Mohit Rajpal v. My Taxi India Pvt. Ltd.
In the Telecom Disputes Settlement and Appellate Tribunal
Cyber Appeal No. 11/2019
Before Mr. Shiva Kirti Singh, Chairperson and Mr. A.K. Bhargava, Member
Decided on May 15, 2019

Relevancy of the case: Whether a case of data theft or security breach can be referred to arbitration?

Statutes & Provisions Involved

• The Information Technology Act, 2000 (Section 46)
• The Arbitration Act, 1996 (Section 8(2))
• The Telecom Authority of India Act, 1997

Relevant Facts of the Case

• A complaint was filed by the respondents which said that the appellant allegedly, in his last few days in the company, committed theft of sensitive data and materials, in specific on 29.07.2015 and 31.07.2017, by deceitfully sharing confidential and valuable data from the company’s email ID to his private email ID.
• An agreement was made by the appellant and the respondent which was operative between 10.07.2015 and 30.09.2015. Clause 18 in the agreement talked about arbitration provision and also stated that the arbitration clause shall not be affected by the termination of the agreement or its expiration. On the premise of this service agreement and clause 18 of the agreement, the appellant pursuant to Section 8 of the Arbitration Act pressed for application.
• This appeal was filed against the order disposed of by the Adjudicating officer who dismissed the prayer lodged by the complainant in the application for referral of the dispute to arbitration under Section 8. The AO pointed out that the service agreement between the party ceased to exist from 30.09.2015, hence the arbitration cannot be allowed.

Prominent Arguments by the Advocates

Mr. Dinesh Kumar Sabharwal, Counsel on behalf of the Respondent:

• Reliance was placed upon Dish Net Wireless Ltd. S. Tel Pvt. Ltd. and Aircel Dig iLink India Ltd. v. Union of India of this tribunal stating that the Telecom Regulatory Authority of India Act, 1997 (TRAI Act) is a distinct act requiring judgment by an experienced practitioner and thus, the issues falling inside the jurisdiction of such a tribunal shall not be referred to the Arbitral Tribunal for decision. As per the respondent’s learned counsel, two of the tribunal’s judgments would be against the appellant, even though this matter stems from the Information Technology Act and not the TRAI Act.

Counsels for the Appellant:

• It was submitted that the appellant is primarily obligated by the provisions of the Arbitration Act, such as Section 8, on the ground that, except in criminal matters, all civil disputes are arbitrable and, therefore, tribunals even under the Special Act.

Opinion of the Bench

• Security breach and data theft may impact a large number of people and may not be arbitrable for the simple reason that a common arbitration clause may not bind all affected persons. Implicit constraints on the power and authority of an arbitral tribunal could also have a major impact on this broader issue.

Final Decision

• The Appeal was dismissed as it lacked merit.
• The AO shall make a speedy decision on the complaint in compliance with the statute.

This case summary has been prepared by Akshara Kamath, an undergraduate student at Symbiosis Law School, Hyderabad, during her internship with The Cyber Blog India in June/July 2020.