914¹⁴, prohibits “unfair methods of competition” and “unfair or deceptive acts or practices.’The Federal Trade Commission was established to enforce the statute.

 

PENALTIES  UNDER  ROBINSON-PATMAN  ACT,  1936

 

The Robinson-Patman Act, 1936 is an amendment to Section 2 of the Clayton Act which was primarily intended to protect small businesses from price discrimination and is aimed to recover the treble damages. The F.T.C. has statutory authority to enforce the Robinson-Patman Act, but has largely left enforcement to private plaintiffs in the last 20 years.

 

PENALTIES  UNDER  SHERMAN  ANTI  TRUST  ACT,  1890

 

The penalties under US Antitrust Laws, the Sherman Act provides for the penalty in the form of financial fines as well as imprisonment and which are enshrined in Section 1 and 2, which specifies the anti-competitive agreements as well as abuse of its dominant position, which are mentioned herein below¹⁵ :

 

1)   Sherman Act, 15 U.S.C. § 1 Trusts, etc., in restraint of trade illegal; penalty

 

2)   Sherman Act, 15 U.S.C. § 2 Monopolizing trade a felony; penalty16

 

VIOLATIONS  OF  STATE  ANTI-TRUST  LAWS

 

State antitrust laws often prohibit the same kinds of conduct as the federal antitrust laws. As a result, the penalties state laws impose are also similar and can range from criminal to civil sanctions.

 

PENALTY  PROVISIONS  UNDER  THE  COMPETITION  ACT, 2002

 

The penal provisions have been enshrined in Chapter VI, Section 42 to 48 of the Competition Act¹⁷:, which are mainly for contravention of order(s) passed by the Commission. These penal provisions are:

 

Section 42: Penalty for Contravention of Orders of Commission: According to this section, if any person, without reasonable clause, fails to comply with the orders or directions of the Commission issued under sections 27, 28, 31, 32, 33, 42A and 43A of the Act, he shall be punishable with fine which may extend to `1,00,000/- per day, during which such non­compliance occurs, subject to a maximum of `10,00,00,000/- (`Ten crores), as the Commission may determine, or in case if such person fails to pay fine imposed above, or fails to comply the direction, then there is a provision of imprisonment up to three years or fine up to `25,00,00,000/- (Rupees twenty five crore), or with both, as the Chief Metropolitan Magistrate, Delhi may deem fit. Section 42 has been effective from 20.5.2009.

 

Section 42A¹⁸ : Compensation in case of contravention of orders of commissions- Thissection provides that a person may make an application to Competition Appellate Tribunal for recovery of compensation from an enterprise for any loss or damage suffered by him for violating the directions u/S. 27, 28, 32, 33 and 41 of the Act.

 

Section 43:Penalty for failure to comply with directions of Commission and Director General.- Under this section, if any person has not complied with the directions of the Commission/DG in terms of Section 36(2) and 36(4) or u/S. 41(2) of the Act, a penalty of `1 lakh per day subject to maximum of  `100 lakhs has been provided in this section.

 

Section 43A¹⁹ : Power to impose penalty for non-furnishing of information on combinations. -This section provides that if any person or enterprise has failed to give notice to the Commission u/S.6(2) of the Act, in respect of any amalgamation or merger or acquisition, then such person or enterprise is liable to pay penalty imposed by the Commission subject to a maximum of 1% of total turnover or assets, whichever is higher of a combination.

 

Section 44: Penalty for making false statement or omission to furnish material information.-This section contemplates that in case if a person, being a party to the combination, fails to make a particular statement or makes the false statement to his knowledge, then he is liable to pay `50 lakh, as penalty which may be extend to `100 lakh.

 

Section 45: Penalty for offences in relation to furnishing of information.- According to this section, if any person makes a false statement knowingly or omits to state any material knowingly or willfully alters, suppress or destroys any document which is required to furnish, he may be punished with a penalty/fine of `1,00,00,000/-. Section 45 has been effective from 20.5.2009.

 

Section 46: Power toimpose lesser penalty.- The Commission on being satisfied that any producer,seller, distributor, trader or service provider included in any cartel, which is alleged to have violated Section 3, has made a full and true disclosure in respect of the alleged violations and such disclosure is vital, impose upon such producer, seller, distributor, trader or service provider a lesser penalty as it may deem fit, than leviable under this Act or the rules or the regulations. However, the benefit of such lesser penalty benefit will be given provided the person making the disclosure continues to co-operate with the Commission till the completion of the proceedings. Additional penalty can be imposed on producer, seller, distributer, trader or service provider included in cartel, if he had not complied with conditions or had given false evidence or disclosures made were not vital. Section 46 has been effective from 20.5.2009. This section is otherwise known as leniency provisions. Leniency provisions are applicable only to cartels.

 

Section 47: Crediting sums realized by way of penalties to Consolidated Fund of India. -All sums realized by way of penalties under this Act shall be credited to the Consolidated Fund of India. Section 47 has been effective from 20.5.2009.

 

Section 48: Contravention by companies.- This section provides with special provisions relating to offences committed by firms and companies or any of its Director or Partner or Officer or Manager or Secretary has committed the contravention of any of the provisions of this Act and who was in charge and was responsible for conduct of business of a company or firm, then each such person of that firm or company and company or firm shall be liable to proceed against them and punish them accordingly. However, this section provides an exception that if any proves that he was not in charge of the affairs of firm or company a firm or such contravention has not taken place with his consent or connivance, then the penalty provision of this Act shall not be applicable on that person. Section 48 has been effective from 20.5.2009.

 

From the above synopsis of penalty provisions under the Competition Act, 2002, it is very much clear that the Act does not contemplate the penalties for contravention of provisions of Section 3 and 4 of the Act, but also contains fines or penalties for non-observance of commission orders, rules and or furnishing of false and incomplete information during the process of investigation and even after any order is passed by the Commission. The most important aspect of the penalties is that how the penalty is to be determined. As regards to penalty provisions under Sections 42 to 46, they are very specific with leniency provisions under Section 46 of the Act. The most important and critical part is that how the penalties shall be determined u/S.27 of the Act keeping in mind the basic objective of the Act, legislative intention and what penalty on what quantum shall be levied.

