There are major lacunas regarding the regulatory regime of formation of electronic contracts in Indian legislations as there is no clarity on the norms and regulations for formation of E-contracts.
To establish a valid E-contract, it is pertinent to have an electronic record by the electronic exchange of information via e-mail or any other means[1].
When it comes to Indian law regarding the admissibility of Electronic information with respect to transmission of data, the Indian Contract Act, 1872 and the Indian Evidence Act, 1872 do not put any bar or restraint. Thus, the cardinal principles laid down in the above legislations on contract formation are applicable in Electronic contracts as well[2].
Now, when it comes to E-contracts, we all have come across e-mails, or standard acceptance to terms and conditions or phrases such as “I agree to the above-mentioned terms and conditions” or online forms on web pages[3]. These form a major part of E-contract formation as this is the point where an E-contract actually starts forming[4].
Another mode of formation of E-contracts is via e-mails which is one of the widely and commonly used modes.
In the creation of E-contracts, electronic data interchange plays a critical role. Electronic Data Interchange (EDI) is the process of exchanging standard computer-based business information from one source to another using a standard electronic format.[5] Information is transferred directly from one organization’s computer application to another’s computer application in EDI transactions[6] and is generally used by the parties having continued business relationships.
Hence, EDI and other technological advancements have opened various new avenues for the development and formation of E-contracts in a seamless manner.
Another important method of forming an Electronic Contract is through the use of an Electronic Agent. The electronic agents’ key feature is that they require very little human intervention. Electronic agents are defined as “component of software and/or hardware which is capable of acting exactly in order to accomplish tasks on behalf of its user.”[7]
Recognizing the economic importance of electronic commerce, several countries have attempted to regulate this new form of conducting business and strike a fair balance between consumer protection and economic liberty[8].
The validity of contracts reached by electronic agents is now widely accepted[9]. Intelligence, autonomy, and proactivity are just a few of the features that these electronic beings have in common with human characteristics[10].
Electronic agents are the most important intermediaries in the creation and establishment of electronic contracts[11]. The Electronic agents take into account the data extraction, data analysis, and supply chain operations[12].
