Introduction

E-commerce has revolutionised company practices in the digital age, integrating online transactions into day-to-day activities. The ease and convenience of internet buying is altering consumer behaviour and business, from purchasing to making travel reservations. But the growth of e-commerce also brings with it legal difficulties, particularly with regard to contract law. Understanding how contract law affects online transactions and e-commerce is crucial for both consumers and enterprises. E-commerce law has led to the emergence of numerous business models, such as B2B (business to business), B2C (business to consumer), C2B (consumer to business), C2C (consumer to consumer), and B2B2C (an intermediary business that connects the first firm to the end customer).[i] Despite the revolutionary nature of e-commerce law’s inception, regulations that protect and hold all e-commerce participants, including consumers, accountable are still required to maintain industry equilibrium. This is particularly true for India because of its enormous potential brought about by its robust economy. According to research, the Indian e-commerce law sector has expanded rapidly and is expected to do so in the future.[ii]

What is Online Contract?

Online contracts have become increasingly significant due to the increased usage of the internet and electronic commerce, mostly because of their multiplicity and reach. An agreement that is modelled, signed, and completed electronically typically via the internet is referred to as an online contract or an electronic contract. An electronic contract is one that is created, managed, and implemented by a software programme.[iii] UNCITRAL Model Law on Electronic Commerce[iv] states that ” A contract can be formed by the exchange of data messages, and when a contract is formed using data messages, its validity shouldn’t be contested.”[v]

ESSENTIAL ELEMENTS OF ONLINE CONTRACT 

• Offer and Acceptance: In an online transaction, the seller typically submits an offer via a website or mobile application that offers a thorough description of the good or service in addition to the cost. When a customer clicks a button to confirm the transaction, it is considered accepted. Online contracts sometimes take the form of “click-wrap” agreements, where users click to accept the terms and conditions. Indian courts have confirmed that these kinds of electronic contracts are legitimate and real.
• Consideration: The price that was exchanged between the parties is referred to as consideration. This usually refers to the money transferred by the buyer in exchange for the goods or services that the vendor provides in an online transaction. A consideration may take the form of money, products, services, or even a pledge to refrain from taking certain actions, but it must be legal and have some value according to the Indian Contract Act.
• Intention to Create Legal Relations: Legally enforceable agreements must be the intention of both parties. This objective is usually assumed in business dealings. The purpose is strengthened by online structures that have a defined method for making and accepting gives, as well as explicit user agreements.

Formation of Online Contract

Although no explicit regulation has been introduced for the legality of online contracts, the Information Technology Act, 2000 has provisions for the establishment and validity of online contracts in India. A number of procedures, including email, filling out online forms, placing orders, and using online agreements, might result in the formation of online contracts. Essential components like an offer and an acceptance are required just as much as they are in traditional paper-based contracts. Compared to previous approaches, online contract generation involves the website acting as the shop and responding to the user’s activities. Customers must acknowledge and accept the normal terms stated on the retailer’s website before downloading any content. The customer and the retailer for the transaction then have a contract concluded when the website provides the service and the customer pays the right amount. Traditional contracts and online contracts are nearly identical, with the exception of certain features and requirements.

Validity of Contract 

The Indian Contract Act, 1872 and the Information Technology Act, 2000 both emphasise the idea of forming a legal connection as a foundation for the legitimacy of online contracts in India. Digital contracts are legally enforceable according to the IT Act, which gives electronic signatures the same legal standing as handwritten ones. “Click-wrap” has been adopted by Indian courts. acceptance of binding contracts, whereby users click to consent to terms and conditions, provided that these terms are such that they are easily accessed, understood, and Being in In addition to consumer protection laws like the Consumer Protection Act of 2019, this legal framework ensures that online contracts are recognised and enforceable, just like their offline counterparts, and enhances trust and confidence in e-commerce transactions.

Evaluation of Legal Concerns Arising in E-Commerce

• Jurisdictional Challenges: The fact that the internet transcends national and jurisdictional boundaries is one of its greatest advantages, but it also presents one of the most legal obstacles to e-commerce. This poses inquiries about the field of law that attorneys refer to as Private right away. Conflict of Laws, or International Law, as an alternative. Specifically, in this context, the two most pressing questions are: (a) What law governs any contract; and (b) Can an action based on a contract be heard in Indian courts? [vi] According to established legal precedents, Indian courts have the authority to handle e-commerce cases even if the goods and services were supplied outside of India as long as the matter’s cause of action originates entirely or partially in India.[vii] In India, the place of business, the location of the contract’s formation, and the source of the cause of action are frequently used to decide these. International norms are also taken into account, including the Hague Convention on Arbitration, the IT Act of 2000, the Indian Contract Act of 1872, and the Brussels Act. Generally, courts will uphold paragraphs that clearly and reasonably spell forth the legal area of intended dispute resolution in these decisions. However, India’s law on jurisdiction and enforcement matters pertaining to e-commerce and e-contracts is still developing.[viii]
• Validity of E- Contracts: In India, e-contract authenticity is contingent upon adherence to both the Information Technology Act of 2000 and the Indian Contracts Act of 1872A contract’s fundamental components—offer, reception, acknowledgment, consideration, and intention—must all be established for there to be legal connections.Furthermore, the use of e-contracts often depends on the use of valid electronic signatures recognized by the Information Technology Act. Difficulties also arise from ensuring that the terms and conditions are accessible, clearly negotiated and agreed upon (usually through “click-wrap” agreements) Another issue is the capacity of the parties, particularly with minors or persons who cannot perform the contract. Finally, ensuring compliance with data protection and privacy regulations such as obtaining explicit consent for data processing is important for the integrity of e-contracts

Conclusion

Due to the rapid expansion of e-commerce in India, managing the complexities of online commerce calls for a robust regulatory framework. The Indian Contract Act of 1872 and the IT Act of 2000, which enforce contract law, are crucial in guaranteeing the legitimacy and enforceability of electronic contracts. A clear legal framework that recognises electronic signatures, protects consumer rights, and establishes criteria for online contract completion all contribute to increased trust and confidence in digital transactions. Notwithstanding obstacles pertaining to jurisdiction, legality, and data security, the dynamic legal terrain persists in meeting the requirements of electronic commerce, furnishing a sturdy groundwork for its expansion. Moving ahead, maintaining a balance between innovation and legal evolution will be crucial as India moves closer to becoming a digital nation.

[i] AZB & Partners, E-Commerce in India, Lexology, https://www.lexology.com/library/detail.aspx?g=f45d85e6-6618-4b80-a434-61c206a7ac11.

[ii] According to research, the Indian e-commerce law sector has expanded rapidly and is expected to do so in the future.

[iii] Electronic Contracts and the Law in India by Asian School of Cyber Law

[iv] Model of 1999

[v] Article 11, communication of data messages, UNICITRAL Model Law on E-Commerce, 1996

[vi] VIJAYSINH SHASHIKANT PISAL, ADVANTAGES OF E-CONTRACTS OVER TRADITIONAL CONTRACTS; E-CONTRACTS AND E-COMMERCE IN INDIA,BHARATI VIDYAPEETH DEEMED UNIVERSITY NEW LAW COLLEGE,

[vii] E-Commerce in India – Legal, Tax and Regulatory Analysis, Nishith Desai Associates , http://www.nishithdesai.com/fileadmin/user_upload/pdfs/Research%20Papers/E-Commerce_in_India.pdf.

[viii] Aijaj Ahmed Raj&Wazida Rahman, E-commerce Laws and Regulations in India: Issues and Challenges,Research Gate