Is Email Legally Binding in India
The plaintiff submitted an offer by e-mail, which was accepted by the defendant after an exchange of further e-mail e-mails. The plaintiff emailed the respondent a formal contract containing a detailed arbitration clause. That was accepted and returned to him. A dispute arose over the validity of such an agreement by e-mail. The question was whether an e-mail exchange proving the parties` consent to the settlement of a dispute relating to a contract constitutes a legally binding agreement[8]. The Supreme Court ruled in that case that by exchanging emails, the parties entered into a binding contract containing the arbitration clause, even though no formal contract was signed by the parties. E-mail contracts can simply be defined as “contracts concluded by e-mail are called e-mail contracts”. It includes all the necessary elements of a contract, namely the acceptance of that offer, the consideration and the intention to enter into a legally binding relationship. The person making an offer, commonly referred to as the supplier, may simply enter the desired content of the offer; Enter the recipient`s email address and send the offer to the intended person. Section 10 of the Indian Contract Act872 sets out the essential requirements of a valid contract. According to the article, the parties entering into a contract must give their free consent, there should be legal consideration, the parties should be competent and there should be a legitimate aim.
Contracts concluded by e-mail must comply with all the necessary conditions of the Indian Contracts Act, 1872. The validity of an email contract is also governed by the Information Technology Act, 2002 and the Indian Evidence Act, 1872. In that case, the court found that the insolvency practitioner had not made an acceptable offer, so there was no legally binding contract. Since the validity of email contracts is generally accepted by law, caution should be exercised when doing business by email. To this end, the following tips may be helpful: Section 10A of the Information Technology Act deals with the validity of contracts concluded by electronic means. That article provides: “If, at the time of the conclusion of a contract, the submission of proposals, acceptance of proposals, revocation of proposals and acceptance are expressed in electronic form or by means of an electronic record, such a contract shall not be deemed unenforceable merely because such form or electronic means was used for that purpose.” This section stipulates that at the conclusion of the contract, If the submission, acceptance and withdrawal of a proposal are expressed electronically, this contract is valid. Therefore, e-mail contracts are valid contracts in accordance with § 10A of the Information Technology Act 2002. The Indian Contract Act, 1872 does not refer to the validity of contracts concluded electronically.
However, the Information Technology Act fills this gap. In business, the formation of contracts via email is increasing exponentially. Especially considering online business, this is the only way to transact. In particular, the Working Group noted that shareholders were aware that insolvency administrators would engage their own lawyers with respect to the terms of an assignment agreement. They therefore had to know that this would require further written agreements and negotiations. The court ruled that the email exchange was implicitly “present in the contract,” although the directors did not explicitly say so. With the rise of the e-commerce industry, the number of online transactions has increased rapidly, resulting in an increase in the number of contracts concluded via email. Since the Covid-19 pandemic hit the world, email contracts have become a better and more efficient way to communicate offers and acceptance. However, one of the main reasons to be concerned about these contracts is that the location of the contract is very vague and cannot be determined.
The location of a contract helps to decide the jurisdiction of the courts in this matter. A GmbH went bankrupt. The receivers considered that the company had a potential legal action against third parties. There was an email exchange between the insolvency practitioner and two shareholders of the company (through their lawyers) discussing a possible assignment of rights to pursue the claim to both shareholders. Shareholders claimed that the emails created a legally binding contract whereby the director would make the divestiture at the price indicated in the emails. The insolvency administrator disagreed and proposed that these rights be auctioned. The shareholders asked the court to prevent the auction. It can be concluded that the offer and acceptance by e-mail are legally valid and binding insofar as they correspond to the essential elements of a valid contract under the Indian Contracts Act 1872. However, there is not much clarity on email contracts according to the statutes, regardless of the laws that are made, are not sufficient for a smooth process of drafting contract via email. Although essential elements such as an electronic signature are recognized in the Information Technology Act 2002, much remains to be done to develop a system that strictly regulates e-mail contracts.
Especially in the current situation of the world, where people prefer to conclude e-commerce transactions and contracts via email due to Covid-19, a set of rules that focuses on offer communication and acceptance via email is on the agenda. Awareness workshops should be held so that people can better understand the relevance of email contracts. So there is a theoretical basis for the idea that an agreement on the terms of an email, formally stated or not, could constitute a legally binding agreement, and this theoretical basis was born in the real world by law. 1. Agreement – To have a binding contract, there must be an agreement between the parties. This requires an offer and acceptance of that offer. 2. Consideration – The agreement must be backed by something of legal value given in exchange for the promise. 3. Contractual capacity – The parties must be able to validly conclude a contract. For example, minors are not legally able to enter into a contract, so they are not capable of entering into a contract.
4. Lawful object – The subject matter of a contract must be lawful. Contracts for the commission of a criminal offence or contracts against public order are null and void. The question for these companies is: “Are electronic contracts legally enforceable?” Assuming all the elements to create a traditional contract are in place, an email or web contract can be a valid and enforceable agreement. It has not been clear to the courts whether email acceptance becomes valid upon dispatch or receipt. Instant forms of communication such as faxes and telexes are not covered by the mailbox rule, so acceptance by these methods is only valid when received. Contracts that expressly permit the transmission of notices by electronic mail generally assume that the notice was received by: (a) the time the electronic mail is sent by the sender; (b) a specified period after the date of dispatch by the consignor; or (c) the time indicated on a “Delivery Note” received by the shipper.