 

The present position with regard to these sections is that it has not been amended till present. The recent amendment has been brought out to insert Section 42A and Section 43A. These sections were inserted in accordance with the Competition (Amendment) Act, 2007. Section 42 A deals with Compensation in case of contravention of orders of commissions. Section 43A deals with Power to impose penalty for non-furnishing of information on combinations.

 

Prior to the passing of this act sections 50 to 52 A of MRTP Act, 1969²⁰ deals with penalty provisions for infringement of competition. Section 50 of the Act deals with penalty for offences in relation to orders under the Act. Section 52 A deals with penalty for contravention of any condition or restriction, etc.

 

CONCLUSION

 

In today’s globalized economy, violations of competition law are often performed internationally and therefore enforcement of competition law is also growing ever more international. There is a great emphasis on international cooperation with foreign authorities. Thus, in a developing economy like ours though the legislators have done their best to frame laws which would provide suitable conditions for a fair and perfect competition, but still, the present act requires some alterations to make it more effective on an international level. It is believed that by making the required changes in imposition of penalty under the Competition Act, 2002, in line with the other international competition law forums, it would not act as more deterrent and ultimately achieve its objective.

 

 

 

 

Foot Note

1.www. the free dictionary.Com.

 

2.An Act to provide, keeping in view of the economic development of the country, for the establishment of a Commission to prevent practices having adverse effect on competition, to promote and sustain competition in markets, to protect the interests of consumers and to ensure freedom of trade carried on by other participants in markets, in India or for matters connected therewith or incidental thereto.

 

3.An Act to provide that the operation of the economic system does not result in the concentration of economic power to the common detriment, for the control of monopolies, for the prohibition of monopolistic and restrictive trade practices and for matters connected therewith or incidental thereto.

 

4.According to Advanced Learner’s Dictionary the term penalty refers to a punishment for breaking a law, rule or contract or a disadvantage or unpleasant experience suffered as the result of an action or circumstances’. The Competition Laws around the world contains the penalty provisions for infringement of Competition Law as a rule, and ‘the Act’ is not an exception to such rule. The infringement of competition law in the form of abuse of dominant position, anti-competitive agreements, Cartel agreements are damaging to economy of any country/union and are also against the spirit of consumer welfare around the world and this is the reason that the object of the Competition Laws and Penalty provisions under those laws have the same object and effect. Therefore, the Penalty provisions under the Competition Act acts as a deterrence to achieve the ultimate objective of enactment of Competition Laws around the world.

The basic objective of penalties under the Competition Act is that it not only acts as an instrument of deterrence but also it acts for retribution, education and denunciation. (www.the free dictionary.com).

 

5.Section 4 of the Competition Act deals with the abuse of dominant power or position. This section provides that no enterprise shall abuse its dominant power. Dominant power is said to be abused when an enterprise or a group imposes unfair or discriminatory condition in purchase or sale of goods or services or its price.

 

6.Section 9- Anti competitive agreements- Anti competitive agreements are those agreements which are against the competition policies. Agreements in respect of production, supply, distribution, storage, acquisition or control of goods or provision of services that cause or are likely to cause appreciable adverse effects on competitions within India are anti-competitive agreements. Such agreements are prohibited by the law and are stated to be as void.

 

7  Section 19 (3)- The Commission shall, while determining whether an agreement has an appreciable adverse effect on competition under section 3, have due regard to all or any of the following factors, namely:—

(a)creation of barriers to new entrants in the market;

(b)driving existing competitors out of the market;

(c)foreclosure of competition by hindering entry into the market;

(d)accrual of benefits to consumers;

(e)improvements in production or distribution of goods or provision of services;

(f)promotion of technical, scientific and economic development by means of production or distribution of goods or provision of services.

 

8.Cartel- It is a formal agreement among competing firms.

 

9.Builders Association of India v. Cement Manufacture Association & Ors. 

 

10. En.wikipedia.org./wiki/competition law.

 

11. Sherman Act- The Sherman Antitrust Act is a land mark federal statute on competition law passed by congress in 1890. It prohibits certain business activities that reduce competition in the marketplace, and requires the United States Federal Government to investigate and pursue trusts companies, and organizations suspected of being in violation. It was the first Federal statute to limit cartels and monopolies, and today still forms the basis for most antitrust litigation by the United States federal government. However, for the most part, politicians were unwilling to refer to the law until Theodore Roosevelt’s presidency. ((En.wikipedia.org./wiki/Sherman-antitrust act - visited on 8th January 2013).

 

12. The Clayton Act 1914- The Clayton Anti-Trust Act, 1914 was enacted in United States to add further substance to the U.S. antitrust law regime by seeking to prevent anticompetitive practices in their incipiency. That regime started with the Sherman Antitrust Act of 1890, the first Federal law outlawing practices safe considered harmful to consumers (monopolies, cartels, and trusts). The Clayton Act specified particular prohibited conduct, the three-level enforcement scheme, the exemptions, and the remedial measures.

 

13. The Robinson Patman Act 1936-The Robinson-Patman Act of 1936 is a United States federal law that prohibits anticompetitive practices by producers, specifically price discrimination. It grew out of practices in which chain stores were allowed to purchase goods at lower prices than other retailers. An amendment to the Clayton Antitrust Act, it prevented unfair price discrimination for the first time, by requiring that the seller offer the same price terms to customers at a given level of trade. The Act provided for criminal penalties, but contained a specific exemption for “cooperative associations”.

