E-Commerce

Definition of E-commerce

E-Commerce refers to all the legal and regulatory aspects of the internet and the world wide
web. Anything concerned with or related to or emanating from any legal aspects or issues
concerning any activity of netizens and others, in Cyberspace comes within the ambit of
Cyber Law.

The legal framework of cyberlaw

Legal aspects of all the interactions taking place in the cyber world comprises the legal
framework of Cyber Law. For Instance, Cyberlaw includes in its ambit the e-contracts
executed via the opening of the website, various economic interactions, it also includes the
Punitive provisions for the cyber crimes etc. 

Cyberspace is a virtual medium. It is the conventional means to describe anything related to

the Internet and the diverse Internet culture such as social networking, e-commerce, e-
governance etc. The all-pervasive nature makes the role of the cyber law policy critical.

Jurisdiction

Since the internet is open to the entire globe and hence jurisdiction rests with all the courts of
the world. Netizens: entity or person actively involved in the cyber world also called cyber
citizens.

Types of E-commerce 
 E-commerce/e-business may be classified at large in the following six basic types:

Business to Business (B2B)

Refers to all electronic transactions of goods and sales that are conducted between two
companies, generally between the producers and wholesalers. The famous website acting as a
catalyst between such wholesalers and producers maybe India-mart.

Business to Consumer (B2C)

Various predominant e-commerce persisting in India wherein the customer gets a big market
to purchase goods and services. Here, the E-commerce website serves as a platform for the
sale of the goods directly to the end-consumer of the products. For instance Flipkart,
Amazon, Myntra etc.
Consumer to Consumer (C2C)

Generally this model uses the online platform of money and various social media for its
existence. The widespread known phenomenon of “OLX pe Bech de!” can be the best
example to understand E-Commerce at the consumer to consumer-level basis. Example: eBay
is one global example of this kind of e-commerce.

Consumer to Business (C2B)

When the Customer provides goods or services in exchange for money. For Ex. A customer
review or the advertisement of a company by an influencer amongst his followers etc.  

Business to Administration (B2A)

This e-commerce category refers to the services and products offered by the companies to the
Public Administration. For Instance: the small company providing IT support to the local
administrative body

Consumer to Administration (C2A)

This heading includes all the transaction whereby there is a payment made electronically
towards the public administration such as taxes, health appointment.

Important Issues in Global E-commerce

Although E-commerce is something which brings so many advantages and utility it comes
with its own set of technical difficulties and consequences. E-commerce being a Global
phenomenon, its issues also have global characteristics. Few of the important issues in global
e-commerce can be understood as below:

1. Legal aspects of e-commerce: As discussed earlier, the e-commerce model

legislation has been accepted by the UNCITRAL, but whenever an international
model code is formulated it is accompanied with its own safeguards to the
individual state sovereignty wherein the Municipal Legislation keeping the model
laws as standards may deviate in accordance to its own municipal laws.
2. E-security: the security of the end-users has always been a matter of grave
concern globally since the internet has netted two ends of the globe now it is easier
for a person(hacker) to sit in his remote physical location and cause the data or
financial breach of the Victims.
3. Jurisdiction: the Internet is open to the globe and hence the jurisdiction of the
cases has been given to all the courts.
4. Contracts and Liability: the E-contracts made in the cyber-world have been
given legal recognition and the liabilities are also enforceable but the same
 becomes a mammoth task when parties belong to two different nations and have
not made a clause regarding the application of specific law.
5. Taxation: Various facets of taxation such as tax collection, collection of sales tax,
determination of taxpayer’s residence, determination of the origin of income,
jurisdiction are inherently a difficult task in the plane of taxation, but on
integration with the fact of expansion of the market to the present scale of globe
the calculation of the Taxes becomes additionally difficult, wherein various
nations apply various tax evaluation methods in accordance to their own
legislations.
6. Copyrights: Global e-commerce is like an ever-expanding universe of sellers and
buyers and products, it becomes difficult to keep a tap at the copyright violation in
such a huge number to deal with.

Advantages of e-commerce

1. It’s a Business platform unaffected by the barrier of time and distance: the

space of functioning of E-commerce is the internet which may be accessed from
any point of the globe with minimal setup required. The barriers conventionally
faced by any business regarding the limitations of time and distance, is not there
for the e-commerce houses.
2. Lowers the Cost of sale: The availability of the big number of options at the very
click allows to compare the cost of various commodities and services and allowing
to select the best product at the best price.
3. Cheapest means of doing business: the Advantage of having an entity based
upon the server is that the business although occupies a digital space in servers but
need not invest on the physical space whereby improving the quality of the
products via the money saved on the means.
4. Less delivery time and less labour cost etc: the Fundamentals of the pricing of
any products or services is the amount of money or sweat invested into it, the e-
commerce by annulling the need of physical contact reduces the efforts which
might have been otherwise required.
5. Provides solution by decimating cost in price fixation: the major chunk of price
fixation depends upon the cost incurred by the business runner since e-commerce
reduces the costs incurred by the sellers to a large extent hence it decimates the
final cost before reaching the consumer.

