Harish Kumar C Vakaria v. M/s India Infoline Ltd
In the Cyber Appellate Tribunal, New Delhi
Appeal No. 1/2009
Before Justice Rajesh Tandon, Chairperson
Decided on May 26, 2010

Relevancy of the case: Applicability of Section 43 of the IT Act, 2000

Statutes & Provisions Involved

• The Information Technology Act, 2000 (Section 43, 57)
• The Arbitration and Conciliation Act, 1996 (Section 8)

Relevant Facts of the Case

• The Appellant had opened an Online Demat Account with India Infoline Ltd. The Petitioner received access to the Online Trader Terminal Software on January 8, 2008.
• The Petitioner deposited a cheque of Rs. 94,500/- for the IPO of Rural Electrification Corporation. Karvy.com displayed that 121 shares were allotted to the petitioner, amounting to Rs. 12,705/- The Bank received the rest of the amount.
• The Demat Account did not credit the above said shares, and the Demat Account was closed and notified via message. 
• The Petitioner alleges that the account was closed for 37 days and reopened with the correct status of HUF. After unauthorised closing/suspension of the Demat account, appellant suffered losses to the extent of Rs. 2,555/- (Online Demat A/c opening charges and Online Trader Terminal Software charges, Rs. 3013/- (Difference amount of highest market price of 121 shares of REC Ltd. and Purchase Price (121 shares 130-105), Rs. 1655/- (Loss on Rs. 94,500/- as the amount remained blocked for a period of one month at the rate of 21%, private lending rate.)
• The unauthorised access/suspension comes under Section 43 of The IT Act, 2000.

Prominent Arguments by the Advocates

The Respondent’s Counsel claimed that the appellant has filed for proceedings under Section 8, the Arbitration and Conciliation Act, 1996, there should be no consideration of the Adjudicating Officer (Gujarat)’s decision.

Opinion of the Bench

• The Bench carefully examined the validity of the Appeal to the Cyber Appellate Tribunal under S.57 of the IT Act, 2000.
• The Bench opined that it is important to understand the remedies agreed to by both parties through the signed e-contract.  One of the remedies to look at is Arbitration.

Final Decision

• The Adjudicating Officer shall receive the matter for a fresh hearing and identification of new parties to be respondents, like the CDL, NSE, and BSE.
• It should see the validity of  S.8 of the Arbitration and Conciliation Act.

 Personal Opinion

• The allegations made by the appellant were powerful, in cases like this, the evidence stored in the respondent(s)’s server can be complex for the applicant to procure. 

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