 

14.The Federal Trade Commission Act of 1914 started the Federal Trade Commission (FTC), a bipartisan body of five members appointed by the president of the United States for seven-year terms. This commission was authorized to issue “cease and desist" orders to large corporations to curb unfair trade practices. This Act also gave more flexibility to the U.S. Congress for judicial matters. It passed the Senate by a 43-5 vote on September 8, 1914, and, without a tally of yeas and nays, it passed the House on September 10.

 

15.www.appliedantitrust.com/02_criminal/acper/oracle/oracle_ndcal_strike_opp6_   

      10_2011 dec_e xA.pdf

 

16.Sherman Act,1890, S.M.Gugar-Guide to Competition Law (5th edition volume II).

 

17.CHAPTER VI of the Competition Act, 2002 deals with penalties under the Competition Act. Sections 42-48 of the Act deals with those penalties.

 

18.Section 42 A- Introduced by the Competition (amendment) Act, 2007.

 

19.Section 43 A- Introduced by the Competition (amendment) Act, 2007.

 

20. www.Indiankanoon.org/doc(visited on 28th October, 2012).

Necessity  of  Hearing  of  the  Accused  before  the  Commencement  of  Trial  in  A  Summons  Case

(By Mohamad Rafeeq (Valloran), Advocate, Perinthalmanna)

 

1. The recent decision of the High Court of Kerala in Gopalakrishnan Nair v. State of Kerala (2014 (3) KLT 647), signifies the necessity of hearing the accused before the commencement of trial in a summons case. It is often stated that the presentation of one version with materials to support the said version, may clinch the subjective satisfaction of the judicial mind to proceed against a person arraigned as the accused to face trial in a summons case. The court in such circumstances rely either on a complaint filed by public servant who is discharging his official duties or the evidence of the complainant and other witnesses as provided u/S. 200 and 202 of the Cr.P.C. The latter has a different colour and tenor since the court has embarked on evidence gathering exercise, in both the cases the counter petitioner stands out side the purview of the proceedings. The outsider is brought inside the dock with issuance of the summons whether such person must be given an opportunity of being heard before the commencement of trial in a summons case, when process is issued u/S.204 of the Cr.P.C.

2. The Apex Court while considering petition u/S.482 in a criminal case states that documents of unimpeachable character produced by the accused can be looked into for considering such a plea by the accused, it is evident that certain proved and accepted public documents may perhaps throw away the prosecution case. Hence it becomes imperative that before recording the plea to commence the trial a fair chance must be given to the accused to prove his innocence to twist the judicial mind to drop the proceedings before the trial. No prejudice is caused to the complainant in view of such a review. On this point the classical rule is available to save the prosecution that evidence is not sifted at this stage.

3. It is to be noted that S.258 of Cr.P.C. or S.203 of the Cr.P.C. will not help the accused to file a petition for dropping the proceedings or rescinding the process already issued. The Apex Court in Adalat Prasad v. Rooplal Jindal (2004 (3) KLT 382 (SC)) has rendered  "(paragraph 15). It is true that if a Magistrate takes cognizance of an offence, issues process without there being any allegation against the accused or any material implicating the accused or in contravention of provision of section 200 and 202 the order of the Magistrate may be vitiated, but then the relief of an aggrieved accused can obtain at that stage is not by invoking section 203 of the Code because the Criminal Procedure Code does not contemplate a review of an order. Hence in the absence of any review power or inherent power with subordinates criminal courts, the remedy lies in invoking 482 of the Code”.

4. A conjoint reading of sections 190 and 200 will be helpful to comprehend the distinction Section 190 read as “Cognizance of offences by Magistrate.-  (1) Subject to the provisions of this Chapter, any Magistrate of the first class, and any Magistrate of the second class specially empowered in this behalf under sub-section (2), may take cognizance of any offence—

(a) upon receiving a complaint of facts which constitute such offence;

(b) upon a police report of such facts;

(c) Upon information received from any person other than a police officer, or upon his own knowledge, that such offence has been committed.

(2) The Chief Judicial Magistrate may empower any Magistrate of the second class to take cognizance under sub-section (1) of such offences as are within his competence to inquire into or try.

5. Section 200 reads as; examination of complainant.- A Magistrate taking cognizance of an offence on complaint shall examine upon oath the complainant and the witnesses present, if any, and the substance of such examination shall be reduced to writing and shall be signed by the complainant and the witnesses, and also by the Magistrate:

Provided that, when the complaint is made in writing, the Magistrate need not examine the complainant and witnesses-

(a) If a public servant acting or purporting to act in the discharge of his official duties or a Court has made the complaint; or 

(b) If the Magistrate makes over the case for inquiry or trial to another Magistrate under section 192:

Provided further that if the Magistrate makes over the case to another Magistrate under section 192 after examining the complainant and the witnesses, the latter Magistrate need not re-examine them.”

will be helpful for comprehending the issuance of the process u/S.204 of the Cr.P.C. and in cases where.

6.  The benefit under S.258 is available to those cases which are summons cases instituted otherwise than upon complaint; it becomes explicit that the advantage is restricted to such cases only.

7.  Section 258 reads as “Power to stop proceedings in certain cases--

In any summons-case instituted otherwise than upon complaint, a Magistrate of the first class or, with the previous sanction of the Chief Judicial Magistrate, any other Judicial Magistrate, may, for reasons to be recorded by him, stop the proceedings at any stage without pronouncing any judgment and where such stoppage of proceedings is made after the evidence of the principal witnesses has been recorded, pronounce a judgment of acquittal, and in any other case, release the accused, and such release shall have the effect of discharge.”

Hence the process issued consequent to the examination of the complainant or witnesses and evidence gathered so will stand in a different footing, here the satisfaction of the judicial mind has already been applied towards the available materials which could not be reviewed in view of the above dictum laid down by the Apex Court in Adalat Prasad v. Rooplal Jindal  (2004 (3) KLT 382 (SC)).