Buyer’s Advantages from E-Commerce

1. Reduction in the buyer’s sorting out time: The E-commerce functions

predominantly in well-managed websites or applications having various filters to
produce the list of products as wanted by the individuals in accordance with their
individual needs.
2. Better buyer decision: the availability of various viable options to compare to the
E-space becomes an empowering platform in many ways for the customers. The
 access to the information available on the net about the product makes the
customer more enabled to make better-informed choices.
3. Less time spent in resolving invoice and order discrepancies: the major e-
commerce players have standardised the resolution of the discrepancies through
use of well-trained customer executives or recently trending bots having all the
required answers to various queries raised before it.
4. Increased opportunities for buying alternative products: availability of so
many options at the very click allows the consumer to compare the cost of various
commodities and services and allowing to select the best product at the best price
and also venture into the purchase of the alternative products.

Disadvantages of e-Commerce

1. Fewer people using E-commerce:  Indian trade depended heavily on the local
traders and businessmen who were unorganised to run the show at the grassroots
levels. Average household still prefers the physical market over e-market, there
has been a great increase in the number of internet users but it has yet not attained
the preference similar to the level of Local markets. 
2. Unable to personally or physically examine the product: the physical
examination of the product has always been a must for a conventional purchase of
commodities, giving the purchaser a sense of control over the quality of the goods
or services to be consumed, but in the era of e-commerce these conventional
methods are losing their glory.
3. Special and costly hardware and software are required: Although the presence
in the digital world requires lesser investments that of physically purchasing a
place but, the spending on the software then increases and so does the spending on
the hardware.
4. The website must be maintained and updated regularly: the platform of
communication between the consumer and the seller being the internet, regular
maintenance of the same is a must in order to keep up the tempo of the services
offers to rise.
5. Skilled people are required to maintain the website: the skilled people are
required to not just maintain the level but to constantly keeping on improving into
a better and better platform as it provides the safety to the surfers of the website
from the antagonist software or viruses. 
6. Not suitable for perishable commodities: the situations where the money has to
be spent on e-commerce items ends up increasing the investment made by the
seller hence reducing his profits. Hence e-commerce is not suitable for Perishable
commodities. But the entities such as that of Big Basket have tapped into this
market sector of the consumers already.
 E-Banking
Electronic banking has many names like e banking, virtual banking, online banking, or internet
banking. It is simply the use of electronic and telecommunications network for delivering various
banking products and services. Through e-banking, a customer can access his account and
conduct many transactions using his computer or mobile phone.

Types of e banking

Level 1 – This is the basic level of service that banks offer through their websites. Through this
service, the bank offers information about its products and services to customers. Further, some
banks may receive and reply to queries through e-mail too.

Level 2 – In this level, banks allow their customers to submit instructions or applications for
different services, check their account balance, etc. However, banks do not permit their
customers to do any fund-based transactions on their accounts.

Level 3 – In the third level, banks allow their customers to operate their accounts for funds
transfer, bill payments, and purchase and redeem securities, etc.

Most traditional banks offer e-banking services as an additional method of providing service.
Further, many new banks deliver banking services primarily through the internet or other
electronic delivery channels. Also, some banks are ‘internet only’ banks without any physical
branch anywhere in the country.

Importance of e-banking

We will look at the importance of electronic banking for banks, individual customers, and
businesses separately.

Banks

1. Lesser transaction costs – electronic transactions are the cheapest modes of transaction

2. A reduced margin for human error – since the information is relayed electronically, there
is no room for human error

3. Lesser paperwork – digital records reduce paperwork and make the process easier to
handle. Also, it is environment-friendly.

4. Reduced fixed costs – A lesser need for branches which translates into a lower fixed cost.

5. More loyal customers – since e-banking services are customer-friendly, banks experience
higher loyalty from its customers.
Customers

1. Convenience – a customer can access his account and transact from anywhere 24x7x365.

2. Lower cost per transaction – since the customer does not have to visit the branch for
every transaction, it saves him both time and money.

3. No geographical barriers – In traditional banking systems, geographical distances could

hamper certain banking transactions. However, with e-banking, geographical barriers are
reduced.
Businesses

1. Account reviews – Business owners and designated staff members can access the
accounts quickly using an online banking interface. This allows them to review the
account activity and also ensure the smooth functioning of the account.