Regulating  Cyberspace : Realities  and  Challenges

(By Dr. Raju Narayana Swamy, I.A.S.,  Ph.D., Secretary to Government of Kerala,

Chairman,  K.B.P.S. & Homi Bhabha Fellow)

 

The term ‘ cyberspace’ was coined by William Gibson in his book Neuromancer published in 1984.  It has now come to denote anything related to computers, the internet, websites and even devices such  as ATM machines and cell phones. The New Oxford Dictionary of English defines cyberspace as the notional environment in which communication over computer networks occurs.  Thus while internet is a fact, cyberspace is a fiction- a man made machine world.

 

It is the natural extension of the physical world into an infinite world- a virtual medium with no boundaries characterized by dynamism and anonymity.  It is a world run not by weapons, energy or money, but by little ones and zeroes.  It can no longer be protected with high walls and long range missiles, but only through the development of layers of defences accompanied by improved awareness of  adversarial  capabilities and  intentions. 

 

Cyber law is the law governing cyberspace. It has three building blocks- netizens, cyberspace and technology.  Issues addressed by cyber law include cyber crime, e-commerce, online contracts, e-governance, data protection and privacy, intellectual property  issues in cyberspace etc.

 

E- commerce  has been referred to as “ any transaction conducted over the internet or through internet access, comprising the sale, lease, licence, offer or delivery of property, goods, services or information, whether  or not for consideration......” (The Internet Tax Freedom Act, 1998).  In layman’s terms, it means the buying and selling of products or services over the internet.  Electronic contracts are contracts that are not paper based but in electronic form.  They are born out of the need for speed, convenience and efficiency.  The whole transaction can be completed in seconds, with both parties simply affixing their digital signatures.   The era of delayed couriers and additional traveling costs is gone with the wind of technological change.

 

Cyber crime on the other hand has been defined in the “ Computer Crime:  Criminal Justice Resource Manual”  published in 1989 to cover the following:-

 

a) computer crime

b)  computer related crime (ie,) violations of criminal law that involve a knowledge of computer technology for their perpetration, investigation or prosecution

c)   computer abuse.

 

The Convention on Cyber Crime of the Council of Europe is at present the only binding international instrument on cyber crime.  However, different countries have their own legislations related to cyber law.  The U.S.A. for instance has enacted the Computer Fraud and Abuse Act of 1987, the No Electronic Theft Act of 1997, the Digital Millennium Copyright Act of 1998, the Child Online Protection Act of 1998 and the Electronic Signatures in Global and  National Commerce Act of 2000 - to name a few. 

 

India is the first South Asian country to enact cyber law. In India, cyber law is synonymous with the Information Technology Act, 2000.  It is a facilitating, enabling and regulating Act – all in one. It came into force on 17th October, 2000. This Act is based on the resolution adopted by the General Assembly of the United Nations on 30th January 1997 regarding the Model Law on Electronic Commerce earlier adopted by the UNCITRAL (United Nations Commission on International Trade Law) in its twenty-ninth session.

 

Not only does the Act apply to the whole of India, but also to contraventions committed outside India involving a computer located in India. This is in the true spirit of a one wired world.  But certain persons are exempt from prosecution under the Act.  The President of India and Governors of States (under Art. 361 (2) of the Constitution) and diplomats covered by the Vienna Convention on Diplomatic Relations of 1961 are included in the exempted list. 

 

Moreover, the Act does not apply to the following documents/transactions,

a) A negotiable instrument (other than e-cheques and truncated cheques).

b) A power of attorney.

c)  A trust.

d) A will.

e) Any contract for the sale or conveyance of immovable property .

f)  Any such class of documents or transactions as may be notified by the Central Government. 

 

The purposes of the Information Technology Act include the following:-

a) To provide legal recognition to e-commerce.

b) To facilitate electronic filing of documents with the government agencies.   

c) To amend the Reserve Bank of India Act, 1934 (so as to facilitate electronic fund transfer) as well as the Bankers’ Books Evidence Act, 1891(so as to give legal sanctity for books of accounts maintained in electronic form).

 

The Act prescribes digital signatures as a means of authentication of electronic records.  In other words, a digital signature has the same function as that of a hand written signature.  However, digital signature does not mean scanning the hand written signatures electronically.  In fact, India follows a technology specific regime wherein digital signatures using prescribed asymmetric cryptosystem standard alone are considered legally valid.  By applying digital signatures, an electronic message can be transformed into an alphanumeric code.  It needs a key pair and a hash function. It needs to be mentioned here that digital signature is a subset of electronic signature (which includes biometric signatures, passwords, PIN etc).  

 

The promotion of electronic governance is also one of the prime objectives of the I.T. Act.  In particular, Section 6(1) provides the roadmap for promotion of e- governance.  It stipulates that the requirement of a law regarding filing of any form, application or any other document with any office, authority, body or agency owned or controlled by the appropriate government  or the issue or grant of any license, permit, sanction or approval or the receipt or payment of money 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.  Section 8 of the Act treats the electronic gazette as the equivalent of printed form of official gazette.  Moreover, with the introduction of Section 10A, formation of online contracts is now a legal reality.

 

Needless to say, the Act also penalizes various cyber crimes.  Investigation and adjudication of cyber crimes is done in accordance with the provisions of  the Code of Criminal Procedure, Civil Procedure Code  and  the I.T. Act.  Digital evidence is to be collected and proven in court as per the provisions of the Indian Evidence Act (as amended by the Information Technology Act).  In fact, cyber crime encompasses both cyber contraventions and cyber offences.  The difference between the two is more about the degree and extent of criminal activity than anything else.  While a contravention is a mere violation of law, an offence is an act prohibited and made punishable.  For example, a mere unauthorized access to a computer may amount to cyber contravention.  But it is the criminal violation that resulted from it that has to be taken into consideration vis-à-vis ‘ cyber offence’.  Sections 43 (a) to (j) of the Act deal with cyber contraventions whereas sections 66, 66A-66D refer to cyber offences. 

 

To be specific,

a.  Section 66A deals with punishment for sending offensive messages through   communication service etc. ( Telemarketers though covered under TRAI regulations and  DoT guidelines may also fall under this section).

b.  Section 66B dwells upon punishment for dishonestly receiving stolen computer resource or communication device. 

c.  Section 66C outlines the punishment for making use of the electronic signature, password etc., fraudulently or dishonestly.

d.  Section 66D deals with punishment for cheating by personation by using a computer resource.

e.  Section 66E prescribes punishment for violation of privacy (sting operation by a private person or an agency which may result in violating bodily privacy of another person will fall under this section).

f.   Section 66F dwells upon punishment for cyber terrorism (Acts of perpetrators of the 26/11 attacks may fall under this category).

g.  Section 67 deals with publication/transmission of obscene material in electronic form and section 67B punishes child pornography in online medium.

h. Under Section 69, the Central Government or a State Government or any of its officers specially authorized may, if satisfied that it is necessary or expedient to do so in the interest of the sovereignty or integrity of India, the security of the State etc, direct any agency of the appropriate government to intercept, monitor or decrypt any information transmitted, received or stored in any computer resource.  Similarly
Section 69A has been incorporated to block for access by the public any such information. 

i.   Section 70 stipulates that the appropriate government may declare any computer resource which affects the facility of Critical Information Infrastructure to be a protected system.  Section 70A calls for setting up of a national nodal agency in respect of Critical Information Infrasturcture Protection. Also Section 70B advocates appointment of CERT - IN (Indian computer Emergency Response Team) to serve as national agency for incident response. 

j.    Section 76 provides for confiscation of computers, computer systems, floppies, compact disks etc. 

k.   Section 79A has been introduced for the purposes of providing expert opinion on electronic form evidence.

l.    Section 78 provides that a police officer not below the rank of Inspector shall investigate any offence under the Act. Section 80 provides for any police officer, not below the rank of Inspector or any other officer of the Central Government or a State Government authorized by the Central Government to enter any public place and search and arrest without warrant any person found therein who is reasonably suspected of having committed or of committing or of being about to commit any offence under this Act  (Public place includes any public conveyance, hotel, shop or other place intended for use by or accessible to the public).

m. Section 88 provides for the constitution of Cyber Regulations Advisory Committee.  It has an important role to play by advising the Central Government for formulating relevant orders, rules and regulations. 

 

For example, creating a fake profile of a woman on a social networking site (such as Orkut or Facebook ) describing her as a woman of “loose character “ is punishable under
Sections 66 A and 67 of the Information Technology Act and Section 509 of the Indian Penal Code.  If the fake profile is of a man and contains defamatory information about the victim, the sections attracted are   66A of the Information Technology Act and 500 of the Indian Penal Code.  Petrol pump attendants who note down information of credit cards used for making payment and thereafter sell the information to gangs for misuse through online frauds are punishable under Section 43,66, 66C, 66D of the Information Technology Act  r/w Section 420 of the Indian Penal Code. A business rival who obtains tender quotations etc., using hacking and then uses the information for the benefit of his own business is punishable under Sections 43, 66 and 66 B of the Information Technology Act and Section 426 of the Indian Penal Code.

A disgruntled employee who steals confidential information and mass mails it to the victim’s rivals is also punishable under the same sections. A music pirate who sells pirated music through electronic downloads via websites is punishable under Sections 43 and  66 of the Information Technology Act and Section 63 of the Copyright Act.  A hacker who replaces the home page of a government website with a defamatory page is punishable under Section 43 and 66 of the Information Technology Act.  In some cases, Sections 66F, 67 and  70 may also apply. 

 

Some commonly used terminologies in the cyber landscape are:-

1.  Email Spoofing:- It is defined to be an email activity in which the sender addresses and other parts of the email header are altered to appear as through the email originated from a different source. 

2.  Identity Theft: - Common instances are reading someone else’s mail or stealing money or getting other benefits by pretending to be some one else.  Dumpster diving, shoulder surfing, phishing etc.,  come under the umbrella of identity theft.  Phishing for instance involves criminals attempting to lure individuals through spoof emails to log on to a false website and part with credit card and other sensitive information.

3.  Hacking: - Hacking means unauthorized attempts to bypass the security mechanisms of an information system or network. It is computer trespass- the accessing of computer system without the express or implied permission of its owner. Hacking is not defined in the amended I.T. Act.

4.  Data Theft:- In today’s world where large files can be transmitted via email, USB devices etc., data theft is a growing concern.  It is dealt within Section 43 (b) of the I.T. Act. 

5.  Spreading Viruses or Worms: - Computer virus has been defined in explanation (iii) to Section 43 of the I.T. Act.  Worms are contaminants that do not replicate within other programs.   If someone  deliberately infects your computer with malware, you can file two cases-one before the Adjudicating Officer under section 43 and the other with the police under Section 66.  Under Section 43, a person may be liable to pay compensation.  If the compensation claim is below ` 5 crore, the case is to be filed before the Adjudicating Officer.  For claims above ` 5 crores, the regular courts have to be approached.  Even if one accidentally emails a virus to someone, he may be liable under Section 43 (c) of the I.T. Act.  In fact, the I.T. Act covers all forms of malware including trojans, root kits, keyloggers, adware and spyware. Thus, for instance, installing keyloggers could land a cyber cafe owner in jail.   However the I.T. Act does  not cover bots (computer programs that post automatic replies on websites and /or send automatic emails just to create havoc).

6.  Email Fraud: - Financial, banking or social fraud committed with the help of an email is called an email fraud.  A common example is lottery fraud.  Here an email informs the user that he has won an international lottery.  In reality, there is no lottery and no prize. 

7.  Cyber Stalking: It refers to the use of the internet, email or other electronic communication devices to stalk or harass a person.  It involves following a person’s movements across the net by posting messages on bulletin boards  frequented by the victim, entering chat rooms visited by the victim etc.  Section 66A provides cover for cyber stalking.  Both texting (sending persistent text messages) and sexting
(sending sexually explicit photographs, MMS) are covered under this section. 