2. Better productivity – Electronic banking improves productivity. It allows the automation

of regular monthly payments and a host of other features to enhance the productivity of
the business.

3. Lower costs – Usually, costs in banking relationships are based on the resources utilized.
If a certain business requires more assistance with wire transfers, deposits, etc., then the
bank charges it higher fees. With online banking, these expenses are minimized.

4. Lesser errors – Electronic banking helps reduce errors in regular banking transactions.
Bad handwriting, mistaken information, etc. can cause errors which can prove costly.
Also, easy review of the account activity enhances the accuracy of financial transactions.

5. Reduced fraud – Electronic banking provides a digital footprint for all employees who
have the right to modify banking activities. Therefore, the business has better visibility
into its transactions making it difficult for any fraudsters to play mischief.

E-banking in India

In India, since 1997, when the ICICI Bank first offered internet banking services, today, most
new-generation banks offer the same to their customers. In fact, all major banks provide e-
banking services to their customers.Popular services under e-banking in India

 ATMs (Automated Teller Machines)

 Telephone Banking
 Electronic Clearing Cards
 Smart Cards
 EFT (Electronic Funds Transfer) System
 ECS (Electronic Clearing Services)
 Mobile Banking
 Internet Banking
 Telebanking
 Door-step Banking
 Features 0f E-Banking

1. Bill payment – Every bank has a tie-up with different utility companies, service
providers, insurance companies, etc. across the country. The banks use these tie-ups to
offer online payment of bills (electricity, telephone, mobile phone, etc.). Also, most banks
charge a nominal one-time registration fee for this service. Further, the customer can
create a standing instruction to pay recurring bills automatically every month.

2. Funds transfer – A customer can transfer funds from his account to another with the
same bank or even a different bank, anywhere in India. He needs to log in to his account,
specify the payee’s name, account number, his bank, and branch along with the transfer
amount. The transfer is effected within a day or so.

3. Investing – Through electronic banking, a customer can open a fixed deposit with the
bank online through funds transfer. Further, if a customer has a demat account and a
linked bank account and trading account, he can buy or sell shares online too.
Additionally, some banks allow customers to purchase and redeem mutual fund units
from their online platforms as well.

4. Shopping – With an e-banking service, a customer can purchase goods or services online
and also pay for them using his account. Shopping at his fingertips.

E- Tendering 
Under e- tendering the tenders are published on web site, documents can be downloaded &
can be accessed anytime anywhere whereas in manual tendering it has to be advertised in
newspaper & documents required to be collected manually

Subscriber  IT Act 2000

Duties of Subscribers

Definition.
According to Sec. 2(1)(zg), “Subscriber” means a person in whose name the electronic
signature certificate is issued.Sectio ns 41 to 43 of Chapter VIII of Information Technology Act
prescribe the following duties of subscribers who have obtained the Digital Signature Certificate
from some certifying authority :

a. Generating Key Pair (Sec. 40). Where any DSC has been accepted by the subscriber, he has a
duty to generate the key pair consisting of public key to which private key of the subscriber
corresponds and which is to be listed in the digital signature certificate by applying the
security procedure prescribed under Section 16.

b. Duty of subscriber of Electronic Signature Certificate (Sec. 40A). In respect of Electronic

Signature Certificate the subscriber shall perform such duties as may be prescribed [Inserted
vide ITAA, 2008].

c. Acceptance of Digital Signature Certificate (Sec. 41). Acceptance of digital certificate

entitles him to the rights under it as well as imposes some obligations upon him. Sub-
 sections 1 and 2 of Section 41 provide the following provisions relating to acceptance of
certificate by the subscriber :

i. A subscriber shall be deemed to have accepted a DSC if he publishes or authorizes

the publication of Digital Signature Certificate :

a) to one or more persons ;

b) in a repository, or otherwise demonstrates his approval of DSC in any

manner.

ii. Acceptance of DSC amounts to certification by the subscriber to all who rely on the
information contained there-in that :

a. the subscriber holds and is entitled to hold the private key corresponding to
the public key listed in the DSC.

b. all representations made by the subscriber to the CA and all information

contained in the DSC are true.

c. all information contained in the DSC that is within the knowledge of the
subscriber is true.

d. Control of Private Key (Sec. 42). Sub-sections (1) and (2) of Section 42 lay down the
following duties of the subscriber relating to the control of private key :

i. Duty to exercise reasonable care to retain control of the private key corresponding
to the public key listed in the DSC.

i. Duty to take all steps to prevent disclosure of private key.

ii. If the private key has been compromised (lost), duty to communicate the
same to the certifying authority without any delay.