The following real life incidents speak volumes for themselves:-

     a.          Two Air India cabin crew members were arrested and jailed for 12 days for posting
 “ derogatory” remarks against the Prime Minister’s Office, the national flag and the Supreme Court while commenting on a strike by Air India Pilots  (May 2012).

     b.          A Chemistry Professor at Jadavpur University was arrested for forwarding a cartoon featuring the West Bengal Chief Minister  (April 2012).

     c.          A medical technician who posted on facebook the photograph of the corpse of  a  strangled victim at a crime scene while on duty was fired from his job and banned from ever becoming an emergency medical technician again. (New York, 2011).

     d.          A school student committed suicide due to excessive cyber bullying.  She had been receiving abusive text messages and was being harassed on her facebook wall. 
(Massachusetts, U.S.A. 2010).

     e.          A 26-year old engineer was arrested and later jailed in Morocco for posing as the King’s younger brother on facebook ( February 2008).

     f.           A property dealer was arrested for circulating jokes on Sikhs.  He was booked for hurting religious sentiments and for sending offensive electronic messages (Amritsar, September 2013).

     g.          The Pune rural police cracked down on an illegal rave party and arrested several illegal drug users. Orkut.com was the main mode of communication for gathering people for the said party.  However, in this case, the Information Technology Act does not usually apply.  Depending upon the illegal items being transacted in, the Narcotic Drugs and Psychotropic Substances Act/Arms Act/wildlife related laws may apply.  ( March 2007).

     h.         A 12 year old boy hacked into the controls for the huge Roosevelt Dam on the Salt River in Arizona.  He might have released floodwaters that would have inundated Mesa and Tempe, endangering at least ten lakh people (U.S.A., 1998).

     i.           Recently, a Trojan almost led to the death of a reporter.  A lady was working on an article about online relationships.  During the course of research, she befriended many strangers online.  One of them remotely implanted a Trojan on her home computer.  Staying in a small one bedroom apartment in Mumbai, her computer was in a corner.  The Trojan hijacked her webcamera and her microphone both of which were attached to her computer.  Numerous pictures of her in various compromising positions were hijacked by the hacker who then uploaded them on a pomographic website.  She attempted suicide, but fortunately survived.

     j.           A series of more than 125 separate but coordinated denial of service (DOS) attacks hit the cyber infrastructure of Estonia.  The attacks are suspected to be carried out by Russian hackers using automated DOS software.  The software made millions of requests and unable to handle them, the government server crashed.  (2007).

     k.          An Airtel hacker obtained “sensitive” information about high profile subscribers and
demanded `1 crore from the company for not disclosing the information.

     l.           A Bangalore based BPO worker masterminded a call centre fraud by leaking credit card information relating to global clients of Hong Kong and Shanghai Banking Corporation. 

     m.         The Gurgaon based company, Infinity e-search became a victim of BPO frauds. 

However, allegations are galore that free exchange of information is being restricted in the new IT regime.  Tying a leash around the only avenue from where the public can acquire diverse information may be counter productive in the long run.   To quote J.Stewart Dazell, “any content-based regulation of the internet no matter how benign the purpose, could burn the global village to roast the pig. “ It is significant to note here that as per a Gazette notification in 2003, the Indian Computer Emergency Response Team (CERT- In) has been designated as the authority to issue instructions in the context of blocking of websites.  No doubt, websites promoting hate content, racism, violence etc., can be reasonably blocked.  Blocking them may be equated to “balanced flow of information “ and not censorship.  But we must also protect the autonomy that a medium such as the internet confers to ordinary people.

 

At the same time, cyber crimes are still on the rampage.  The internet is not just a world full of information, friends, fun, education and  sports, but also a world full of drug dealers, cyber stalkers, psychopaths and  even recipes to make bombs.  The billion dollar question that arises is: are the legislative and judicial efforts that have been made sufficient enough to stop this technological epidemic?  For instance, unlike real world crime, cyber crime is not physically grounded.  It increasingly tends not to occur in a single sovereign territory.  With the click of a mouse or a keystroke, cyber criminals are in a position to disrupt any computer network located anywhere in the world.  It is hydra headed and difficult to be contained through the agency of law. 

 

Moreover, the nature of evidence in the real world and the virtual world is different.  Investigating agencies are often crippled by the fact that possible evidence in a computer system can be altered and the genuineness of such evidence is often challenged in courts of law.  Another major hindrance in the investigation of cyber crime is the lack of expertise in cyber forensics.  It requires extensive knowledge of the hardware, software and operating systems.  Contrary to the real world crimes where tangible evidence in the form of finger prints, weapon of crime, bloodstain marks etc., can be traced, in the virtual world such traces become very difficult to find.  This poses a major challenge as the prosecution must also become familiar with the technicalities and should appreciate evidence in a logical format.  It is no longer Man v. Man, it is now Machine v. Machine - an era of nameless, faceless and bloodless crime. 

 

The reality in the field is that unless the loopholes are fixed in a time bound manner, there is every possibility that the fracas can acquire the shape of a societal chaos. Cyber crimes must be hit back in a game changing way and must be recognized as part of the larger problem of malicious activity including the actions of a continuum of actors ranging  from the low level hacker and the pure criminal to organized criminal groups and nation - states with their proxies and surrogates.  It must be addressed strategically and proactively by an alliance of key business and government stakeholders, including but not limited to law enforcement.  The challenge before us is to diminish the vast, complex ecosystem of cyber risk through a comprehensive approach that crosses the organizational boundaries that the threats themselves transcend. 

 

The complexity of the problem of cyber security can be amply seen from the following scenario:

a.  Cyber war is now a reality and we stand on the brink of a cyber calamity. In the fall of 2010, the world learned about the Stuxnet worm - a highly sophisticated computer attack tool that disrupted centrifuges processing nuclear fuel for the Iranian nuclear bomb program.  This event was the first tangible illustration that cyber attacks can disrupt not just computers, but also physical processes in the real world. 

b.  Quietly, but with serious consequences, the internet’s model of “governance by no governance” is failing to keep the internet running.  Quite simply, the internet has run out of I.P. addresses.  Moreover the transition from one global internet protocol to another is challenging and the lack of any effective governance of the internet makes this transition even more daunting. 

c.  Every few months brings the latest “worst ever cyber theft” such as the successive thefts of over 100,000,000 user accounts from Sony in April 2011.

d.  Most cyber networks are in private sector hands.  Thus the government and cyber security policy have only limited and very indirect influence on cyberspace.

e.  The changes following the September 11, 2001 terrorist attack have inadvertently created new information sharing problems, including information overload for home-land security analysts and a decline in information quality.  A classic case in point is the bomber plot of North West Airlines Flight 253 to Detroit on Christmas Day, 2009- over eight years after 9/11.  In this case, multiple government agencies-the CIA, US State Department and NCTC - had access to separate pieces of information about Umar, the person who planned to detonate the explosives on Flight 253- a ticket paid for in cash, a warning to the CIA about his links to extremists and multiple reports entered into government databases.  Moreover, North West Airlines- a private sector entity- had  basic information about Umar’s ticket purchase, lack of checked baggage and passport number.  With the benefit of hindsight, these data points should have stood out to homeland security analysts and prompted several US government agencies to take actions that would have prevented Umar from boarding flight 253.  The challenge for homeland security now is to build cross-sector trust through public private partnerships, control the information flood and manage information quality for decision makers - from law enforcement, to emergency management, to critical infrastructure protection.  Add to these the problems of incomplete or duplicative information that makes its way into law enforcement data bases and  the picture is complete.  For example, two entries in a database may actually refer to the same person, but because of a misspelled name, future updates to those data base entries become split between the two database entries. 

 

The rise in criminal intelligence about persons whose names do not use characters from the Latin alphabet ( ie.,) a, b, c, d) further complicates the issue.  For example, a name in Arabic can be spelled any number of ways in English.  Because of these differences in spelling, a police officer running a database check on a particular spelling may turn up nothing at all, because the person is actually listed in the database under a different spelling. These inconsistent spellings and issues accompanying transliteration can cause confusion in both data entry and data searches.

 

  The range of possibilities can be depicted in a simple graph  (Regulating Cyber Security, Nathan Alexander Sales, Northwestern University Law Review, Vol 107 No4, 1503, 2012-2013).

 

The x - axis depicts the firms that might be subject to a cyber - attack (arranged from left to right in order of increasing strategic significance.) To the right are financial institutions which rate high on this scale, an attack on a single bank having an order of magnitude greater impact on the global economy than 9/11.  At the far right are power companies and other public utilities.  Needless to say, a cyber attack on the power grid would be catastrophic.  The y-axis depicts the assailants that might commit a cyber - attack.  At the bottom are recreational hackers.  One step above are “hacktivists”- relatively skilled hackers who use cyber-intrusions to advance a political agenda.  An example is “ Anonymous”, a loose association that in
late 2010 launched DDOS attacks on financial institutions that refused to let customers send money to WikiLeaks.  Next are organized crime syndicates. At the top are foreign government’s militaries and intelligence services- the most sophisticated adversaries of all.  Internet giant Google recently saw its gmail service penetrated by Chinese spies who wanted to eavesdrop on the Dalai Lama.  Similarly RSA, a software firm that issues online security credentials for the Pentagon, was compromised so badly. 

 

The curve roughly predicts the combinations of victims and attackers that are likely to occur.  Quadrant 4 includes high- frequency, low - severity attacks.  Quadrant 2 involves attacks that are low frequency and high severity.  The following conclusions appear to hold much promise in this state of affairs:-

 

a.  All private firms might be asked to provide a baseline level of cyber-security with the government stepping in to assume responsibility for defending public utilities against catastrophic attacks by highly sophisticated adversaries.  This division of labour is the opposite of what we see in real space criminal law wherein the government offers all citizens a baseline level of protection (in the form of police officers etc.) and individuals supplement these protections at their own expense  (by installing burglar alarm systems etc.).

 

b.  The closer we are on the curve to the lower left corner, the higher the probability that the firm is investing a socially optional amount in cyber-defence.  Society will not grind to a halt if Amazon.com is knocked  offline. In addition, these companies are unlikely to face attacks by skilled foreign governments.  So it is not necessary for them to spend huge sums of money on the very best and most impregnable defences. 

 

c.  The closer we are on the curve to the upper right corner, the lower the probability that the firm is adequately investing in cyber-security.  Because the expected cost of an attack on these firms is so high, it is efficient to invest greater sums in securing them. 

 

d.  For improving the ability of critical systems to survive intrusions, proactive steps should be taken then and there. For instance, infected computers could be temporarily disconnected from the net to keep them from spreading malware.  Like the public health system, effective cyber-defences depend on information about the incidence  and prevalence of various kind of malware.  In other words, both biosurveillance and quarantine carry important lessons for cyber security.  Moreover, companies should be encouraged to build systems with excess capacity (such as reserve bandwidth  and  remote backups). 

 

To summarize, what we need to secure cyberspace is not cops, spies or soldiers, but realistic long term and short term measures with strategic planning as its bed rock.  In view of the modus operandi being employed by today’s sophisticated criminals , the I.T. Act should be made more rigid and practical.  A cyber jurisprudence based on cyber ethics  is called for.  A techno legal approach concentrating on effective use of technology to combat the menace coupled with changes in legislation attuned to the non-hierarchical, open and dynamic culture of the “net” is the need of hour.  To quote Fridtjof Nansen, “we need courage to throw away old garments which have had their day and no longer fit the requirements of the new generation. “To put it a bit differently, proactive  steps are needed so that the Act can have sufficient ‘byte’ with the better part of both wisdom and valor.  Needless to say, these measures must be accompanied by a sustained effort towards awareness promotion so that risk management in virtual space becomes a reality.  For this Utopia to come time, what is needed is deeds, not words and political will to plan accompanied by  administrative competence to execute.

 

References

 

Abu Baker Munir, Internet Banking Law and Practice, (2004)Lexis Nexis, Butterworth.

Anthony Reyes & Richard Britten and others, Cyber Crime Investigations, (2011)Syngress, U.S.A.

Broadhurst & Chantler, ‘Cybercrime Update: Trends and Developments’, (2006), Exper Group Meeting on the Development of Virtual Forum against Cybercrime Report, June 28-30, Seoul KoreaKICJP & UNODC, PP.21-56.

‘Cyber Crime Strategy’(2010), Report presented to Parliament by Secretary of State for the Home Department by Command of Her Majesty, March, UK.

‘Cyber Pornography & the IT Act’, www.asianlaws.org,

Cyber Crime Police (2013), Kerala Police, Government of Kerala.

Deharati,Halder & Jaishanker, K., Cyber crimes against women in India, (2008) www.igi-global.com,  

 Doring, N (2000), ‘Feminist Views of Cybersex: Victimization, Liberation and Empowerment’, Cyber Psychology and Behaviour, 3(5), pp.863-84.

Greenfield, D.N. & Orzack, M., ‘The electronic bedroom: Clinical Assessment of online sexual problems and internet-related sexual behaviours’, (2002) in Cooper, A. (ed.), Sex and the Internet: A Guide Book for Clinicians, Brunner-Routledge, New York.

Hussain, Rashin, ‘Cyberspace Task Force for Child Protection’, (2011), International Journal of Academic Research, 3(2), part IV, March.

‘India to have 3rd largest number of Internet users by 2013’(2009), The Times of India, July 26, www.articles.timesofindia.indiatimes.com,

‘I.T. (Amendment) Act, 2008 comes into force’ (2009), Cyber Media, www.ciol.com

Jonathan Rosenoer, Cyber Law: The Law of the Internet, (1997) Springer-Verlag, New York.

‘Measuring the information society’(2011), International Telecommunication Union, Geneva, www.itu.int., 

Mukherjee, Dyutimoy,  ‘Child Pornography: A Comparative Study of India and EU’, (2007), Calcutta Criminology Law Journal, January.

Muthukumaran, B., ‘Cyber Crime Scenario in India’, (2008) Criminal Investigation Department Review, Government of India, January.

Pelissie du Rausas, Mattbieu, & others, ‘Internet matters: The Net’s sweeping impact on growth, jobs and properity, (2011) Mckinsey Global Institute, www.eg8forum.com

Prasanna, A., ‘Cyber Crimes: Law and Practice, www.img.kerala.gov.in, 

Report on ‘Enhancing Women Empowerment through Information and Communication Technology’, Department of Women and Child Development, Ministry of HRD, Government of India.

Singh, Talwant, ‘Cyber Law and Information Technology’, www.delhicourts.nic.in,

‘Some tips to prevent the most common cyber crime-cyber stalking’ (2007), A Wide Angle View of India, www.nitewriter.wordpress.com

Victoria L. Tinio, ‘ICT in education’, www.saigontre.com,  .

Zeinab Karake Shalhoub & Sheikha Lubna Al Qasimi (2010), Cyber Law and Cyber Security in Developing and Emerging Economies, Edward Elgar Publishers Ltd, U.S.A.

About Dying Declaration

(By T.M. Rajasekharan, Advocate, Calicut)

 

Considerable discussions have already taken place regarding the legal validity and acceptability of dying declaration in criminal trials. Hon’ble Judicial Magistrate of Ist Class Ramankary, Mr. M.E. Aliyar (2014 (2) KLT Journal 47) has rightly pointed out that the dears and near ones of the dying patient have a right to be near him at the death bed. These days, with the advent of various medical devices coupled with the mechanical approach of the medical profession, towards patients suffering from critical ailments, it is hardly possible for the dear and near ones to see the patient who is awaiting death in an ICU ward or even incubator.

 

The medical profession has probably its own reasons not to admit the dear and near ones at the hospital bed hoping that the life of the patient could be saved and the presence of dear and near ones is not advisable in the ward. We cannot blame this situation for such rigid outlook as even the best physician cannot predict the exact time of death of an individual. Then the dying declaration has to wait in medico legal cases.

 

As for the dying declaration, the law unfortunately considers that what one discloses on the death bed would be a fact and a person implicated can be convicted on the basis of such dying declarations. No doubt dying declaration many have its own legal value but it should not be forgotten that a dying declaration will disclose the facts only if the person is aware that he is going to die soon. But there is a strong will in every person to continue his life. His ego never permits him to believe that he is breathing his last. The dying declaration, to be accepted as truthful, is always linked with one’s culture, civilization and philosophy. Shakespeare said “Be sure of your death, then life and death will be sweeter”. This is easy to say but difficult to practice. There are many instances that the dying declarations have been proved to be totally false. A person might tell the whole truth in a dying declaration only if he knows that his death is imminent. Otherwise the strong will to live may at least in some cases prompt him to tell falsehood.

 

Why a person should speak untruth at the time of the death may battle the general public but the Judiciary should be extremely careful in adopting a dying declaration implicating another person for the cause of the injury suffered by the dead person. What one speaks at his death bed even if he knows that his life is going to end soon could be interpreted in different manner. In the famous novel ‘Catalina’ by Somerset Maugham, an interesting aspect of this type is depicted. There, a Superior of a convent was about to die. But she was not approving the social status of the next nun to inherit her position of Mother Superior. Her last words were “A women of humble origin”. What she actually meant was about the person to succeed to her position in the convent. All those around the death bed naturally thought that she was speaking of herself in humiliation and praised her virtue. But her cousin, another nun knew well what was the real meaning of her last words that they were about the next incumbent. Such is the intriguing aspect of death-bed declaration.